Press Release

Monday, May 31, 1999 < Prev Next >

Visio Tests a "Made-to-Order" Sales Model

Like many publishers, Visio Corp. has seen its core product become relentlessly more complex and feature-rich. Early versions of Visio's drawing and diagramming program shipped with a few libraries of graphical "shapes"; now, the Visio libraries include upwards of 15,000 images — everything from crime scene objects and office furniture to generic flow charts, time lines, and maps.

Since few users need all these libraries, Visio has tried to create task- specific versions of the product. "But retailers don't want us to put 15 different SKUs into the channel," says marketing director Mike Molendijk. "So almost everything still ends up in one big product."

Now Molendijk says the company has found a solution: For the past two months, a skunkworks team has been testing a Web-based "Chinese menu" sales model called eVisio. Customers at the eVisio site can assemble their own customized drawing applications by buying the core Visio engine and then adding sets of libraries. The core engine with just two libraries sells for $225, and there are additional price points and pre-configured solutions that range up to a $640 "eVisio Everything" package that is the software equivalent of an all-you-can-eat buffet.

In total, says Molendijk, the eVisio site offers more than 250 unique product configurations. "The only limiting factor was what our ERP program could handle," he quips. All customers get the same CD-ROM disk (shipped overnight by UPS), plus a downloadable unlocking key that installs only the modules that the customer has paid for.

What do customers think about this "made-to-order" approach? Component-based sales models haven't been especially successful in the past, but Molendijk says eVisio's first two months look pretty promising. "We're still taking baby steps, but we've had 16,000 unique visitors to the site and sales are growing steadily."

Molendijk also says the test has uncovered a few surprises:

  • Polarized buying behavior: So far, the average transaction on the eVisio site is about $300, says Molendijk, but the distribution of sales "looks like an inverted bell curve — people either buy two libraries or they buy everything." Knowing which configurations are most popular will help with future pricing decisions, he adds. "Setting prices with no data was a harrowing process."
  • Customer enthusiasm: "People are psyched about this idea," Molendijk notes. "And they seem to be passionate about little details, like seeing their name printed on the CD." This enthusiasm is especially surprising, he adds, because customers are getting a version of the product that will soon be replaced by a major upgrade. "We'd certainly get a lot more attention if we were also talking about a new product."
  • Customer suggestions: Molendijk says the "made-to-order" model seems to encourage a lot more feedback from customers about the product. "More than a third of the e-mails we get are requests for additional modules. People are even telling us what they'd be willing to pay for an individual shape object."
  • Licensing issues: Currently, the eVisio site only supports individual credit card sales. But the site has already attracted interest from corporate customers and resellers, says Molendijk. "We have to figure out a new kind of license for these customers, and that's not easy."

Michael Molendijk, eVisio marketing director, Visio Corp., 2211 Elliott Ave., Seattle, Wash. 98121; 206/956-6629. E-mail: michaelm@visio.com.

Source page: http://www.thefreelibrary.com/Visio+tests+a+%22made-to-order%22+sales+model.-a054884903