LBM: Hierarchical Large Auto-Bidding Model via Reasoning and Acting
Organizations: Kuaishou Technology Beijing, China · Nanyang Technological University Singapore, Singapore
Abstract
The growing scale of ad auctions on online advertising platforms has intensified competition, making manual bidding impractical and necessitating auto-bidding to help advertisers achieve their economic goals. Current auto-bidding methods have evolved to use offline reinforcement learning or generative methods to optimize bidding strategies, but they can sometimes behave counterintuitively due to the black-box training manner and limited mode coverage of datasets, leading to challenges in understanding task status and generalization in dynamic ad environments. Large language models (LLMs) offer a promising solution by leveraging prior human knowledge and reasoning abilities to improve auto-bidding performance. However, directly applying LLMs to auto-bidding faces difficulties due to the need for precise actions in competitive auctions and the lack of specialized auto-bidding knowledge, which can lead to hallucinations and suboptimal decisions. To address these challenges, we propose a hierarchical Large autoBidding Model (LBM) to leverage the reasoning capabilities of LLMs for developing a superior auto-bidding strategy. This includes a high-level LBM-Think model for reasoning and a low-level LBM-Act model for action generation. Specifically, we propose a dual embedding mechanism to efficiently fuse two modalities, including language and numerical inputs, for language-guided training of the LBM-Act; then, we propose an offline reinforcement fine-tuning technique termed GQPO for mitigating the LLM-Think's hallucinations and enhancing decision-making performance without simulation or real-world rollout like previous multi-turn LLM-based methods. Experiments demonstrate the superiority of a generative backbone based on our LBM, especially in an efficient training manner and generalization ability.
Figures & tables
| AuctionNet | USCB | CQL | IQL | BCQ | DT | DT-Q | DiffBid | DiffBid-Q | LBM(P) | LBM(GQPO) | |
| Dense | Conversions ( ) | 267 | 336 | 322 | 321 | 364 | 371 | 316 | 319 | 376 3.0 | 382 3.3 |
| Score ( ) | 157 | 171 | 281 | 270 | 329 | 334 | 214 | 260 | 320 2.2 | 348 2.3 | |
| Sparse | Conversions ( ) | 28.5 | 30.2 | 36.0 | 31.1 | 31.3 | 33.8 | 31.3 | 31.5 | 37.4 0.3 | 38.5 0.3 |
| Score ( | 17.5 | 22.2 | 30.0 | 30.5 | 29.6 | 31.1 | 23.1 | 25.1 | 32.9 0.2 | 33.4 0.2 |
| Method | Budget Utilization ( ) | CPA Ratio ( ) | Conversions ( ) | Score ( ) | |||||
| Dense | Sparse | Dense | Sparse | Dense | Sparse | Dense | Sparse | ||
| LLM | Prompting | 0.743 | 0.722 | 0.878 | 0.903 | 289 | 24.2 | 286 | 23.4 |
| SFT | 0.765 | 0.741 | 0.882 | 0.804 | 297 | 27.0 | 286 | 26.9 | |
| GRPO | 0.860 | 0.773 | 0.945 | 0.816 | 327 | 29.9 | 292 | 29.7 | |
| LLM-DT | 0.902 | 0.861 | 0.936 | 0.847 | 366 | 36.0 | 328 | 32.5 | |
| Prompt-LLM-DT | 0.914 | 0.970 | 0.931 | 0.965 | 355 | 35.8 | 322 | 30.3 | |
| DT-score | LBM | |||||
| Reweight | 0 | 0.1 | 0.2 | 0.5 | 1.0 | |
| Budget Utlization ( ) | 0.884 | 0.839 | 0.818 | 0.780 | 0.632 | 0.938 |
| CPA Ratio ( ) | 0.895 | 0.846 | 0.826 | 0.831 | 0.725 | 0.960 |
| Conversions ( ) | 364 | 354 | 352 | 329 | 278 | 382 |
| Score ( ) | 329 | 340 | 343 | 323 | 276 | 348 |
| Instruction | Budget Utilization( ) | CPA Ratio( ) | Conversions( ) | Score( ) |
|---|---|---|---|---|
| Increase | 0.969 | 1.028 | 368 | 315 |
| Decrease | 0.894 | 0.924 | 373 | 325 |
| base | 0.938 | 0.960 | 382 | 348 |
| Budget Ratio | 0.5 | 0.75 | 1.0 | 1.25 | 1.5 | |
|---|---|---|---|---|---|---|
| Dense | DT | 186 | 234 | 364 | 393 | 445 |
| LBM(P) | 198 | 285 | 376 | 462 | 520 | |
| Sparse | DT | 18.2 | 27.5 | 31.3 | 43.5 | 50.0 |
| LBM(P) | 21.3 | 28.5 | 37.4 | 43.6 | 50.6 |
| Dense | Sparse | |||
|---|---|---|---|---|
| Model Size | Conversions | Score | Conversions | Score |
| 3B | 376 | 320 | 37.4 | 32.9 |
| 7B | 375 | 320 | 37.3 | 34.6 |
| 32B | 374 | 318 | 37.1 | 33.5 |
Appendix figures & tables6 assets
Supplementary material from the paper’s appendix.
Appendix
| Params | AuctionNet | AuctionNet-Sparse |
|---|---|---|
| Trajectories | 479,376 | 479,376 |
| Delivery Periods | 9,987 | 9,987 |
| Time steps in a trajectory | 48 | 48 |
| State dimension | 16 | 16 |
| Action dimension | 1 | 1 |
| Action range | [0, 493] | [0, 8178] |
| LBM-Think | LBM-Act | |||
| #params | 3B | 7B | 32B | 0.5B |
| Inference Latency | 2.5s | 3.6s | 8.9s | 63ms |
| Hyperparameters | Value |
|---|---|
| Batch size | 128 |
| Number of steps | 400000 |
| Sequence length | 10 |
| Learning rate | 1e-4 |
| Number of attention layers | 6 |
| Number of heads | 8 |
Automated Bidding
Automated bidding studies algorithms that choose auction bids over time while balancing value, budgets, and performance constraints.
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