expert
Expert with best answer
D is correct. Why is C not the best answer? It directly mentions the outcome ("stronger growth"); A, B, D don't.
2 answers
Hi,
Answer D is the right one. You can cross-sell to the existing customers, and thus:
- You will have no extra customer acquisition costs, and existing CAC will be spread over more revenues
- Your lifetime value of the customer will increase since you can sell more to the same customers
Best
(edited)
Thanks for the answer, Vlad. Shouldn't the best argument in favor of pursuing the new opportunity be the direct answer of "it will definitely lead to stronger growth in the future" (outcome, C) rather than "the conditions for stronger growth are given" (opportunity, implied in D)? — on Jan 28, 2020 (edited)
D is the correct answer because
1. It implies that you already have the customer base in your portfolio and assuming they trust you it is a strong captive market that others don't have access to (competitive advantage)
2. It explains the reasoning for why it is a good reason to expand into sales
C is not a good reasons because
1. It does not tell you why diversification will lead to stronger growth (diversification in and of itself is not an argument for growth. If that were the case all companies would have multiple areas of focus and not just one)
2. It does not ecplain where the stronger growth will come from (who will the new customers be? How will we attract them? etc.)
Best,
Udayan
(edited)
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