In 2007, Rod Smith and Don Stavneak started Volano Solutions, a custom software development company. In 2012, they developed their first stand-alone product, Steelwool. They learned a lot from the experience.
“One of the lessons we learned with Steelwool is that if you undervalue your product, people won’t see it for what it’s worth,” said Smith.
Pricing products is always tough, and Smith and Stavneak was challenged by the big difference between consumer and enterprise software pricing models.
“When you do consumer products, it’s an app in the app store, so people have this mentality, ‘I can get this software for 99 cents,’” said Stavneak. “Business to business is a whole different game.”
Thanks to our sponsor
Just because your product does something similar to a consumer product, doesn’t mean it’s worth the same to the end-user.
“[A workflow app] provides more value to a business than a to-do list provides to a consumer,” said Stavneak.
A change in the price also targets a different customer.
“Your price point dictates your audience,” said Stavneak. “If you want to go for enterprise level clients, don’t price it at $99/month. Now you’re targeting nonprofits or microbusinesses.”
When you target a different market, those customers may not be as desperate for your solution.
“My price point brought me an audience that wasn’t a fit for my product,” said Smith. “I probably could’ve sold it for $1,000 a month, and it probably would’ve been a lot more effective.”
Steelwool’s unexpected benefits
Volano still serves customers who use Steelwool, and the product generates revenue every month, but they are not actively developing their customers for it.
“I like to say that it’s ‘on ice,’” said Smith.
Nevertheless, Steelwool has been a helpful tool in selling clients on Volano’s custom services. It shows what Volano does best, and it functions as a starting place for collaborating with clients on other projects.
“People can watch as I’m demo-ing it and go, ‘Oh, I get it! You know if it did this and that, that would totally work for us,’” said Smith.
Bringing Action Card to market
In February 2014 Volano released their second product, Action Card.
Retail chains regularly send out field teams to franchise locations to check for consistent brand standards. Typically, those checklists have been done with pen and paper, and then get promptly filed away.
Action Card manages all that data, updates it live, and creates an automatic list of what to fix. It creates what Volano calls an “actionable report card.”
It also allows for immediate accountability. For example, a field team can take a picture of incorrect signage, have the team fix it, and upload a second photo of the corrected action–all before leaving the site.
“It’s about making those field teams as effective as they can be,” said Stavneak.
Action Card has seen steady growth. It’s now used in over 1,800 locations through the US. It’s being used by companies around the world from Godfather’s Pizza to Ripley’s Believe or Not.
Smith and Stavneak have brought their experience with Steelwool to Action Card. Even so, they’ve found new challenges when scaling their prices.
A pricing method that works per location for a company with 10-50 locations might not work for a company with hundreds or thousands of locations.
“We went through a number of iterations trying to price Action Card,” said Smith. “We’re in a much better place than we were early on.”
