Microsoft Researchers Increase CTR 670% Using Behavioral Targeting

Behavioral targeting has been around for a while in various commercial products.  But now, for the first time, researchers at Microsoft Research Asia have completed an important empirical study demonstrating that it works.  In fact, it works extremely well increasing the click-through rate (CTR) up to 670% with the potential to achieve improvements in excess of 1000%.  Wow.  And kudos to Microsoft for undertaking this as an academic research program and making the results available to all.

They cover a lot of important ground in an academically rigirous way.  There are three key conlusions.

The Basic Assumption Holds

The basic assumption of behavioral targeting is that all the people who click on an ad are more similar to each other than they are to all those people who clicked on other ads.  If you can’t prove this assumption, it’s back to the lab to whip up something new.

But, not to worry, the researchers found that the people who clicked on the same ad are up to 90 times more similar to each other than users who clicked on another add.  Whew!  I guess that’s good news for anyone who has been touting the merits of behavioral targeting.  It’s also intuitively satisfying.  Still, it’s great to have it proven by research.

CTR Can Be Increased by Up to 670%

They used click-through rates as their measure of performance (because it is a readily available measure).  They implemented behavioral targeting by segmenting the users with various strategies and then compared what the CTR would have been with and without the segmentation strategy:

Through studying ads CTR before and after user segmentation for ads delivery, we observe that ads CTR can be improved by as much as 670% over all the ads we collected.

and:

In addition, we notice that if we can further design more advanced BT strategies, such as novel user representation approaches and novel user segmentation algorithms, ads CTR can be further improved beyond 1,000%.

Short Term Search Behavior Gives the Best Results

Finally, the researchers examined several different approaches to implementing behavioral targeting:

Through comparing different user representation strategies for BT, we draw the conclusion that the user search behavior, i.e. user search queries, can perform several times better than user browsing behavior, i.e., user clicked pages. Moreover, only tracking the short term user behaviors are more effective than tracking the long term user behaviors, for targeted ads delivery.

What it Means: A Mobile, Local Perspective

This study was done using logs from users searching, browsing and clicking on the web.  Local and mobile bring additional nuances to the equation.

This report is exciting for us here at Predictabuy because it confirms a lot of our own research which is specifically aimed at understanding user behavior in a mobile, local context.  Our research shows:

  1. short term behavior is also a stronger predictor than long term behavior in a mobile, local context;
  2. situational factors such as location, time of day, day of week and weather are very useful in user segmentation; and
  3. advertising performance benefits from dividing users in to  more segments than the number used in the Microsoft study.

via Greg Linden.

Read the full paper for yourself:”How much can Behavioral Targeting Help Online Advertising?” (PDF)

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2 Responses to “Microsoft Researchers Increase CTR 670% Using Behavioral Targeting”


  1. 1 Andrzej Góralczyk October 12, 2009 at 7:24 pm

    Thanks, Eric, for interesting post. Please see my idea of discourse targeting, maybe interesting for You. I have just written in my blog, http://discourseweb.wordpress.com/2009/10/12/discourse-targeting/.

    Regards

    Andrzej


  1. 1 Dicourse targeting « Discourse Web Trackback on October 12, 2009 at 7:19 pm

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