Should Innovid prioritize expanding its interactive ad formats to increase engagement or focus on improving measurement capabilities for better ROI tracking?

Introduction

The trade-off between expanding interactive ad formats and improving measurement capabilities is a critical decision for Innovid's product strategy. This scenario involves balancing user engagement with ROI tracking, two key pillars of successful digital advertising. I'll analyze this trade-off by examining the product ecosystem, potential impacts, and experimental approaches to inform a data-driven recommendation.

Step 1

Clarifying Questions (3 minutes)

• Business Context: I'm thinking Innovid's revenue model likely relies on both ad engagement and measurement capabilities. Could you clarify how these two aspects currently contribute to our revenue streams?

Why it matters: Helps prioritize the trade-off based on financial impact Expected answer: Both contribute significantly, with a slight edge to measurement Impact on approach: Would influence resource allocation between the two options

• User Impact: Based on our current user base, I'm assuming we have different types of advertisers with varying needs. Can you provide insights into the distribution of advertisers who prioritize engagement versus those who focus more on ROI tracking?

Why it matters: Helps tailor the solution to meet the needs of our most valuable user segments Expected answer: Mix of both, with larger advertisers leaning towards ROI tracking Impact on approach: Would inform feature prioritization and potential segmentation of solutions

• Technical Feasibility: Considering our current tech stack, I'm thinking expanding interactive ad formats might require significant frontend development. How does our current architecture support this kind of expansion?

Why it matters: Determines the effort and timeline required for implementation Expected answer: Modular architecture that can support expansion with moderate effort Impact on approach: Would influence the scope and phasing of the interactive ad format expansion

• Resource Allocation: Given the potential scope of both options, I'm curious about our current team structure. How are our engineering and data science teams currently allocated between ad format development and measurement capabilities?

Why it matters: Helps understand the feasibility of pursuing both options simultaneously Expected answer: Roughly equal split, with some flexibility for reallocation Impact on approach: Would inform the feasibility of a hybrid approach or need for sequential implementation

• Timeline and Market Pressure: Considering the competitive landscape, I'm wondering about the urgency of this decision. Are there any upcoming market events or competitor moves that are driving the timeline for this decision?

Why it matters: Helps prioritize short-term gains vs. long-term strategy Expected answer: Increasing pressure from competitors in measurement capabilities Impact on approach: Might lean towards prioritizing measurement improvements if market pressure is high