# Define Marketplace Success Metrics and Investigate Their Movement A two-sided live-commerce marketplace asks you to define success metrics. A primary metric changes unexpectedly, and the team needs a diagnosis that distinguishes product impact from changes in buyers, sellers, inventory, and measurement. ### Constraints & Assumptions - Buyers can transact with multiple sellers and sellers can list multiple items. - The metric may be a rate, so numerator and denominator must be investigated separately. - Promotions and supply mix can change at the same time as product behavior. - Late transaction and refund events can revise historical values. ### Clarifying Questions to Ask - Which marketplace decision will the metric support? - Is success short-term conversion, healthy repeat behavior, liquidity, or contribution margin? - At what grain and delay are orders, refunds, sessions, and listings considered complete? ### Part 1 — Metric framework Propose one primary marketplace metric and a compact set of buyer, seller, liquidity, quality, and economic guardrails. #### What This Part Should Cover - A defined unit, denominator, window, and inclusion rule - Metrics connected through a causal funnel - Counter-metrics that prevent one-sided optimization ### Part 2 — Diagnosis Lay out a query and analysis sequence for a sudden change in the primary metric. #### What This Part Should Cover - Logging and definition checks before causal stories - Numerator-denominator decomposition - Cohort, mix, supply, promotion, and latency analyses ### What a Strong Answer Covers - Precise metric definitions - A falsifiable diagnostic tree - Treatment of refunds and late data ```hint Decompose before segmenting For a rate, first determine whether the numerator, denominator, or both moved. Then hold definitions fixed and decompose by stable cohorts and marketplace sides. ``` ### Follow-up Questions - How would you detect that a metric improved by starving low-converting users? - Which metric should be used for experiment power calculations?