Reddit · Strategy · Mid · 45 to 60 minutes

Increase Reddit revenue per active user

Reddit is an online platform where people gather in topic-based communities to read, post, and discuss content. Answer this product management case and get it graded line by line against a weighted rubric.

product strategy
monetization thinking
tradeoff analysis
user empathy
metrics design

The situation

You are a PM on Reddit's monetization team. Your director asks for a near-term strategy for the U.S. market after leadership raises a concern: Reddit earns mostly from ads, with a smaller premium business, but the company cannot push revenue in ways that make conversations feel commercial or low trust. The request is focused on active contributors, people who post or comment at least weekly, because leadership believes more value can be created from this group than from casual readers. You have a 3 to 6 month window to recommend experiments that could raise revenue per active user, not just total revenue. Competition is stable and there are no major recent product changes to lean on. The hard part is that the same users who create the most value for Reddit are also the most sensitive to anything that feels spammy, extractive, or unfair to communities and moderators. Your job is to identify where monetization can fit naturally into the Reddit experience, decide which path to test first, and show how you will protect the authentic, discussion-driven product people come for.

What to produce

Write a 1 to 2 page strategy memo.

Your answer must

Frame the problem clearly, including the target user, business goal, and why active contributors are the focus.
Map Reddit's current macro funnel to revenue and identify 2 to 3 monetization moments or drop-off points worth attacking first.
Propose 3 to 5 monetization directions, including at least one ad-related option and at least one non-ad option, and explain how each fits or conflicts with Reddit's product experience.
Prioritize one recommendation using explicit tradeoffs such as impact, effort, risk, and fit with Reddit's culture.
Define success metrics, including a primary revenue metric and at least one guardrail metric that protects authentic discussion, plus a first experiment plan for the next 3 to 6 months.

Constraints

Keep the scope to U.S. active contributors and a 3 to 6 month testing horizon.
Do not depend on major policy changes, acquisitions, or large new partnerships.
Protect authentic discussion and avoid recommendations that would materially increase low quality posts, comment clutter, or trust issues.
If you use any figures, label them clearly as Assume.

Format

Use sections for problem framing, funnel diagnosis, options, recommendation, metrics, and experiment plan.

How Reddit actually played it

A worked answer on raising Reddit revenue without damaging the authentic discussion experience users value. It weighs ad and non-ad options.

Revenue ideas must be judged against the core experience
Segment where monetization is least intrusive
Define a guardrail metric alongside revenue

Built from Product Growth Case: Reddit revenue by Sreerag Panat.