Strategy question
Imagine a product that helps farmers to get a better value for the crops they sell at the local markets. How would you go to market with this? Focus on generating incentives for both supply and demand side. Design the product.
- Strategy
- Hard
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What this question tests
Tests two sided marketplace strategy: designing incentives for both supply, farmers, and demand, local buyers, in a resource constrained market.
How to approach it
- Define both sides precisely: smallholder farmers selling at local markets, and buyers ranging from local traders to end consumers.
- Identify the core problem: farmers often lack price transparency and bargaining power against intermediaries, capturing less value.
- Propose the product: a simple mobile tool showing real time local market prices plus direct buyer connections, usable on basic phones.
- Design supply side incentives: better realized prices and reduced dependence on middlemen build farmer trust and adoption.
- Design demand side incentives: buyers get more reliable supply and quality information, worth a small transaction fee.
- Define success: average price uplift farmers realize and repeat usage rate among both sides.
What a strong answer includes
- Grounds the core problem in a specific mechanism, farmers accepting low prices from intermediaries due to lack of price transparency at the point of sale.
- Designs for low tech access, SMS or basic app price alerts, since smallholder farmers may not have smartphones or reliable data.
- Proposes a concrete incentive loop, farmers get a stated percentage better price by connecting directly to buyers, while buyers get quality assurance and reliable supply.
- Sets a measurable goal, for example an illustrative percentage increase in average farmer revenue per transaction within the first year.
Common mistakes
- Assuming smartphone and data access that smallholder farmers in many regions do not reliably have.
- Designing incentives for only one side of the marketplace and ignoring what makes buyers actually adopt it.
Likely follow-up questions
- How would you build trust with farmers who are used to trusting existing middlemen?
- How would this work in areas with limited smartphone penetration?
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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