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How do online ads know what we're looking for?
The more you surf, the more you teach the machine to understand you.
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You are being watched - by machines that learn from your every move on the Internet.

When you look for a hotel in Jakarta online, you likely use a search engine like Google, Yahoo or Bing to find all information you need about the hotel.

However, there is nothing private when you surf the Internet. For every click you make, there is a machine that monitors what you have been up to. This machine is programmed just like a child, except this baby is tracking your activities through the Internet.

As a result, when you open your Facebook page or search for something through Google, in milliseconds, advertisements show up on the side of the page recommending something to buy related to what you were searching for.

Many ads seen online are displayed using machine learning, a type of artificial intelligence (AI) based on observations or set of data, and it learns automatically by some sort of learning algorithm until it finds a pattern.

Basically, the machine learns from what was experienced in the past to make better predictions in future.

Due to the primacy of the Internet, online advertising is increasingly important for businesses - not only because it is less expensive than digital media, but also it is more efficient and benefits the advertisers.

Ad publishers like Google and Facebook charge advertisers for ads that users view or click on. Advertisers are willing to spend a lot just to get their ads online - up to US$70 (S$90) per click - giving publishers plenty of reason to invest in machine-learning research. It is central to the multi-billion dollar online advertising industry, since about 96 per cent of Google's revenue comes from advertising.

So, how does it work with the search engines?

When a user searches for X, an initial set of candidate ads is matched to the query based on advertiser-chosen keywords. Further, there is an auction mechanism to decide whether these ads are shown to the user, what order they are shown in, and what prices the advertisers pay if their ad is clicked.

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