Should OPay prioritize expanding its merchant network or improving existing user experience?

Introduction

The trade-off between expanding OPay's merchant network and improving the existing user experience is a critical decision that will shape our product strategy and market position. This scenario touches on the core tension between growth and user satisfaction, which is fundamental to many fintech platforms. I'll approach this analysis by examining the current state of OPay, evaluating the potential impacts of each option, and providing a data-driven recommendation for our path forward.

Step 1

Clarifying Questions (3 minutes)

• Context: I'm thinking about OPay's current market position. Could you share our current market share and growth rate compared to competitors?

Why it matters: Helps determine if expansion or retention should be prioritized. Expected answer: Moderate market share with high growth rate. Impact on approach: Would lean towards expansion if growth is strong.

• Business Context: Based on our revenue model, I assume transaction fees are a significant portion. What percentage of our revenue comes from merchant transactions versus other services?

Why it matters: Indicates the potential impact of expanding the merchant network. Expected answer: 60-70% from merchant transactions. Impact on approach: Higher percentage would justify network expansion.

• User Impact: Considering user segments, are we seeing any particular pain points or drop-off rates in specific user groups?

Why it matters: Identifies areas where UX improvements could have the most impact. Expected answer: Higher churn in new users during onboarding. Impact on approach: Might prioritize UX improvements for new user retention.

• Technical: Regarding our current infrastructure, how scalable is our platform for onboarding new merchants?

Why it matters: Determines the feasibility and cost of rapid merchant expansion. Expected answer: Moderately scalable with some limitations. Impact on approach: Would influence the timeline and resources needed for expansion.

• Resource: What's our current team capacity for UX improvements versus merchant onboarding?

Why it matters: Helps understand resource allocation and potential trade-offs. Expected answer: Balanced team with slight lean towards merchant onboarding. Impact on approach: Would affect the speed of implementation for either option.