You are advising a ride-hailing product team on where to place next quarter's growth budget. The team can either buy more demand through acquisition channels or improve activation in the first trip funnel, and leadership wants a clear recommendation. Recent data shows acquisition is bringing in more new users, but a large share never complete a first ride. The question is whether the bigger return comes from adding more users at the top of the funnel or fixing the drop-off after signup.
How would you decide whether to invest in acquisition or activation for the next quarter?