Dropbox · Go-to-market · Entry · 45 to 60 minutes

Choose Dropbox's Next Acquisition Bet

Dropbox is a cloud storage service that lets people save, sync, and share files across devices. Answer this product management case and get it graded line by line against a weighted rubric.

Growth strategy
Prioritization
Unit economics
Experiment design
Structured communication

The situation

In 2008, Dropbox has a product people love once they try it, a simple way to keep files synced across computers. Drew Houston asks you, a PM helping with growth, to recommend Dropbox's next acquisition move. The problem is not that the product is broken. Early users see clear value, but new user growth is too slow, and the current approach is not economically sustainable. Paid search and other ads are expensive, and the cost to acquire free users is already higher than the likely value many of them generate. Traditional marketing is also a weak fit because people are trusting Dropbox with important personal and work files, so a generic ad may not be enough to persuade them to sign up. Leadership wants a growth plan that can scale without a large marketing budget and that can earn user trust. Your task is to decide which acquisition approach Dropbox should prioritize next, explain why it is the best choice now, and show how you would test whether it works.

What to produce

Write a 1 to 2 page growth strategy memo.

Your answer must

State the core acquisition diagnosis in 2 to 3 bullets, including why the current paid approach is unattractive.
Compare at least 3 plausible acquisition approaches Dropbox could pursue next, then select 1 as the primary recommendation.
Explain why your choice fits Dropbox's user behavior, trust dynamics, and freemium business model.
Outline a first test plan for the chosen approach, including target audience, key steps, and what the team would build or do first.
Define 3 success metrics and 1 guardrail metric, and explain what results would make you scale, revise, or stop the approach.

Constraints

Do not rely on a large ongoing ad budget, current paid acquisition is already too expensive.
Do not assume a major rebuild of the core file sync product.
Your recommendation must preserve user trust and keep the product simple.
The plan should be testable quickly, with clear learning value even if it does not scale immediately.

Format

Use short headings, and include a small comparison table for the acquisition options.

How Dropbox actually played it

Describes Dropbox's two-sided referral program, why it matched user motivation, and how it cut acquisition cost compared with paid ads.

Reward both sides of a referral
Make sharing part of the product flow
Compare referral cost with paid acquisition

Built from How Dropbox Achieved Explosive Growth Using Referrals by Sreerag Panat.