From Feature Interaction to Feature Transport - A Unified Block for Scalable Recommendation Models

Unified recommendation models aim to jointly model non-sequential multi-field features and sequential user behaviors, but existing interaction-centric designs mainly focus on mixing heterogeneous tokens within each layer. We argue that scalable unified recommendation also requires controlling how intent information is carried, filtered, and preserved across stacked blocks. Inspired by flow-based representation dynamics, we introduce feature transport, a view that treats deep unified recommendation as a discrete context-conditioned representation evolution process. We propose CRAFT, a Contextual Residual Adaptive Feature Transport block, which summarizes non-sequential features into a reliability-aware contextual field and uses it to generate residual displacement and memory-preserving signals for intent and sequence representations. In this way, non-sequential context acts as an active controller of representation evolution rather than a passive object of interaction. In the TAAC2026 advertising recommendation competition, CRAFT achieves a test AUC of 0.838090, surpassing the previous leaderboard-best score of 0.83798. Scaling experiments further show that CRAFT benefits from both depth and width expansion: stacking CRAFT to six blocks improves test AUC to 0.838148, while increasing the hidden dimension reaches 0.838106. These results demonstrate the effectiveness, scalability, and generalization potential of the feature transport paradigm. Source code: https://github.com/AshleyLuo001/CRAFT

PRIME: Mitigating Subgroup Optimization Competition in Shared CTR Top Networks with Plug-in Residual Input-Conditioned Mixture of Expert

Click-through rate (CTR) models vary in feature-interaction design, yet their top networks usually remain a single multilayer perceptron shared by all examples. Heterogeneous user, item, and context subgroups therefore update the same parameters; weakly aligned learning signals make the aggregate gradient a compromise among competing directions. We study the competition on Avazu with 4 models and 4 semantic fields. Across all architectures, semantic subgroups show lower Top-NN gradient cosine similarity than random groups matched by sample size and label ratio, with reductions of 0.23-0.37. This competition motivates input-conditioned experts, but directly replacing an established Dense mapping changes its initial function, sharing pattern, and capacity, obscuring the source of gains. We introduce PRIME (Plug-in Residual Input-conditioned Mixture of Experts), a Dense-anchored mixture of low-rank residual experts. PRIME anchors the original prediction and uses zero-residual initialization to match the Dense baseline exactly at training onset. Input-dependent routing weights low-rank experts for example-specific logit corrections; multi-bag aggregation and EMA load biases stabilize conditional estimation. We evaluate PRIME on held-out Avazu and Criteo test sets across 13 CTR architectures and five paired seeds. Median paired AUC gains are +0.0022 and +0.0066, with LogLoss reductions of 0.0011 and 0.0081, respectively. On FiBiNET and DCNv2, PRIME outperforms APG in all ten seed-level AUC comparisons while using fewer parameters and lower inference latency on both backbones. These results show that function-preserving conditional residuals add input-dependent capacity while preserving the Dense path and its optimization stability. Code is available at https://github.com/YH-learning/PRIME.

Learning to Allocate Incentives for Incentivized Advertising via Offline Model-Based Reinforcement Learning

Complete your ad view and grab a 5-cent bonus! In incentivized advertising, a platform promises users a bonus before observing downstream ad revenue, encouraging them to click and complete ads. It must balance the incentive promised in advance against the revenue realized afterward: insufficient incentives forfeit monetization opportunities, whereas excessive incentives reduce net profit. Because current incentives may also shape user expectations and future engagement, incentive allocation is a sequential decision problem with delayed revenue, cost sensitivity, and carryover effects. Existing work has not studied decision-making algorithms for this setting. Auto-bidding assumes available ad opportunities, while targeted promotion optimizes incentives outside the ad monetization pipeline. We formulate the problem as an MDP and develop an offline model-based RL framework for cost-controllable sequential incentive allocation. It learns a world model of user feedback and ad revenue, then performs conservative policy optimization. An independent counterfactual scorer evaluates each learned policy on held-out logs, enabling pre-launch selection without costly online exposure. Experiments on large-scale industrial data and online A/B tests show that the scorer provides a stable offline signal. The deployment path from causal inference to offline RL and then Offline-MBRL further validates the framework: MB-IQL improves per-user net profit by 7.96\% over TD3+BC, whereas reverting to plain IQL reduces it by 6.56\% (both \(p<0.0001\)).

Token-Level Advertising

Generative AI is transforming how people access information, challenging traditional advertising mechanisms built around predefined slots. Towards generation-native advertising, we propose the Latent Advertiser Mixture Auction (LAMA), a token-level advertising mechanism that embeds advertiser influence directly into the generation process. Advertisers report local continuation values that induce advertiser-specific next-token policies, from which the platform decodes through a latent mixture while updating an allocation posterior. We show that LAMA satisfies Markov DSIC and IR, and achieves near-optimal KL-regularized welfare. We further develop a learning-based implementation that reconstructs the required reports online from learned local advantages and root values. Proof-of-concept experiments on real-world commercial-search query splits show that LAMA improves platform welfare and revenue while maintaining user-facing response quality, providing initial evidence for the feasibility of generation-native advertising.

GeoReward: Mitigating Contextual Variable Overestimation in Vision-Language Models for Cross-Market Preference Prediction

Vision-language models excel in many multimodal tasks but remain prone to a subtle yet impactful failure mode: they tend to overestimate dominant visual-textual cues while underestimating sparse but decision-critical contextual variables. This issue, which we term Contextual Variable Overestimation (CVE), becomes particularly evident in real-world applications such as predicting advertisement image preferences across diverse geographic markets. For instance, when a VLM is asked to choose between two product images tailored for different countries, it often defaults to a consistent output, ignoring ground-truth regional variations. This collapse occurs because pervasive high-volume signals, such as product attributes and dense image patches, overwhelm the few but critical tokens that encode market-specific context. To address CVE, we first collect a new multimodal dataset of real advertising creatives and their click-through performance across multiple countries. We then introduce GeoReward, a reward model designed to predict ad image preferences across diverse geographic markets. GeoReward integrates three purpose-built mechanisms: (1) Market-Aware Retrieval Augmentation, (2) Context-Guided Visual Modulation, (3) Selective Sensitivity Loss. Furthermore, we demonstrate how GeoReward can guide the fine-tuning of RL for a VLM to generate background designs for text-to-image models, producing market-aware advertising creatives. Experiments validate that our framework mitigates CVE and outperforms existing baselines. This work not only diagnoses a systematic bias in VLMs toward dominant perceptual features but also delivers a targeted solution for applications where sparse contextual variables govern decision-making.

LLM-OSDA: An Optimal-Stopping Dynamic Auction for Native Advertising in Multi-Turn LLM Conversations

LLM-native advertising embeds sponsored content directly into model-generated responses, shifting the unit of sale from a fixed slot to a moment within an evolving conversation. Existing LLM ad-auction mechanisms primarily operate within a single response, settling the winner but not the timing. The extension is nontrivial: with one native insertion opportunity per session, the stopping time depends on bids, coupling timing with allocation, so static truthfulness arguments no longer apply. We propose the LLM-based Optimal Stopping Dynamic Auction (LLM-OSDA), a dynamic cost-per-click auction that integrates Bellman optimal stopping, winner allocation, and envelope pricing. A bid-independent LLM layer estimates contextual click quality and seamlessly renders the winning ad, while bids enter only the committed auction mechanism. Under an exact Bellman oracle, the expected discounted-click allocation is monotone in each advertiser's bid, and the corresponding envelope payment makes truthful bidding weakly dominant in expectation. For practical deployment, a learned StopNet approximates the Bellman action values. We show that its decisions differ from the optimal policy only near the stopping boundary and bound the resulting incentive loss in terms of its approximation error. Experiments on a simulated conversational advertising corpus show that LLM-OSDA improves net revenue by 11 percent over the strongest fixed-timing baseline while maintaining comparable user retention. Code is at https://github.com/2025Fang2025/llm-osda.

Evaluating and Pricing Advertisements in AI-Generated Responses

As search increasingly shifts toward LLM-driven answer engines, advertising is becoming embedded within the generated response itself and should therefore be evaluated for both user utility and commercial value. The key challenge is click-through intent: behavioural logs are unavailable, human annotation resists calibration, and frontier LLM judges conflate intent with linguistic fluency. These gaps compound, as principled pricing presupposes a continuous intent signal, while generating such a signal presupposes supervision that is currently unavailable. We construct the missing supervision through a psychologically grounded agent simulation framework, and distil it into a parameter-efficient evaluator that predicts click-through intent, together with the three companion dimensions of ad quality, as smooth, differentiable estimates. Validated through sign-certain behavioural perturbations, the evaluator surpasses frontier zero-shot judges on relevance sensitivity (79% versus 60-67%), tracks graded content degradation, generalises without error to 103 fictional products, and agrees with human preference in 86% of pairwise judgements across five annotators, with agreement rising in the evaluator's confidence. Upon its estimates we build the pricing layer directly, deriving the unique payment rule under which truthful bidding is optimal, demonstrating it on a best-of-k allocation, and extending the mechanism to non-monotone allocations. The same differentiable signal stands ready as a training objective for ad generation.

Sense it with your eyes: Sensation Generation and Understanding for Advertisements

Sensory advertising evokes human senses through visual cues, enabling audiences to mentally simulate experiences and increasing persuasive impact. Despite the recent increase in using AI in generating and understanding creative and persuasive content, how advertisements visually evoke sensations remains largely unexplored. In this work, we introduce the first study of understanding, evaluating, and generating sensory ads. We introduce the Sensory Ad dataset, and define sensation classification tasks (SenseClass) to benchmark LLMs and MLLMs. We further propose SenseScore, an automated evaluation metric for sensation evocation achieving strong agreement with human judgments. Finally, we introduce the Sensory Ad Generation (SenseGen) task and propose SAGA, a multi-agent framework that improves message image alignment, sensory evocation, and persuasion. Our work establishes a foundation for sensory-aware visual persuasion.

ScaleToT: Generalizing Structured LLM Reasoning for Billion-Scale Low-Activity User Modeling

Accurate user modeling often depends on rich interaction histories, which are unavailable for billions of low-activity users. Large Language Models (LLMs) can infer latent user states from static profiles, but this reasoning becomes unreliable when profiles are sparse, and applying an LLM to billions of users is prohibitively expensive. We present ScaleToT, which learns structured reasoning from a small LLM-processed subset and extends it to the broader low-activity user population. To improve reasoning reliability, ScaleToT constructs typed user-state chains with a bounded entropy-guided Tree-of-Thought (ToT) refinement procedure. To make this structured reasoning usable from sparse profiles, the teacher-curated chains are used to train a student model on static profiles through supervised fine-tuning (SFT) and Outcome-Driven Segment-Aware Implicit Reward Policy Optimization (OSIPO). ScaleToT then transfers the student's reasoning representations to a lightweight profile encoder, providing shared reasoning signals for the remaining users without LLM inference. We evaluate ScaleToT on lifetime value (LTV) prediction in a billion-scale advertising deployment. A randomized online A/B test increased LT30 by 6.738\%, while offline reasoning covered only 7.32\% of the potential population, greatly reducing compute cost compared with full-population reasoning.