Design a Auction System for Online Advertising

Functional Requirements

1. User Management

   • Advertisers: Ability to register, login, and manage their accounts.
   • Publishers: Ability to register, login, and manage their accounts.
   • Admin: Ability to manage users, auctions, and system settings.

2. Auction Management

   • Create Auction: Advertisers can create auctions for their ad slots.
   • Bid Submission: Advertisers can submit bids for available ad slots.
   • Bid Evaluation: System evaluates bids based on predefined criteria (e.g., highest bid wins).
   • Auction Closure: Automatically close auctions after a specified time or when conditions are met.

3. Ad Delivery

   • Ad Selection: Select winning ad based on auction results.
   • Ad Display: Deliver the selected ad to the appropriate publisher's site.

4. Reporting and Analytics

   • Performance Metrics: Provide advertisers and publishers with metrics like impressions, clicks, and conversions.
   • Financial Reports: Generate reports on spending, earnings, and auction outcomes.

5. Payment Processing

   • Billing: Calculate and process payments for winning bids.
   • Invoicing: Generate invoices for advertisers and payment receipts for publishers.

6. Notification System

   • Alerts: Notify users about auction status, bid outcomes, and payment confirmations.

Non-Functional Requirements

1. Scalability

   • The system should handle a large number of concurrent users and auctions without performance degradation.

2. Performance

   • Real-time processing of bids and ad delivery to ensure minimal latency.

3. Reliability

   • Ensure high availability and fault tolerance to minimize downtime.

4. Security

   • Protect user data and transactions with encryption and secure authentication mechanisms.

5. Data Consistency

   • Ensure data integrity across all components, especially during bid processing and auction closure.

6. Extensibility

   • Design the system to easily incorporate new features or support additional ad formats in the future.

7. Interoperability

   • Ensure compatibility with various ad formats and third-party systems for ad delivery and analytics.

8. Latency

   • Minimize the time taken from bid submission to ad delivery to enhance user experience.

9. Throughput

   • Support a high volume of transactions per second, especially during peak times.