Airbnb, Inc.
SMART METHODS AND ALGORITHMS FOR TIME-BASED VALUATION OF ONLINE SEARCH KEYWORDS

Abstract:

A lifetime value estimation of a web-based advertisement can be generated at the time of creation of a reservable listing in response to the advertisement, even when little to no information about conversion of the reservable listing is available. In a case that there is no information about a conversion time for a listing, the estimation of the lifetime value is done by calculating a real conversion rate from an advertising platform-dependent historical conversion rate, an average percentage of converted listings that converted from unreserved to reserved within a set period of days, and a scaling multiplier. Where there are relatively few conversions, the estimation of a lifetime value for the advertisement can be done using a weighted average of a campaign-level global conversion rate, which encompasses a large number of keywords that have seen conversions, and a keyword-level local conversion rate. The resulting estimated valuation, by either method, is used to submit a keyword bid to an online advertising service for display alongside a user's search results.