User marketing is a key focus of consumer-based internet companies. Learning algorithms are effective to optimize marketing campaigns which increase user engagement, and facilitates cross-marketing to related products. By attracting users with rewards, marketing methods are effective to boost user activity in the desired products. Rewards incur significant cost that can be off-set by increase in future revenue. Most methodologies rely on churn predictions to prevent losing users to make marketing decisions, which cannot capture up-lift across counterfactual outcomes with business metrics. Other predictive models are capable of estimating heterogeneous treatment effects, but fail to capture the balance of cost versus benefit. We propose a treatment effect optimization methodology for user marketing. This algorithm learns from past experiments and utilizes novel optimization methods to optimize cost efficiency with respect to user selection. The method optimizes decisions using deep learning optimization models to treat and reward users, which is effective in producing cost-effective, impactful marketing campaigns. Our methodology demonstrates superior algorithmic flexibility with integration with deep learning methods and dealing with business constraints. The effectiveness of our model surpasses the quasi-oracle estimation (R-learner) model and causal forests. We also established evaluation metrics that reflect the cost-efficiency and real-world business value. Our proposed constrained and direct optimization algorithms outperform by 24.6% compared with the best performing method in prior art and baseline methods. The methodology is useful in many product scenarios such as optimal treatment allocation and it has been deployed in production world-wide.
We apply causal machine learning algorithms to assess the causal effect of a marketing intervention, namely a coupon campaign, on the sales of a retailer. Besides assessing the average impacts of different types of coupons, we also investigate the heterogeneity of causal effects across different subgroups of customers, e.g., between clients with relatively high vs. low prior purchases. Finally, we use optimal policy learning to determine (in a data-driven way) which customer groups should be targeted by the coupon campaign in order to maximize the marketing intervention's effectiveness in term…
School of Business and Economics, Humboldt-University of Berlin（柏林洪堡大学经济与商学院）；Institute of Computer Science, Polish Academy of Sciences（波兰科学院计算机科学研究所）
Uplift models support decision-making in marketing campaign planning. Estimating the causal effect of a marketing treatment, an uplift model facilitates targeting communication to responsive customers and efficient allocation of marketing budgets. Research into uplift models focuses on conversion models to maximize incremental sales. The paper introduces uplift modeling strategies for maximizing incremental revenues. If customers differ in their spending behavior, revenue maximization is a more plausible business objective compared to maximizing conversions. The proposed methodology entails a …
This article provides an assessment of the causal effect of customer relationship management (CRM) applications on one-to-one marketing effectiveness. We use a potential outcomes based propensity score approach to assess this causal effect. We find that firms using CRM systems have greater levels of one-to-one marketing effectiveness. We discuss the strengths and challenges of using the propensity score approach to design and execute CRM related observational studies. We also discuss the applicability of the framework in this paper to study typical causal questions in business and electronic c…
Propensity score methods were proposed by Rosenbaum and Rubin [Biometrika 70 (1983) 41--55] as central tools to help assess the causal effects of interventions. Since their introduction more than two decades ago, they have found wide application in a variety of areas, including medical research, economics, epidemiology and education, especially in those situations where randomized experiments are either difficult to perform, or raise ethical questions, or would require extensive delays before answers could be obtained. In the past few years, the number of published applications using propensit…
This paper provides a link between causal inference and machine learning techniques - specifically, Classification and Regression Trees (CART) - in observational studies where the receipt of the treatment is not randomized, but the assignment to the treatment can be assumed to be randomized (irregular assignment mechanism). The paper contributes to the growing applied machine learning literature on causal inference, by proposing a modified version of the Causal Tree (CT) algorithm to draw causal inference from an irregular assignment mechanism. The proposed method is developed by merging the C…
Carnegie Mellon University（卡内基梅隆大学）；Lingnan University（岭南大学）；Rutgers University（罗格斯大学）；Max Planck Institute for Intelligent Systems（马克斯·普朗克智能系统研究所）
It is commonplace to encounter heterogeneous or nonstationary data, of which the underlying generating process changes across domains or over time. Such a distribution shift feature presents both challenges and opportunities for causal discovery. In this paper, we develop a framework for causal discovery from such data, called Constraint-based causal Discovery from heterogeneous/NOnstationary Data (CD-NOD), to find causal skeleton and directions and estimate the properties of mechanism changes. First, we propose an enhanced constraint-based procedure to detect variables whose local mechanisms …
Uplift Modeling based on Graph Neural Network Combined with Causal Knowledge
Alipay, AntGroup（支付宝，蚂蚁集团）；Imperial College London（伦敦帝国理工学院）；University College London（伦敦大学学院）；Zhejiang University（浙江大学）；Peking University（北京大学）；Zhejiang Lab（之江实验室）
University of Vienna（维也纳大学）；KTH Royal Institute of Technology（瑞典皇家理工学院）；Indian Institute of Technology Bombay（印度理工学院孟买分校）
We consider the problem of causal structure learning in the setting of heterogeneous populations, i.e., populations in which a single causal structure does not adequately represent all population members, as is common in biological and social sciences. To this end, we introduce a distance covariance-based kernel designed specifically to measure the similarity between the underlying nonlinear causal structures of different samples. Indeed, we prove that the corresponding feature map is a statistically consistent estimator of nonlinear independence structure, rendering the kernel itself a statis…
We address the problem of inferring the causal effect of an exposure on an outcome across space, using observational data. The data is possibly subject to unmeasured confounding variables which, in a standard approach, must be adjusted for by estimating a nuisance function. Here we develop a method that eliminates the nuisance function, while mitigating the resulting errors-in-variables. The result is a robust and accurate inference method for spatially varying heterogeneous causal effects. The properties of the method are demonstrated on synthetic as well as real data from Germany and the US.
Harvard University（哈佛大学）；KU Leuven（鲁汶大学）；IMT School for Advanced Studies（IMT高等研究院）
This paper introduces an innovative Bayesian machine learning algorithm to draw interpretable inference on heterogeneous causal effects in the presence of imperfect compliance (e.g., under an irregular assignment mechanism). We show, through Monte Carlo simulations, that the proposed Bayesian Causal Forest with Instrumental Variable (BCF-IV) methodology outperforms other machine learning techniques tailored for causal inference in discovering and estimating the heterogeneous causal effects while controlling for the familywise error rate (or - less stringently - for the false discovery rate) at…
This work explores the idea of a causal contextual multi-armed bandit approach to automated marketing, where we estimate and optimize the causal (incremental) effects. Focusing on causal effect leads to better return on investment (ROI) by targeting only the persuadable customers who wouldn't have taken the action organically. Our approach draws on strengths of causal inference, uplift modeling, and multi-armed bandits. It optimizes on causal treatment effects rather than pure outcome, and incorporates counterfactual generation within data collection. Following uplift modeling results, we opti…
Forest-based methods have recently gained in popularity for non-parametric treatment effect estimation. Building on this line of work, we introduce causal survival forests, which can be used to estimate heterogeneous treatment effects in a survival and observational setting where outcomes may be right-censored. Our approach relies on orthogonal estimating equations to robustly adjust for both censoring and selection effects under unconfoundedness. In our experiments, we find our approach to perform well relative to a number of baselines.
Ant Group（蚂蚁集团）；University of Georgia（佐治亚大学）；University of Virginia（弗吉尼亚大学）
The era of big data has witnessed an increasing availability of observational data from mobile and social networking, online advertising, web mining, healthcare, education, public policy, marketing campaigns, and so on, which facilitates the development of causal effect estimation. Although significant advances have been made to overcome the challenges in the academic area, such as missing counterfactual outcomes and selection bias, they only focus on source-specific and stationary observational data, which is unrealistic in most industrial applications. In this paper, we investigate a new ind…
University of South Australia（南澳大学）；School of Computer and Information, Hefei University of Science and Technology（合肥理工大学计算机与信息学院）
In many applications, there is a need to predict the effect of an intervention on different individuals from data. For example, which customers are persuadable by a product promotion? which patients should be treated with a certain type of treatment? These are typical causal questions involving the effect or the change in outcomes made by an intervention. The questions cannot be answered with traditional classification methods as they only use associations to predict outcomes. For personalised marketing, these questions are often answered with uplift modelling. The objective of uplift modellin…
Uncovering the heterogeneity of causal effects of policies and business decisions at various levels of granularity provides substantial value to decision makers. This paper develops new estimation and inference procedures for multiple treatment models in a selection-on-observables framework by modifying the Causal Forest approach suggested by Wager and Athey (2018) in several dimensions. The new estimators have desirable theoretical, computational and practical properties for various aggregation levels of the causal effects. While an Empirical Monte Carlo study suggests that they outperform pr…
Centre for Computer Vision, Speech, and Signal Processing（计算机视觉、语音与信号处理中心）；University of Surrey（萨里大学）
Undertaking causal inference with observational data is incredibly useful across a wide range of tasks including the development of medical treatments, advertisements and marketing, and policy making. There are two significant challenges associated with undertaking causal inference using observational data: treatment assignment heterogeneity (\textit{i.e.}, differences between the treated and untreated groups), and an absence of counterfactual data (\textit{i.e.}, not knowing what would have happened if an individual who did get treatment, were instead to have not been treated). We address the…
National University of Singapore（新加坡国立大学）；Roche AG（罗氏公司）；Harvard University（哈佛大学）
We propose a new causal inference framework to learn causal effects from multiple, decentralized data sources in a federated setting. We introduce an adaptive transfer algorithm that learns the similarities among the data sources by utilizing Random Fourier Features to disentangle the loss function into multiple components, each of which is associated with a data source. The data sources may have different distributions; the causal effects are independently and systematically incorporated. The proposed method estimates the similarities among the sources through transfer coefficients, and hence…
This paper develops a sparsity-inducing version of Bayesian Causal Forests, a recently proposed nonparametric causal regression model that employs Bayesian Additive Regression Trees and is specifically designed to estimate heterogeneous treatment effects using observational data. The sparsity-inducing component we introduce is motivated by empirical studies where not all the available covariates are relevant, leading to different degrees of sparsity underlying the surfaces of interest in the estimation of individual treatment effects. The extended version presented in this work, which we name …
Max Planck Institute for Intelligent Systems（马克斯·普朗克智能系统研究所）；University of Cambridge（剑桥大学）
Machine learning approaches commonly rely on the assumption of independent and identically distributed (i.i.d.) data. In reality, however, this assumption is almost always violated due to distribution shifts between environments. Although valuable learning signals can be provided by heterogeneous data from changing distributions, it is also known that learning under arbitrary (adversarial) changes is impossible. Causality provides a useful framework for modeling distribution shifts, since causal models encode both observational and interventional distributions. In this work, we explore the spa…
Causal inference has numerous real-world applications in many domains, such as health care, marketing, political science, and online advertising. Treatment effect estimation, a fundamental problem in causal inference, has been extensively studied in statistics for decades. However, traditional treatment effect estimation methods may not well handle large-scale and high-dimensional heterogeneous data. In recent years, an emerging research direction has attracted increasing attention in the broad artificial intelligence field, which combines the advantages of traditional treatment effect estimat…
Performing inference on data obtained through observational studies is becoming extremely relevant due to the widespread availability of data in fields such as healthcare, education, retail, etc. Furthermore, this data is accrued from multiple homogeneous subgroups of a heterogeneous population, and hence, generalizing the inference mechanism over such data is essential. We propose the MetaCI framework with the goal of answering counterfactual questions in the context of causal inference (CI), where the factual observations are obtained from several homogeneous subgroups. While the CI network …
Didi Chuxing（滴滴出行）；University of North Carolina at Chapel Hill（北卡罗来纳大学教堂山分校）
Uplift modeling is a rapidly growing approach that utilizes causal inference and machine learning methods to directly estimate the heterogeneous treatment effects, which has been widely applied to various online marketplaces to assist large-scale decision-making in recent years. The existing popular models, like causal forest (CF), are limited to either discrete treatments or posing parametric assumptions on the outcome-treatment relationship that may suffer model misspecification. However, continuous treatments (e.g., price, duration) often arise in marketplaces. To alleviate these restrictio…
In the era of big data, the explosive growth of multi-source heterogeneous data offers many exciting challenges and opportunities for improving the inference of conditional average treatment effects. In this paper, we investigate homogeneous and heterogeneous causal data fusion problems under a general setting that allows for the presence of source-specific covariates. We provide a direct learning framework for integrating multi-source data that separates the treatment effect from other nuisance functions, and achieves double robustness against certain misspecification. To improve estimation p…
This study provides a formal analysis of the customer targeting problem when the cost for a marketing action depends on the customer response and proposes a framework to estimate the decision variables for campaign profit optimization. Targeting a customer is profitable if the impact and associated profit of the marketing treatment are higher than its cost. Despite the growing literature on uplift models to identify the strongest treatment-responders, no research has investigated optimal targeting when the costs of the treatment are unknown at the time of the targeting decision. Stochastic cos…
Stanford University（斯坦福大学）；Microsoft Research（微软研究院）；U.S. Bureau of Economic Analysis（美国经济分析局）
Estimating heterogeneous treatment effects in domains such as healthcare or social science often involves sensitive data where protecting privacy is important. We introduce a general meta-algorithm for estimating conditional average treatment effects (CATE) with differential privacy (DP) guarantees. Our meta-algorithm can work with simple, single-stage CATE estimators such as S-learner and more complex multi-stage estimators such as DR and R-learner. We perform a tight privacy analysis by taking advantage of sample splitting in our meta-algorithm and the parallel composition property of differ…
Solvay Business School（索尔维商学院）；Vrije Universiteit Brussel（布鲁塞尔自由大学）；Faculty of Economics and Business（经济与商业学院）；Katholieke Universiteit Leuven（鲁汶大学）
Causal classification models are adopted across a variety of operational business processes to predict the effect of a treatment on a categorical business outcome of interest depending on the process instance characteristics. This allows optimizing operational decision-making and selecting the optimal treatment to apply in each specific instance, with the aim of maximizing the positive outcome rate. While various powerful approaches have been presented in the literature for learning causal classification models, no formal framework has been elaborated for optimal decision-making based on the e…
We consider the problem of causal discovery (structure learning) from heterogeneous observational data. Most existing methods assume a homogeneous sampling scheme, which leads to misleading conclusions when violated in many applications. To this end, we propose a novel approach that exploits data heterogeneity to infer possibly cyclic causal structures from causally insufficient systems. The core idea is to model the direct causal effects as functions of exogenous covariates that properly explain data heterogeneity. We investigate structure identifiability properties of the proposed model. Str…
Estimating how a treatment affects units individually, known as heterogeneous treatment effect (HTE) estimation, is an essential part of decision-making and policy implementation. The accumulation of large amounts of data in many domains, such as healthcare and e-commerce, has led to increased interest in developing data-driven algorithms for estimating heterogeneous effects from observational and experimental data. However, these methods often make strong assumptions about the observed features and ignore the underlying causal model structure, which can lead to biased HTE estimation. At the s…
