Investing in Growth

You can’t cut your way to growth.

But, you can cut your way to lower acquisition costs and stronger economic performance. Just identify the worst marginal use of your marketing dollars and cut it. Then just rinse and repeat.

This will open up some available capital that you can use to then invest in growth, making this a two-step process.

The interesting thing is that you can almost always tell in advance what impact the cuts you make will have on your economic performance, since you’re eliminating activity for on which you have real, historical data to evaluate.

It’s a lot harder to tell what future investments are going to drive meaningful growth, because you’re adding new activity for which you’re forced to extrapolate performance.

This is why growth is hard and that the best strategies involve testing and experimentation built on a strong foundation of tracking, measuring and understanding performance.

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