Should Openpay prioritize expanding its merchant network or focus on improving the user experience of its existing payment plans?

Introduction

The trade-off question at hand is whether Openpay should prioritize expanding its merchant network or focus on improving the user experience of its existing payment plans. This scenario involves balancing growth through network expansion against enhancing the core product experience. I'll analyze this trade-off by examining the current state of Openpay's product, evaluating potential impacts, and proposing a data-driven approach to make an informed decision.

Step 1

Clarifying Questions (3 minutes)

• Context: I'm thinking Openpay might be facing increased competition in the BNPL space. Could you provide more context on our market position and recent growth trends?

Why it matters: Helps understand the urgency of expansion vs. improvement Expected answer: Moderate growth, increasing competition Impact on approach: Would influence the balance between aggressive expansion and product refinement

• Business Context: Based on our revenue model, I assume we earn from merchant fees and late payment charges. Is this correct, and are there any other significant revenue streams?

Why it matters: Clarifies the financial implications of focusing on merchants vs. users Expected answer: Confirmation of revenue streams, possibly with percentages Impact on approach: Would help prioritize which stakeholder group to focus on

• User Impact: I'm curious about our user retention rates. Do we have data on user churn and the primary reasons for it?

Why it matters: Indicates whether UX improvements could significantly impact retention Expected answer: Moderate churn, UX issues as a contributing factor Impact on approach: High churn would lean towards prioritizing UX improvements

• Technical: Regarding our current platform, how scalable is it for onboarding new merchants? Are there any technical limitations we should be aware of?

Why it matters: Assesses the feasibility of rapid merchant expansion Expected answer: Some scalability issues, but manageable with investment Impact on approach: Technical constraints would influence the timeline for expansion

• Resource: Can you give me an overview of our current team structure and any planned hiring, particularly in product development and merchant acquisition?

Why it matters: Determines our capacity to pursue both strategies simultaneously Expected answer: Limited resources, need to prioritize Impact on approach: Resource constraints would necessitate a more focused strategy