Incremental Profit per Conversion: a Response Transformation for Uplift Modeling in E-Commerce Promotions. (arXiv:2306.13759v2 [cs.LG] UPDATED)

Promotions play a crucial role in e-commerce platforms, and various cost
structures are employed to drive user engagement. This paper focuses on
promotions with response-dependent costs, where expenses are incurred only when
a purchase is made. Such promotions include discounts and coupons. While
existing uplift model approaches aim to address this challenge, these
approaches often necessitate training multiple models, like meta-learners, or
encounter complications when estimating profit due to zero-inflated values
stemming from non-converted individuals with zero cost and profit. …

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