Discuss the tradeoffs between showing the people you may know" widget versus ads in the newsfeed. How would you decide which one to show to a given user?"

Introduction

The trade-off between showing the "people you may know" widget versus ads in the newsfeed presents a classic product dilemma. We're essentially weighing user engagement and network growth against direct monetization. This decision impacts user experience, revenue, and long-term platform health. I'll analyze this trade-off by examining user behavior, business implications, and potential experiments to inform our strategy.

Step 1

Clarifying Questions (3 minutes)

• What's our current revenue model, and how significant is ad revenue?

• Why it matters: Understanding our revenue structure helps prioritize monetization vs. growth.
• Hypothetical answer: Ad revenue accounts for 70% of our total revenue.
• Impact: If true, we'd need to be cautious about reducing ad exposure.

• What's our current user growth rate, and how does it compare to targets?

• Why it matters: This helps us gauge the importance of the "people you may know" feature for growth.
• Hypothetical answer: Growth has slowed to 5% year-over-year, below our 10% target.
• Impact: If true, we might lean towards prioritizing the "people you may know" widget to boost growth.

• What's the current engagement rate with the "people you may know" widget?

• Why it matters: This indicates the widget's effectiveness in driving connections.
• Hypothetical answer: 20% of users who see the widget make a new connection within a week.
• Impact: A high engagement rate would support keeping or expanding the widget's presence.

• What's our current ad load in the newsfeed, and how does it compare to industry standards?

• Why it matters: This helps us understand if we're at risk of ad fatigue.
• Hypothetical answer: Our ad load is 1 ad per 5 organic posts, slightly below the industry average.
• Impact: If we're below average, there might be room to increase ad load without significantly impacting user experience.

• Are there any upcoming strategic initiatives or partnerships that could influence this decision?

• Why it matters: Long-term plans could affect our prioritization of growth vs. immediate revenue.
• Hypothetical answer: We're planning to launch a new business networking feature in Q3.
• Impact: This might increase the importance of growing our user network, favoring the "people you may know" widget.