Advertisement Markets
The article touches on the topic of advertisements and how the market holds a massive number of customers and bidders in which customers are sold in milliseconds. In simple terms, it is described that every person on the internet who clicks on websites, is tracked and sold to the highest bidder. The winner of the real time bid is allowed to present that customer with their ad. The auction is administered through many third company websites, a common one being Rubicon. The amount of information that is collected from a person is so accurate that once a person clicks on a website, they are placed into a category for the bidders and they can see who is high income; as well as whether the person is a “shopaholic” or a penny pincher. In addition, along with the information collected, the auction does not collect personal names and instead assigns each person with an ID. The reason for IDs instead of names is to prevent collecting personal information and is a way third party companies avoid legal issues that involve customer privacy.
Upon reading this article, it opened my eyes to see how much information is being collected without us knowing. I was not aware that my activity on the internet was being monitored by companies in order for me to be auctioned off to the highest bidder, only for me to see their advertisements. This explains why I receive oddly personalized advertisements when I am shopping for school supplies or even shoes. With this new knowledge, I am more wary of what websites I accept cookies for and will constantly worry if I am being sold to a bidder just because of my personal activities online.
When I came across this article, I was reminded of class when we learned about auctions that involve advertisements and who gets what slot with the highest traffic. This article was a more in depth view of how one online auction platform operates and what type of information is collected from people. Additionally, the examples and situations we went over in class turned out to be a very simplified model of how these auctions really go down. However, the article did not go into too much detail about what type of auctions they used such as first price auctions or second price auctions. I was also not aware that the matching market is done within milliseconds and that shocked me because I thought it was minutes to decide which bidder will win. One thing that I am still curious about is how VCG fits into these auctions? What can you do with the value of VCG in terms of what can bidders do with this information and how they can leverage that information into their own agenda?