So the advertising revenue has dropped considerably. First I would try to understand from the interviewer if it was a sudden drop or a gradual drop? Since the word considerably is used, I am going to assume it was a really sudden drop.
Now, did this happen today? The last few days? This week? If it’s only been a day, it’s probably wise to wait until tomorrow to start worrying because it could just be an off day. Let’s assume it isn’t, and it has been going on for a week or at least some amount of time where we can safely assume it’s not a phase.
I am also going to assume this isn’t the cause of our tracking software acting up or ads not displaying properly, or something like our website being down. If these were happening, I think we would know.
Let’s look at the pricing for all the ads from our ad networks. Have the prices went down across the board? Maybe not a lot of people are bidding on ads at the moment causing the price to go down, or maybe something is going on with the ad networks? I am going to assume it hasn’t. What about our competitors? Have they experienced this as well? Again, for the sake of the question, I am going to assume it’s not.
At this point, we can safely assume it’s us. Here are a few things we should find out:
– Does our website have a mobile version? Is it across both mobile and desktop?
– If it’s mobile, what about the platform (iOS, Android, Windows, and Amazon)?
– If it’s desktop, what about by browser? Could it be one of the browsers are having problem lately? Or maybe our website isn’t showing up correctly on a specific browser (maybe due to an update)?
Let’s assume by this point it’s none of the problems above, then it must be because of our users. Something must be wrong. We must be getting less traffic. It could be because our retention has gone down, so users aren’t returning. If it’s not that, maybe our users are just not as engaged as before. This could be due to a change in our web design, or maybe if we are a shopping website, for example, our prices have gone up causing users to not like, or if we are a content distribution website, we haven’t had a lot of new content or our new contents are not interesting.
This could also be because our advertisements are not interesting (this is the ad network’s responsibility) so we are not getting as many conversions as before. This is assuming we run a CPC model. Or maybe our new web design caused the number of ads per page to decrease.
If none of these are not the case, then it must be the new users. If the new user count has dropped low, it could be because our search ads are not running well, or our referrals are not working, or it could be our direct traffic. These could be because of:
– Trend shifts in marketing (our keywords aren’t trending anymore).
– A new competitor in the market. Users have gone to them.
– We haven’t kept up with marketing prices. It could be because ad prices gone up and our bids are not as competitive, or because we are spending less on marketing.
– We are not targeting the right audience for our website, or maybe we can’t anymore because these types of audience have already been targeted, so maybe we are targeting a new group that isn’t as a good fit for us.
This is the route I’d go through. Is there a particular aspect you’d like me to drill into further?