Optimal mobile App advertising keyword auction model with variable costs

With the rapid development of mobile App advertising, how to allocate App advertising more reasonable is now need to be studied. This paper proposes an App advertising auction mechanism based on optimal keyword auctions. First, we analyze the development trend of the App advertising and obtain the result that the core competitiveness of mobile advertising lies in the precise. Next, we describe the App advertising auction mechanism in detail. The advertising click-through rate only depends on the location of the premise and per-click cost. In considering the premise of taking the variable costs of App advertising slots into account, we put forward optimal keyword auctions model. A mathematical analysis is used to get the expected revenues of advertisers, advertising alliance platform and App developers. Finally, we use the expected revenue expressions to analyze the feasibility properties of the model and give corresponding proof. According to the results of our analysis, we can better guide App advertising and maximum revenue of any equilibrium of this dynamic auction. In order to closer to the actual situation, our model also takes the individual rationality, incentive compatibility properties into account to prove the feasibility of the mechanism.