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Refereed Papers
Track: Internet Monetization: Recommendation and Security
Paper Title:
Optimal Marketing Strategies over Social Networks
Authors:
- Jason Hartline(Northwestern University)
- Vahab Mirrokni(Microsoft Resarch)
- Mukund Sundararajan(Stanford University)
Abstract:
We discuss the use of social networks in implementing viral
marketing strategies. While influence maximization has
been studied in this context (see Chapter 24 of [10]), we
study revenue maximization, arguably, a more natural objective.
In our model, a buyer's decision to buy an item is
influenced by the set of other buyers that own the item and
the price at which the item is offered.
We focus on algorithmic question of finding revenue maximizing
marketing strategies. When the buyers are completely
symmetric, we can find the optimal marketing strategy
in polynomial time. In the general case, motivated by
hardness results, we investigate approximation algorithms
for this problem. We identify a family of strategies called
influence-and-exploit strategies that are based on the following
idea: Initially influence the population by giving the
item for free to carefully a chosen set of buyers. Then extract
revenue from the remaining buyers using a 'greedy' pricing
strategy. We first argue why such strategies are reasonable
and then show how to use recently developed set-function
maximization techniques to find the right set of buyers to
influence.
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