Design Experiment to Evaluate New Video-Ad Effectiveness

Q: Design Experiment to Evaluate New Video-Ad Effectiveness

This question evaluates competency in experimental design and causal inference, including randomized assignment, metric definition, power and sample-size reasoning, interference management in auctioned ad ecosystems, and interpretation of sequential tests and rollout criteria.

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Question

Experiment Design: Measuring the Impact of a New Video‑Ad Format

Context

You are designing an experiment for a large consumer app that runs an ad auction. A new video‑ad format (UI/creative/interaction changes) is being considered. The goal is to estimate its causal impact on advertiser effectiveness and revenue while protecting user experience, accounting for potential interference in the ad marketplace.

Task

Design an experiment to evaluate the new format. Specify:

Unit of randomization (and why), including options (A/B vs multivariate, user vs impression vs geo) and how to manage auction/interference.
Primary and secondary metrics (with definitions and guardrails).
Sample size and power considerations (including variance reduction, clustering, and sequential testing).
Success criteria and a rollout plan.
If the primary metric shows no statistically significant improvement, list follow‑up analyses and alternative actions.

Design Experiment to Evaluate New Video-Ad Effectiveness

Experiment Design: Measuring the Impact of a New Video‑Ad Format

Context

Task

Solution

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