PROSAD

How an advertiser in the travel industry could use PROSAD

We use an example to illustrate how an advertiser in the travel industry could use PROSAD and detail the results and their interpretation below: Assume that the travel advertiser would like to determine its optimal bid for the keyword "cruise vacation". The travel advertiser knows that users search for this keyword 30,000.00 times a day. Each conversion generates a profit contribution of $100.00 and the conversion rate equals 2.00%.

Additionally, the travel advertiser knows from previous experience that to achieve rank 1 (at the top of the screen) he needs to pay $1.50 per click. In contrast, for rank 3 he would only need to pay $1.00. But the clickthrough rate (CTR) also differs for these different ranks: rank 1 has a CTR of 7% and rank 3 has a CTR of 4%.

Thus, the travel advertiser provides the calculator with the following numbers and obtains the corresponding results:


compute

Publication

If you would like to know more about PROSAD, we recommend you to read the following article

Skiera, Bernd / Abou Nabout, Nadia (2012): "PROSAD: A Bidding Decision Support System for PRofit Optimizing Search Engine ADvertising", Marketing Science, 32(2), 213-220, Finalist in the Gary L. Lilien ISMS-MSI Practice Prize Competition.

Marketing Science

Video

If you would like to know more about PROSAD, we recommend you to watch the following video.

MIT Video

Prof. Dr. Bernd Skiera

Bernd Skiera is chaired professor of electronic commerce at Goethe-University in Frankfurt, Germany.

Bernd Skiera

Prof. Dr. Nadia Abou Nabout

Nadia Nabout is Professor of Interactive Marketing & Social Media at Vienna University of Economics and Business (WU Wien), Austria

Nadia Abou Nabout