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Additional Online info at Business Week

There is an additional article online (only) associated with the “Math will Rock Your World” article in Business Week. Entitled Search Advertising by the Numbers, the article concentrates on the problem of bidding on keywords. Here is a quote:

Khan, an accountant by training, looks at the process like a linear programming problem. That may sound exotic to mathophobes, but the concept is simple. He sets a goal that he aims to maximize. In Khan’s case, that’s revenue. Then he factors in the constraints, such as cost per keyword.

This can get complicated. If he bids for the word “loan,” for example, he competes with much of the lending industry. That drives up the price. What’s more, it’s a big, broad word, which means the results are much more complex than a far cheaper targeted keyword phrase such as “Tuscaloosa mortgage.”

“If we can get one dollar out of an auto loan, we can get $20 if we do a mortgage loan,” Khan says. “A keyword like ‘loan’ can deliver either of the two products. So should we buy the keyword based on potential of auto loan or mortgage loan?” He has his team do the math

As always, the article doesn’t go into any real detail of models or algorithms, but it does make our field much more visible.