About Auctions

What is an auction and how do they work?

GoWit runs lightning-fast auctions to determine the best ads to show on your platform and calculate how much you make revenue from those ads. Auctions allow brands and vendors to bid for an opportunity to be featured with a “sponsored” tag or appear as a display ad on premium spots on your platform.

When do auctions take place?

Whenever shoppers search for a product on your platform, an auction takes place to determine which ad to show. Depending on the website visits, there could be millions of auctions per minute or just a few times a day.

How is the auction winner determined?

To make sure that the winning ad benefits your marketplace and customers, the winner of the auction is determined in three distinct stages, starting from calculating Quality Score, deriving Bid Score, and ending with the Auction stage. In this way, it is not the advertiser who simply pays the most who will win the auction, but the advertiser with the most relevant brand or product will win the premium ad placement.

In the first step, our systems calculate the Quality Score based on historical data that helps in measuring the performance and relevance of the product, ad or brand to be featured. Various metrics are used to create this score.


What metrics make up the Quality Score?

The quality score is determined according to:

  • Score of the product
  • Number of reviews
  • Seller rating
  • Compatibility of the searched keyword with the product title
  • The compatibility of the searched keyword with the product description
  • Organic ranking of the product in the searched keyword
  • Click-through rate of the product ad in the searched keyword
  • The conversion rate of the product ad on the searched keyword
  • Add-to-cart rate of the product ad in the searched keyword

The weight ratios of metrics in different ad types are calculated using dynamic weighting through machine learning.

The second stage of showing ads starts with the calculation of the Bid Score. In this way, the more each advertiser bids, the more likely they are to win the auctions for high-impact ad placements. Their bid should take into account the benefits of increased visibility and the number of clicks leading to sales, with the cost of paying for those clicks.


How Bid Score is calculated?

The bid score = Quality Score X Bid made for each ad

Having created the total scores and the ad rank, the final stage requires determining the price at which the ad space will be sold.