Optimizing the Frequency Capping: A Robust and Reliable Methodology to Define the Number of Ads to Maximize ROAS

Abstract

The goal of digital marketing is to connect advertisers with users that are interested in their products. This means serving ads to users, and it could lead to a user receiving hundreds of impressions of the same ad. Consequently, advertisers can define a maximum threshold to the number of impressions a user can receive, referred to as Frequency Cap. However, low frequency caps mean many users are not engaging with the advertiser. By contrast, with high frequency caps, users may receive many ads leading to annoyance and wasting budget. We build a robust and reliable methodology to define the number of ads that should be delivered to different users to maximize the ROAS and reduce the possibility that users get annoyed with the ads’ brand. The methodology uses a novel technique to find the optimal frequency capping based on the number of non-clicked impressions rather than the traditional number of received impressions. This methodology is validated using simulations and large-scale datasets obtained from real ad campaigns data. To sum up, our work proves that it is feasible to address the frequency capping optimization as a business problem, and we provide a framework that can be used to configure efficient frequency capping values.

Keywords

• impressions
• clicks
• frequency capping
• conversion rate
• digital marketing