www.chicagobusiness.com/cgi-bin/mag/article.pl?articleI -
[Cached Version]
Published on: 11/7/2009
Last Visited: 11/7/2009
Ada Vaughan is executive vice-president of Allegro Communications Inc. in Lombard.
...
But until last year, FreshDM remained "the ugly stepchild techie thing to our core creative business," says Ada Vaughan, 38, Allegro's executive vice-president.
...
"We changed our business model from being project-to-project to something more sustainable," Ms. Vaughan says.
"With creative, you're always hunting, hunting, hunting.
This is sticky — it has the opportunity for built-in renewal."
Initially, Allegro farmed out the software development.
But as interest grew, the agency hired its own developers.
"It was our first 'greenfield' investment, kind of, 'If you build it, they will come,' " Ms. Vaughan says.
"We invested probably $1.4 million to $1.6 million of our own money to build code that we had no customers for."
FreshDM's most recent version was completed in 2007, just as the recession was taking hold.
So when clients started asking about cheaper options for sales letters, postcards and the like, Allegro had something to offer.
"They may come in thinking they want something custom, but then they see an existing tool that they can subscribe to and that does most of what they want, and it's fast and cheap," Ms. Vaughan says.
"Clients pay one-fifth or less what they'd pay for a custom tool."
'We changed our business model from being project-to-project to something more sustainable.'
— Ada Vaughan, executive vice-president,
Allegro Communications Inc.
...
Ms. Vaughan, who says Allegro would "be dead" if it hadn't shifted gears, now breathes easier all around.
"Before, we couldn't scale our price based on our effort.
We charged $400,000, but should have charged $800,000," she says.