Predictive client-side profiles for personalized advertising

Personalization is ubiquitous in modern online applications as it provides significant improvements in user experience by adapting it to inferred user preferences. However, there are increasing concerns related to issues of privacy and control of the user data that is aggregated by online systems to power personalized experiences. These concerns are particularly significant for user profile aggregation in online advertising. This paper describes a practical, learning-driven client-side personalization approach for keyword advertising platforms, an emerging application previously not addressed in literature. Our approach relies on storing user-specific information entirely within the user's control (in a browser cookie or browser local storage), thus allowing the user to view, edit or purge it at any time (e.g., via a dedicated webpage). We develop a principled, utility-based formulation for the problem of iteratively updating user profiles stored client-side, which relies on calibrated prediction of future user activity. While optimal profile construction is NP-hard for pay-per-click advertising with bid increments, it can be efficiently solved via a greedy approximation algorithm guaranteed to provide a near-optimal solution due to the fact that keyword profile utility is submodular: it exhibits the property of diminishing returns with increasing profile size.

We empirically evaluate client-side keyword profiles for keyword advertising on a large-scale dataset from a major search engine. Experiments demonstrate that predictive client-side personalization allows ad platforms to retain almost all of the revenue gains from personalization even if they give users the freedom to opt out of behavior tracking backed by server-side storage. Additionally, we show that advertisers can potentially increase their return on investment significantly by utilizing bid increments for keyword profiles in their ad campaigns.