Analyze Trade-off Between DAU Growth and Ad Revenue

Q: Analyze Trade-off Between DAU Growth and Ad Revenue

This question evaluates a data scientist's competency in metrics decomposition, causal inference, experimentation, and trade-off analysis between product engagement and ad monetization.

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Question

Analytics Case: DAU vs. Ad Revenue Trade-off in a Consumer Video App

Context

You are a data scientist supporting a simple in-feed ads product for a large consumer video app. Leadership is debating whether to increase ad load/pacing (to raise ad revenue) or prioritize product changes that boost daily active users (DAU) and engagement. You need to evaluate the trade-offs and propose how to measure and make decisions.

Task

Describe how you would analyze the trade-off between boosting DAU and optimizing ad revenue. Cover:

Metrics to monitor and how they decompose revenue/engagement drivers.
Experiment designs (and guardrails) to estimate causal impact.
Analyses you would run, including retention, ARPU/ARPDAU, ad-load elasticity, LTV, cohort analysis, and marginal impact on engagement.
A decision framework to choose the optimal policy.

Analyze Trade-off Between DAU Growth and Ad Revenue

Analytics Case: DAU vs. Ad Revenue Trade-off in a Consumer Video App

Context

Task

Solution

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Analyze Trade-off Between DAU Growth and Ad Revenue

Overview

Analytics Case: DAU vs. Ad Revenue Trade-off in a Consumer Video App

Context

Task

Solution

Comments (0)