First, we wanted you to know that we just completed our most successful year ever. In 2009, we increased our total customer base by nearly 30%. When the year began, economic prospects were dismal as the global economy fell into the deepest recession since the Great Depression. Which makes the first statement all the more remarkable.
We based our marketing strategy in 2009 on the belief that businesses and consumers had become extremely frugal, just as we did. Those that wanted to create value in the form of products and ideas were simply unable to do so; it was cost prohibitive to many individuals and businesses to invest in the tools they required. Sure there are those that can afford it - but there are many, many more that couldn't. We felt that there was a tremendous opportunity, both for the consumers and ourselves, if we were willing to offer our software at truly extraordinary prices. Below $100.From day one we saw a remarkable demand, indicating to us that many people want and need the type of software we sell but could not afford our previous prices, much less the prices of our competitors. We believe this demand isn't going away, and that a huge number of people have and will continue to benefit from access to 3D CAD software. So, we've decided to make these sweeping price changes.
At Alibre, our mission has always been to offer the best value in the CAD industry, and to enable as many people as possible to use this technology. The primary thing standing in the way has been price. We are removing that barrier.
We plan a very aggressive, but simple and direct appeal to the 3D CAD market. We will combine Alibre Design Standard with Alibre Translate and sell it for only $97. This is a product that everyone who works with CAD should have, that will pay for itself after a single use.In addition, we're decreasing prices for Alibre Design Professional and Expert, as well as all software maintenance prices. This isn't a promotion or a gimmick - all Alibre Design software and maintenance prices as of February 1st will be reduced to:
Finally, all new and current customers (on maintenance) will now receive Alibre Translate without additional charge. This has already happened, as many of you may have noticed. Just restart Alibre Design.We are very optimistic about the future and excited about these changes. We hope you will join us in celebrating them by taking the opportunity to increase the utility you receive from Alibre Design and to communicate its outstanding value to your friends and associates.
Recently, Deelip Menezes, blogged about Alibre Design Vs. SolidWorks in response to a blog posting by “Gabi”. He also wrote a blog post showing how to create a Christmas wreath with SolidWorks that he used to substantiate his comparison.
We couldn’t resist the temptation to reproduce his Christmas Wreath model in Alibre Design. I forwarded his blog link to our marketing and engineering departments and within minutes had several versions of an Alibre modeled Christmas Wreath. The Alibre model (enhanced with Hypershot, which is included with Alibre Design Professional and Expert) is on the top and the SolidWorks model is below.
Frankly, I like ours better, but admittedly I am biased toward Alibre and undoubtedly Deelip or another SolidWorks user could create a better-looking wreath than either of these.
We must be getting under SolidWorks skin though, given the defensiveness of some of the blog comments. They want to turn the discussion into a feature war as a tactic to avoid the truth, which is that SolidWorks is overpriced and bloated with unnecessary features that most people don’t need, can’t master, and won’t use. They belittle our marketing, but their complaints just prove its effectiveness. People are talking about Alibre; we are generating interest and controversy.
They also complain about our pricing, but fail to see that our price promotions are deliberate and effective. We are systematically testing different price points to determine price elasticity. This is a proven technique. If you were to keep track of every offer we ever made, they may appear to be rapid and random. However, it looks completely different to the 99% of new leads we get every month. Our pricing promos are intended for these new prospects.
We have 10’s of thousands of customers that swear by Alibre Design for their professional and personal design and manufacturing projects. Our pricing promotions won us thousands of additional customers. They tell us that Alibre Design is powerful, but easy to use and easy to learn. It does what they need and often pays for itself in the first project completed.
The economy is just starting to come out of the worst recession since the Great Depression, but millions of workers are still unemployed or underemployed. Everyone else is still worried about their jobs and the economy. Frugality has replaced luxury as the mantra of purchasers from corporate managers to soccer dads.
Alibre has had a great year, thanks to our customers and our employees. We added a record number of new customers and set new records in sales and profitability. Our financial outlook has never been better.
So what better Christmas present could Alibre give engineers and designers than a powerful, affordable 3D CAD program that they can use to turn their product dreams into reality, and perhaps grow a business, start a new one, or just build something cool that they are proud of.
Merry Christmas from Alibre!
In August and September, Alibre demonstrated that the 3D CAD market is bloated, over priced and out of touch with customers. With our affordable $99 Challenge Offer, we sold thousands of seats, including hundreds of new multi-seat customers and booked record revenue, cash flow, and profits.
Now we are raising the bar, especially against the large, expensive, CAD vendors. We want customers to realize just how much money they can save by using Alibre Design, especially if they have multiple CAD users in their organizations. The process is very simple. Just get a quote - from any vendor selling comparable software and bring that quote to Alibre.
Everyone knows that prices for 3D CAD software are ridiculously expensive, especially in this economy, during the greatest recession since the Great Depression. Vendors such as Dassault Systemes, Autodesk, Siemens, and Parametric Technologies charge $5,000, $10,000, and upwards of $20,000 per seat for products such as Solidworks, Inventor, Solid Edge, Pro/E, NX, and CATIA.
For example, a quote for SolidWorks Standard at www.solidworks.com runs $3,995 for one license and $1,295/year for a maintenance subscription for a total of $5,290. This means a customer will pay only $529 for Alibre Design Standard with maintenance, saving $4,761 over Solidworks. And the savings really add up with multi-seat purchases; 5 seats of Alibre Design cost $2,645 versus $26,450 for Solidworks, a savings of $23,805!
Competitive quotes tailored for individual companies could be even lower than list price due to promotions and other offers. Alibre's Price Guarantee applies to these competing promotional offers as well.
We are encouraging people to do a thorough evaluation of our software versus the competition. Often they will find they can get their jobs done more efficiently using Alibre Design and at a fraction of the price of the alternatives. Now we are also guaranteeing, that no matter what price the quote, no matter how low the other guys go, we will beat them by a factor of 10. It doesn't matter if the quote is for SolidWorks, Inventor, Solid Edge, Pro Engineer, etc. - any quote for any software product that offers comparable functionality will be beaten by a factor of 10.
You might wonder how Alibre can sell professional 3D CAD software at affordable prices. It’s simple, we have a lean, web-oriented, sales, marketing, and distribution structure with all employees located at a central headquarters near Dallas, TX that is complimented by third party resellers in major geography’s. Since we don’t require a direct sales force, geographically distributed premium office space, travel, or client entertainment expenses like our competitors, we can pass on thousands of dollars in savings to customers and still make a reasonable profit.
Before you spend thousands or tens of thousands of dollars for CAD software you should ask yourself, “Is my money going to pay for support and future software improvements, or just paying the costs of unnecessary overhead?”
It's going to happen, the only question is when. The CAD software industry's monopolistic, anti-competitive practice of offering bloated, overpriced 3D CAD packages will come to an end.
It’s been an interesting couple of days for those that like to watch high-priced CAD software companies. Dassault Systemes surprised everyone with an eleventh-hour announcement happily proclaiming the demise of their decades long exclusive PLM sales agreement with IBM. Only a day later, in an unlikely coincident, came the release of Dassault’s earnings report, which revealed an annual software revenue decline of 12%, based in large part on a 37% fall in new licenses sales, including a 34% decline in Enovia. Enovia plus CATIA are the two primary products sold by IBM for Dassault.
After acknowledging a "challenging" third quarter and cutting its full-year sales guidance, Dassault executives went on to voice optimism for 2010 and call the separation from IBM “a boon to customers.”
Oddly, executives at Siemens and PTC joined the cheerleading chorus by pronouncing the IBM deal a “leveling of the playing field” that would benefit the industry. Somehow, losing IBM as a channel partner is good news for both Dassault and its competitors.
Apparently, skeptics of the “great news” have all been transported to a parallel universe where independent critical analysis still exists, leaving only those analysts and writers behind that readily accept executive pronouncements at face value. I searched in vain for anyone who put these two announcements together. Surely, there must be some linkage between the rushed, last minute IBM announcement and the 37% decline in new license sales.
Dassault is paying IBM $600M to acquire between $450-$600M of annual revenue and approximately 700 IBM employees. Significantly, this marks the first time that Dassault Systems will take direct responsibility for selling any of their own software products. With this comes the responsibility to manage a large direct sales force. The opportunities for failure are huge, but completely unspoken by Dassault and unasked by analysts and the media. Rather than a win-win arrangement we have:
Dassault and 700 individual IBM employees are going to have to decide whether they like each other or not. Given the unit’s recent sales performance and Dassault’s emphasis on cost reduction, many of these positions could be on the block. Severance costs could be considerable. Plus, how many dyed in the wool blue suits will eagerly leave their careers at IBM to join a French software developer?
Massive chaos in the ranks seems inevitable, and a culture clash of epic proportions certain, as IBM’s “take no prisoners” sales team moves into the headquarters of technology driven Dassault. Don’t forget, these IBM guys are the same ones that routinely go straight to the top to get anyone standing in their way fired. Direct sales teams can easily establish cultural dominance in large publicly held companies, as excellent sales execution is required to meet investor expectations.
One of Dassault’s strengths has been its ability to acquire and successfully manage the growth of companies such as Solidworks and Enovia. The key to their success has been the independent management of sales channels, allowing Dassault to remain neutral and avoid product / channel conflict. Companies such as PTC, Autodesk, and Siemens quickly absorb the sales operations of their acquisitions, resulting in sub-optimization of combinations.
How long before clashes between product-aligned organizations, the new direct selling PLM headquarters versus the Solidworks VAR channel, develop over which products should be sold and who should get credit for them? Will Solidworks become like Solid Edge at Siemens, an increasingly marginalized stepchild of a foreign parent with better loved and better looking offspring?
Alibre’s very popular $99 Challenge offer for Alibre Design Standard V11.2 ended on September 29th, the same day we began shipping Alibre Design Version 12.
The results exceeded our expectations. We are happy to report that we had record sales and profits in August and September. We added thousands of new customers worldwide, including hundreds of multi-seat business customers. Approximately 40% of new customers were business and 60% individual designers. Unit sales increased by an order of magnitude and lead volume more than doubled. We also received excellent blog and media coverage, with more than a dozen articles including several blogs that discussed the offer more than once. German, Japanese, UK, Australian and other Alibre VAR’s reported similar results.
CAD users apparently haven’t gotten enough though. Every day since September 29th folks are telling us why “they” still deserve to get the $99 offer. We have heard everything from “I didn’t realize it was the 29th already” to the equivalent of “the dog ate my sticky note.”
So to reward our customers, and because we don’t like to turn down business, we are going to authorize existing customers to offer the Alibre Design V11.2 for the $99 price to their friends and associates. Effective immediately, existing customers can authorize up to 10 of their friends or associates to buy V11.2 for only $99 each. Existing customers must use the Alibre “Refer-a-Friend” process to authorize the new referrals. In other words, to qualify for the $99 price, an existing Alibre customer must refer you.
Refer-a-Friend leads are the best ones to get, so we reward customers with free maintenance when their referrals buy. You can get complete details on Alibre’s Refer-a-Friend program and begin inviting others immediately at http://www.alibre.com/company/programs/refer.asp.
Customers that purchase Alibre Design Standard V11.2 for $99 can also upgrade to V12 by purchasing a maintenance agreement for $299. In addition to V12, the $299 maintenance agreement includes one year of telephone and online technical support and rights to any new versions or upgrades released in that 12-month period.
Oh, one more thing, for those lonely folks that don’t know anyone that already owns Alibre Design, or for those that just want to get V12 at the best possible price, we are selling Alibre Design Standard V12 plus maintenance for $398 ($99 + $299) to all comers, through the end of October.
We are happy to announce that Alibre Design V12 will be available for download and customer purchase on September 29, 2009. This is a great new release featuring many important feature and performance updates. A summary of the enhancements to V12 can be found here. A 40-minute video demonstration of V12 can be found here.
Alibre will also end its very popular $99 Challenge Offer for Alibre Design Standard V11.2 on September 29, 2009.
To celebrate the success of the $99 Challenge Offer and to thank all of our new customers we are extending the $99 special pricing to Alibre Translate and the Alibre Design Training Bundle for the duration of the promotion.
Alibre Translate normally retails for $499 and extends your import and export capabilities to cover all major CAD formats including:
Alibre Design Training Bundle combines our best self-paced training resources
for Alibre Design into one low-cost package. The included videos, tutorials,
and manuals cover topics ranging from beginner lessons to more advanced
concepts, benefiting all Alibre Design skill levels. The training bundle
Customers that purchase Alibre Design Standard for $99 can upgrade to Version 12 by purchasing a maintenance contract for $299. Maintenance includes all upgrades, enhancements and service packs plus online and telephone technical support for one year. Customers are encouraged to purchase maintenance before v12 is released to ensure they get the lowest maintenance price possible.
All new Alibre Design customers, including those purchasing Alibre Design Standard for $99, are eligible for “Installation and Getting Started” support during the 30 days immediately following purchase.
All customers are also encouraged to purchase Maintenance along with their version of Alibre Design, as it provides valuable additional support and software update options. Maintenance prices are $299 for Alibre Design Standard, $349 for Aibre Design Professional, and $399 for Alibre Design Expert.
Customers must be on active maintenance to receive periodic software updates and new version releases. Customers on active maintenance also receive technical support via telephone, email, and the Internet for a period of one year.
Alibre typically releases one major software version update per year and several minor updates. The current release version number is V11.2, which indicates that Alibre Design has been updated twice since the initial release of V11.
Alibre Design V12 is currently in the final stages of development and testing and should be released in several weeks. You can see detailed information about V12 at http://www.alibre.com/v12sneakpeek.
Finally, we are pleased to announce that customers who purchase during the $99 Alibre Design Standard Promotion are eligible for free “Instructor Led” Online Training Seminars and can sign up at https://www.alibre.com/training_support/requestwebinar.aspx. There is no charge for these webinars during their first 30 days.
"There’s a 'new normal' now where people are saving more, consuming less, and being more frugal and thoughtful in their purchases."
Mark Duke, Wal-Mart President and CEO
It may seem a bit unusual for a CAD company to quote the CEO of Wal-Mart, but these are unusual times and Alibre is no ordinary CAD company.
Our $99 offer caught the competition flatfooted and woke up a sleepy CAD industry dozing at the end of a long hot summer.
Customer and industry response has been incredible and the buzz has been extraordinary. All of the major CAD bloggers and several major CAD publications have picked up the story. It has been very interesting to see the CAD blogging community emerge and take on the dual roles of real-time news reporting and independent analysis.
Their headlines pretty much say it all:
Alibre's Ridiculous Offer - Scott Wertel's Harangue
Everything in the Entire World Marked Down to $99… Including Alibre Design – SolidSmack, Josh Mings
Alibre $99 Pricing Sends Shockwave – CAD Insider, Roopinder Tara
for parametric 3D history-based CAD? Now that’s negotiating! – Dezignstuff,
$99 Alibre Design Standard Opens the Era of Retail MCAD - Maybe - CADCAMNet, Randall Newton
Alibre Slashes Price by 90% - Desktop Engineering, Kenneth Wong
$99: Alibre Drives Down the Cost of MCAD (Temporarily) – WorldCAD Access, Ralph Grabowski
Alibre CEO, J. Paul Grayson, Discusses the New Pricing Structure – Novedge, Franco Folini
Alibre Cuts 3D CAD Price to $99 – Cadalyst Calls on Vendors to Clarify Overall Software Costs – Cadalyst, Nancy Spurling Johnson
Customers are expressing their appreciation by email, phone and with the ultimate compliment, a credit card purchase. As I write, we are scrambling to meet demand and the “Cha-ching” of $99 sales is echoing from our web store into my email inbox.
Many great companies and innovative designers bought in the last week. In many cases, they bought multiple seats or upgraded to Alibre Design Professional or Expert, and bought maintenance, training and other add-ons.
Most opinions are positive, but there is a smattering of negative reaction. The negatives comments seem to fall in three categories:
We anticipated that people would say that we were desperate. But seriously, we honed our business model to be profitable giving away free software. How hard can it be for us to make money by charging for it? We are profitable; cash flow positive, debt-free and have been self-funded since 2001.
We started discussing the $99 offer concept about 90 days ago. We held internal discussions, including vigorous debate. Part of that debate included surveying our VAR’s; we have over 100, most of them outside of the United States. We have greater participation from our VAR’s for the $99 offer, than any special offer we ever made.
We are near, or at the bottom of the “Greatest Recession” since The Great Depression, which means that Alibre’s $99 offer comes at the time when it is most needed and the time that it is most appreciated. Customers and companies have become frugal, for the first time they pushing back against the exorbitant prices they have been paying for 3D CAD. 10’s of thousands of customers have delayed new seat purchases or let their maintenance contracts lapse. This may be the best time in the history of CAD software to make such an offer.
No one, least of all the big CAD companies, are publically defending their pricing or refuting Alibre’s ability to get the job done. I bet they are just keeping their mouth’s shut and hoping it goes away.
It would be interesting to be a fly on the wall at SolidWorks, Autodesk, or PTC’s headquarters. What are they thinking? What about the VAR’s? They must really hate this. I wonder how many have had deals killed when their prospects buy Alibre Design, saving them $3-5K PER SEAT in the process. At a minimum you can bet their prospects are demanding and receiving BIG discounts if they decide to stick with the incumbent.
There was a quote attributed to Bill Gates during the Desktop PC Software wars between Microsoft, Lotus, Wordperfect, and Borland. He was reported to say, “I count every application software dollar that we sell as being worth two dollars, the dollar that Microsoft gets and the dollar that Lotus doesn’t.” Using this math every $99 dollar sale we make is worth $5099 dollars, the $99 we get and the $5000 that the customer gets to keep.