Should Sojern prioritize expanding its display advertising reach or focus on improving the accuracy of its traveler intent data?

Introduction

The trade-off question at hand is whether Sojern should prioritize expanding its display advertising reach or focus on improving the accuracy of its traveler intent data. This scenario involves balancing growth in ad inventory against enhancing the quality of targeting data. I'll analyze this trade-off by examining the product ecosystem, potential impacts, key metrics, and experimental approaches to inform a strategic recommendation.

Step 1

Clarifying Questions (3 minutes)

• Context: I'm assuming Sojern is facing increased competition in the travel advertising space. Could you provide more context on the current market dynamics and our position relative to competitors?

Why it matters: Helps frame the urgency of the decision and potential market share implications. Expected answer: Sojern is a leader but facing pressure from new entrants with advanced targeting capabilities. Impact on approach: Would influence whether we prioritize short-term growth or long-term competitive advantage.

• Business Context: Based on our business model, I'm thinking display advertising is our primary revenue stream. Can you confirm our revenue split between display ads and other products?

Why it matters: Determines the potential impact of expanding ad reach on overall business performance. Expected answer: Display ads account for 70-80% of revenue. Impact on approach: A high percentage would lean towards expanding reach for immediate revenue growth.

• User Impact: I'm assuming our advertisers value both reach and targeting accuracy. Can you share any recent feedback on which they prioritize more?

Why it matters: Aligns our strategy with customer needs and preferences. Expected answer: Mixed feedback, with larger advertisers favoring reach and niche players valuing accuracy. Impact on approach: Would inform how we balance the trade-off to satisfy different customer segments.

• Technical: Considering the complexity of improving intent data accuracy, what's our current technical capability to enhance our algorithms?

Why it matters: Assesses the feasibility and potential timeline for improving data accuracy. Expected answer: We have a capable data science team but would need to invest in new machine learning infrastructure. Impact on approach: Would influence the resources and timeline required for the data accuracy improvement option.

• Resource: Given these two priorities, how does our current team capacity and budget allocation look for each area?

Why it matters: Determines the practical constraints on pursuing either option. Expected answer: Current resources are split 60/40 in favor of expanding reach. Impact on approach: Would help assess the effort required to shift focus if we choose to prioritize data accuracy.