Data-Driven Real-time Coupon Allocation in Online Platform

May 16, 2024 11:00 AM Singapore (Registration starts at 10:50 AM)


In this study, we partner with Meituan, a leading shopping platform, to develop a real-time, end-to-end coupon allocation system that aims to maximize customer conversion rate (CVR) while adhering to marketing budgets, addressing challenges of uncertain traffic from a diverse customer base and the need for real-time decision-making. By leveraging comprehensive customer and product features, we estimate CVR under various coupon values and employ isotonic regression to ensure non-increasing predicted CVRs with respect to price. Using calibrated CVR predictions as input, we propose a Lagrangian Dual-based algorithm that efficiently determines optimal coupon values for individual customers upon arrival in O(N) computation time. We assess the effectiveness of our coupon allocation algorithm through a field experiment and historical data. So far, our framework has distributed coupons to over 100 million users in more than 110 major cities in China and increased revenue by 0.7%, which translates to an additional 8 million RMB annual profit for the platform compared to the traditional, offline IP approach.

About the Speaker

Hanwei is an Assistant Professor in the Department of Management Sciences at City University of Hong Kong. He received his Ph.D. in Social and Engineering Systems from the MIT Institute of Data, Systems, and Society (IDSS).  Before attending MIT, he received his bachelor’s degree in Engineering Systems Design at Singapore University of Technology and Design (SUTD). His research explores the combination of econometrics and optimization in empirical operations management with applications in platform operations and revenue management.

For more information about the ESD Seminar, please email