In growth marketing, a multi-armed bandit is a tool that helps you optimize your conversion rate by testing different versions of your landing page or website. The idea is that you can explore by testing different versions of your page, and exploit by showing the version that performs the best.
There are several benefits to using a multi-armed bandit. First, it can help you optimize your conversion rate by finding the best performing version of your page. Second, it can help you save time and money by avoiding the need to run multiple A/B tests. Third, it can help you avoid the risk of local optimum, where you might settle for a sub-optimal solution because you didn't explore enough.
There are several different types of multi-armed bandits. The most common type is the Epsilon-greedy bandit, which explores a new version of the page with a small probability (epsilon), and exploits the best performing version with a large probability (1-epsilon). There are also softmax bandits, which use a probability distribution to decide whether to explore or exploit, and UCB bandits, which use a upper confidence bound to decide whether to explore or exploit.
There are several ways to use a multi-armed bandit. The most common way is to use an online service such as Optimizely or Visual Website Optimizer. These services provide a user interface that allows you to create different versions of your page, and then track the performance of each version.
There are several pros and cons to using a multi-armed bandit. The main pro is that it can help you optimize your conversion rate by finding the best performing version of your page. The main con is that it can be time-consuming to set up and track the performance of multiple versions of your page.