Strategy question
How would you increase ad revenue for Spotify?
- Spotify
- Strategy
- Hard
Practice this question out loud. An AI interviewer asks it, follows up like a real interviewer would, and scores your answer. Type or speak.
Start a mock interview on this question · Mock interview from a job description
What this question tests
Monetization strategy for the free and ad supported tier specifically, requiring understanding of levers unique to audio advertising.
How to approach it
- State the two core levers: ad load and ad price or relevance, which trade off against user experience.
- Propose improving targeting first, since audio ads have historically been less personalized than display or video, leaving CPM upside.
- Propose expanding ad formats beyond audio spots, such as sponsored playlists or podcast specific dynamic ad insertion.
- Consider the free to paid conversion angle, since ad load must be tuned, not maximized blindly, to avoid pushing users away instead of to Premium.
- Define success: revenue per free tier user, and the tradeoff metric, free to paid conversion rate.
What a strong answer includes
- Separates ad load from ad relevance and price as distinct levers, rather than defaulting to show more ads.
- Names podcast dynamic ad insertion, a real, specific Spotify capability, as a concrete growth area.
- Ties ad monetization to the free to paid conversion tradeoff, showing awareness of the risk to Premium growth.
Common mistakes
- Proposing simply increasing ad frequency without considering the user experience or conversion tradeoff.
- Ignoring podcasting as a distinct, already invested ad revenue lever.
Likely follow-up questions
- How would you decide the right ad load per listening hour?
- How would increasing ad revenue affect Spotify's push toward Premium subscriptions?
More strategy questions
- We launched in South Africa in 2018, but let's say we didn't. How would you lead a launch into that region?Spotify · Strategy · Hard
- Walk me through how you prioritize your product backlog.Spotify · Strategy · Easy
- What should be short and near term goals for Netflix.Spotify · Strategy · Hard
- How would you grow Spotify by 20%?Spotify · Strategy · Hard
- You’re a PM at Spotify. The company is considering adding a feature that allows artists to go live on the app. Should they invest in it?Spotify · Strategy · Hard
- Should Spotify invest in interactive podcasts?Spotify · Strategy · Hard
More questions from Spotify
Learn the skill behind it
Chapters of the AI PM course that teach what this question tests.
- Chapter 4: Discovery and strategy for AI products
- Chapter 9: Prove it paid off: outcomes, economics, and pricing
- Chapter 14: Get the job: the AI PM interview loop