A Framework for Multi-stage Bonus Allocation in meal delivery Platform

TL;DR

This paper introduces a multi-stage bonus allocation framework for meal delivery platforms to reduce order cancellations by optimizing driver incentives using a combination of probabilistic modeling, dynamic programming, and online algorithms.

Contribution

It proposes a novel framework integrating a semi-black-box acceptance model, a Lagrangian dual-based dynamic programming approach, and an online allocation algorithm for bonus distribution.

Findings

Order cancellations decreased by over 25% using the framework.

The approach effectively balances bonus expenditure and order acceptance.

Offline and online experiments validate the framework's efficiency.

Abstract

Online meal delivery is undergoing explosive growth, as this service is becoming increasingly popular. A meal delivery platform aims to provide excellent and stable services for customers and restaurants. However, in reality, several hundred thousand orders are canceled per day in the Meituan meal delivery platform since they are not accepted by the crowd soucing drivers. The cancellation of the orders is incredibly detrimental to the customer's repurchase rate and the reputation of the Meituan meal delivery platform. To solve this problem, a certain amount of specific funds is provided by Meituan's business managers to encourage the crowdsourcing drivers to accept more orders. To make better use of the funds, in this work, we propose a framework to deal with the multi-stage bonus allocation problem for a meal delivery platform. The objective of this framework is to maximize the number of accepted orders within a limited bonus budget. This framework consists of a semi-black-box acceptance probability model, a Lagrangian dual-based dynamic programming algorithm, and an online allocation algorithm. The semi-black-box acceptance probability model is employed to forecast the relationship between the bonus allocated to order and its acceptance probability, the Lagrangian dual-based dynamic programming algorithm aims to calculate the empirical Lagrangian multiplier for each allocation stage offline based on the historical data set, and the online allocation algorithm uses the results attained in the offline part to calculate a proper delivery bonus for each order. To verify the effectiveness and efficiency of our framework, both offline experiments on a real-world data set and online A/B tests on the Meituan meal delivery platform are conducted. Our results show that using the proposed framework, the total order cancellations can be decreased by more than 25\% in reality.