Jim hoped to discount and social media would increase unit sales and revenue. He believed it would strengthen his case for investment and loans. Adding more products for little cost might expand sales to existing customers and attract new ones. More spending would shorten the future of the company if things didn’t improve. He didn’t see another choice.
Jim observed that unit sales had spiked after the discount started. Revenue rose as did his burn rate. He targeted a 25% increase in revenue from the two new product extensions.
Both new product versions were priced higher than the original. The first product contributed 15% to the monthly run rate, but the 2nd product was limping along, adding just 3%. Just killing the second product would be money down the drain. A lowered price only decreased losses.
Jim wasn’t ready to give up on the weaker product. Maybe it just needed more exposure to the marketplace. He decided to advertise it more – costing money. He decided to give it a few more months.
Jim’s Decision about the weaker product – Wait Choice removed: Drop the product
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