Day 15 - Product Strategy Question 3
Practice product strategy questions with us...
Hello learners!
Welcome to the 15th day of the series 30 Days of PM Interview by Crework! Yesterday, we discussed the second exercise question for product strategy. Today, we will practice another one.
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Building Product Strategy!
Your practice question for today is:
Imagine you're a PM for Netflix. Should Netflix launch a podcasting app? (Asked at Meta)
Now, before we move on to “how should we approach it” part, I want you to try it. Come on, pause here for a while, bring a notebook and pen and try this question.
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Okay, now let’s talk about how we can approach this.
Step 1: Ask Clarifying Questions
Why is Netflix considering launching a podcasting app?
What is the output Netflix is expecting once it launches a podcast application?
Is it already decided that we would need a separate app for podcasts?
Are we talking about only video podcast or audio podcasts too?
Are we considering to do this for a certain geography or demographic or for everyone?
For this problem, I will assume that Netflix wants to gain more subscribers and eventually increase its revenue, hence is looking into newer markets. They haven’t finalized if they want a new app yet, and is considering this only for USA right now.
Step 2: Approaching the problem
To answer this question, we will take this approach:
Understanding the podcast market
Does it align with Netflix’s mission?
What results can Netflix achieve with this?
Would these results align with Netflix’s goals?
Understanding the podcast market
The podcasting market has seen significant growth in recent years, with a wide range of content genres and audiences, specially in US where it is becoming very popular.
Major players like Spotify, Apple Podcasts, and Google Podcasts dominate the market, but there is still room for new entrants.
Podcasting typically operates on ad-based or subscription-based models, offering both free and premium content.
The podcast listening audience is pretty diverse but the majority of them are in the age group of 12-34.
Alignment with Netflix’s goal and mission
Netflix’s mission is to entertain the world. Podcasts today are seen as a way of both entertainment and education. It is rather becoming a pastime for people just like watching movies and web series.
Netflix users are also relatively young with majority of them in the age group 18-44. So, there’s a bit of overlap in the target audience.
Netflix’s goal is to gain new users. So, their interest is in users who listen to podcast but are not subscribers of Netflix yet.
Results Netflix can achieve
Diversification of Content: Offering podcasts could attract users who are interested in audio content and complement Netflix's existing video content.
Utilization of the current ecosystem: Netflix doesn’t need to create a new product or app for integrating podcasts into the platform. They can add it just like other content in the existing platform.
Synergy with Existing Content: Netflix could leverage its relationships with content creators to produce exclusive podcasts tied to popular shows or movies.
Monetization Opportunities: Podcasting platforms offer various monetization avenues, including ads, sponsorships, and subscription models, which could contribute to Netflix's revenue.
Alignment of results and goals
Adding podcast to Netflix can be a good opportunity to attract new users by signing exclusive contract with some well known content creators. Producing podcasts would cost less than producing a new movie or a series and can have a higher frequency, hence cost efficient.
Also, podcasts might make the users revisit Netflix for new content and episodes regularly aiding retention.
Challenges and Risks
Competition: The podcasting market is already crowded with established players, making it challenging for new entrants to gain market share.
User Acquisition: Attracting and retaining podcast listeners in a competitive market may require substantial marketing efforts and resources.
Based on the analysis, my recommendation would be for Netflix to cautiously explore the possibility of launching podcasts on its existing platforms instead of a new app. They can start a trial by adding a few popular podcasts on the platform for a season and see how that affects the metrics. If executed strategically and in alignment with Netflix's mission and objectives, podcasts could offer valuable opportunities for growth and expansion.
This was an example of how you can approach a product strategy question asked in a PM interview. There can be multiple ways of approaching the same problem, and there is no “right” answer. The interviewer wants to assess your ability to think and come up with a solution. The real answer is the process you use to come up with your solution.
I would love to see the solution you came up with. Please share it with us on twitter or reply to this mail.
Day 15 - Completed ✅
Congratulations on completing the 15th lesson of the series 30 Day of PM Interview. 🥳 Now, you know what to do. Share your learnings with the world and be accountable.
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