How can Carousell balance increasing ad inventory with maintaining user experience?

Introduction

Balancing increased ad inventory with maintaining user experience is a critical challenge for Carousell. This trade-off involves optimizing revenue generation through ads while ensuring users remain engaged and satisfied with the platform. I'll analyze this situation using a structured approach, considering various stakeholders, metrics, and potential outcomes.

Step 1

Clarifying Questions (3 minutes)

• Business Context: I'm thinking Carousell's primary revenue stream is advertising. Could you confirm if this is correct and share the percentage of total revenue it represents?

Why it matters: Helps prioritize the importance of increasing ad inventory. Expected answer: Yes, advertising is the main revenue source, accounting for 70-80% of total revenue. Impact on approach: High percentage would justify more aggressive ad inventory increase.

• User Impact: Based on user behavior, I assume there's a threshold where increased ads significantly impact user engagement. Do we have data on current ad load and user satisfaction metrics?

Why it matters: Identifies the current state and potential room for growth. Expected answer: Current ad load is X%, with Y% user satisfaction. Impact on approach: Low satisfaction might necessitate a more cautious approach.

• Technical Feasibility: I'm thinking about the technical aspects of increasing ad inventory. Are there any current limitations in our ad serving infrastructure?

Why it matters: Determines if technical constraints influence our strategy. Expected answer: Current system can handle 20% increase without major upgrades. Impact on approach: Technical limitations might phase our implementation.

• Resource Allocation: Considering this trade-off, I'm curious about our current team structure. Do we have dedicated teams for both ad operations and user experience?

Why it matters: Assesses our ability to execute and monitor changes effectively. Expected answer: Separate teams exist but collaboration needs improvement. Impact on approach: Might need to establish cross-functional workstreams.

• Timeline Pressure: Given the nature of this trade-off, I'm wondering about any immediate revenue targets or upcoming product launches that might influence our timeline.

Why it matters: Helps balance short-term needs with long-term user experience. Expected answer: Q4 revenue targets are aggressive, new features launching in 3 months. Impact on approach: Might need to consider staged implementation to meet short-term goals.