Jointly Learning Prices and Product Features

Jointly Learning Prices and Product Features

Ehsan Emamjomeh-Zadeh, Renato Paes Leme, Jon Schneider, Balasubramanian Sivan

Proceedings of the Thirtieth International Joint Conference on Artificial Intelligence
Main Track. Pages 2360-2366. https://doi.org/10.24963/ijcai.2021/325

Product Design is an important problem in marketing research where a firm tries to learn what features of a product are more valuable to consumers. We study this problem from the viewpoint of online learning: a firm repeatedly interacts with a buyer by choosing a product configuration as well as a price and observing the buyer's purchasing decision. The goal of the firm is to maximize revenue throughout the course of $T$ rounds by learning the buyer's preferences. We study both the case of a set of discrete products and the case of a continuous set of allowable product features. In both cases we provide nearly tight upper and lower regret bounds.
Keywords:
Machine Learning: Online Learning
Agent-based and Multi-agent Systems: Economic Paradigms, Auctions and Market-Based Systems