Evaluating and Optimizing Online Advertising: Forget the Click, but There Are Good Proxies.

Online systems promise to improve advertisement targeting via the massive and detailed data available. However, there often is too few data on exactly the outcome of interest, such as purchases, for accurate campaign evaluation and optimization (due to low conversion rates, cold start periods, lack of instrumentation of offline purchases, and long purchase cycles). This paper presents a detailed treatment of proxy modeling, which is based on the identification of a suitable alternative (proxy) target variable when data on the true objective is in short supply (or even completely nonexistent).