Migration Decision Matrix
Framework for determining whether to expand geographically/demographically or stay in current market.
Framework for determining whether to expand geographically/demographically or stay in current market. Based on biological migration economics where movement cost must be less than starvation cost.
When to Use Migration Decision Matrix
Use when evaluating geographic expansion, new market entry, or demographic expansion. Apply when current market growth is slowing and you're considering whether to migrate to new territories.
How to Apply
Assess Market Saturation
Check 3 saturation signals (need 2 of 3 to confirm): growth deceleration (QoQ declining 2+ quarters AND <20% annual), CAC payback extension (2+ quarters), TAM penetration (>30% of segment)
Questions to Ask
- Is QoQ growth declining for 2+ consecutive quarters?
- Is absolute annual growth below 20%?
- Is CAC payback period extending?
- Have you reached >30% TAM penetration?
Outputs
- Saturation score (0-3 signals present)
Calculate Migration ROI
Compare migration cost vs market capture value. Formula: (New market revenue potential × probability of success - migration cost) > 0
Questions to Ask
- What is realistic revenue potential in new market?
- What is probability of success?
- What is total migration cost (direct + indirect + adaptation + philopatry)?
Outputs
- Expected ROI calculation
Evaluate Network Effects
Determine if network effects amplify with geography. More locations should create more value per user.
Questions to Ask
- Do more locations increase value for existing users?
- Is cross-border usage important?
- Are you a platform/marketplace or local service?
Outputs
- Network effects multiplier assessment
Assess Competitive Timing
Determine first-mover vs late-mover position. If competitors entered 5+ years ago with network effects, migration likely fails.
Questions to Ask
- Have competitors entered target market?
- Do they have network effects lock-in?
- What is your timing advantage/disadvantage?
Outputs
- Competitive timing assessment
Make Migrate/Stay Decision
Migrate if all 4 criteria met: saturated market, positive ROI, network effects amplify, first-mover available. Stay if any deal-breaker present.
Outputs
- MIGRATE or STAY decision with rationale