EMPERIO Marketing Lab
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Set an in-app ad cap in Hyderabad

Hyderabad, Telangana · Fictional practice case

The decision

A fictional learning app randomly assigns 5,000 users per arm. A higher ad cap raises weekly ad contribution by ₹4,500 but reduces paid upgrades from 135 to 120. Each upgrade contributes ₹400 over the measurement horizon.

Which ad cap maximizes combined contribution?

Worked solution

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Case at a glance
₹4,500 more ad contribution. ₹6,000 less upgrade contribution. ₹1,500 decline overall
  1. Use assigned users and a consistent horizon. The upgrade difference is 15 accounts, or 0.3 percentage points.
  2. Lost upgrade contribution is 15 × ₹400 = ₹6,000. Net impact is ₹4,500 − ₹6,000 = −₹1,500 before longer-term retention effects.
  3. Keep the original cap pending a longer test. Track day-seven retention, complaints and revenue by placement and device.

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