Optimizely Raises $58M
blog.optimizely.com
blog.optimizely.com
If you're coming from anywhere else, like an ad, it's going to be linked to a landing page tailored to that source. For example, if you search "A/B testing" on Google, you'll find an ad that links here, not to their homepage: https://www.optimizely.com/ab-testing
Their original product was pretty straightforward: easy-to-use A/B testing. Put in your site, drag and drop some stuff, click go, and it'll tell you if one version performed better. Their old home page reflected this, and mostly tried to get you to take it for a test drive (you could enter any URL and play around with it).
The new product is MUCH more upmarket. They're looking for companies that have enough traffic that you can cut your visitors 5 different ways and still have a meaningful segment to market to. Between this and the fact that it's new news, the homepage is deliberately information-light. They know you know them, and they want to get on the phone.
My prediction is they drop back to something a bit more interactive / descriptive once the buzz from their raise and launch dies down.
[1] Super over-simplified rule of thumb: If you see "Solutions" in their nav menu, it's enterprise software.
As the target audience for Optimizely and an ex-customer, I have to say it annoys me to no end that they are so light on details. My time is limited and I don't want to have a conversation with a rep until I can see more of what it offers. Pretty much every analytics platform out there falls into this trap.
Half the time the sales reps can't even answer my questions so I have to waste even more time with a sales engineer on a followup call to just see basic things like pictures of the interface.
Oh the horror! Just the other day I was getting a cappuccino from my local cafe, and as the barista expertly poured out a perfect latte-art fern, I thought to myself, "man, if only this process could be optimized using data, like they do at Starbucks." Then I sat at my computer and read some idiosyncratic posts from my favorite blogger. After enjoying a few posts I said to myself, "man, if only he could optimize his blog posts for maximum clicks like Buzzfeed does. Why doesn't he use data to make his experience better?"
</sarcasm>
I do generally dislike cheap negativity when responding to startup news. But this first paragraph was really tone-deaf and deserving of ridicule. Let me try to balance my criticism with some constructive advice for rewriting this press release.
Drop the first four sentences. Start off with, "When Pete Koomen and I founded Optimizely five years ago, very few companies had even heard of A/B Testing, and optimization software was about the last thing anyone considered putting in their technology stack." Then give an example. "When we first helped XYZ Sporting Goods optimize their site, we knew we were on to something. Not only did we help them write more compelling copy and better imagery that bettered their sales, we also created a much better experience for their customers. No longer would visitors click away because they could not understand what the site did, or what their message actually was. A/B Testing and data based optimization allowed us to match the website to the people who were actually visiting their site. Fast forward to 2015 and much has changed...."
Not every company is going to change the world. But you can still write a compelling, feel-good narrative without making me want to throw a shoe at the screen.
That is, until they changed their model and began to push agencies off the platform by insisting that the client and not the agency must have the account relationship with Optimizely, and the agency can then "work" on the account but no longer under one account spread across multiple clients.
I have no objections to pricing changes and strategy pivots, more power to them and I understand to develop more and more features, pricing must be raised to match usage. We would happily pay more per month, however we don't see the business sense in handing over our client relationships directly to Optimizely so that our clients could then choose to drop us as an agency at anytime, but keep the Optimizely account.
An account that would be full of our work product, testing ideas and custom code developed to implement tests that a client could now easily take to another agency and continue benefiting from the work.
(Yes, we have contracts with our clients, but we are not naive enough to think that clients won't look for a way to do away with our fees if they can take our services and work product with them.)
Our ability to utilize the tools provided by Optimizely and build winning tests has helped us grow our business, but this change in agency support has caused us to need to look for alternate solutions.
It would be great if some of this latest raise could be used to re-invest in agencies again, providing a client manager style interface where multiple accounts/sub-accounts can reside under one login. Even if each client needs to have a different pricing structure based on their usage patterns, can't share visits across clients, but could be arranged and managed by the agency as one point of contact and billing.
I'd love to kick back up our usage of the platform, as the new features I see them rolling out are enticing and I am sure this raise will only accelerate that, but we can't commit to a vendor that seems to actively enable and almost encourage our clients to circumvent our own service model.
I worked at a company where we paid $400 / month for Optimizely, based on having ~20k uniques. That seemed fair. If you take that up by 100x, $40k / month might not sound fair. You can cut the pricing at that point and say it's $10k / month, but there's a world of difference between a B2B site and an ecommerce site. The usage patterns are different, so the value received and load put on Optimizely are different. It bears different pricing.
Beyond that, sales reps aren't all bad. If you're going to lay out $200k for a product like this for a year, you probably don't want something that you just email out a bunch of logins and say "hey team, try it out, let me know what you think." Talking to a human being can help an exec figure out the way their organization can use it the best and help them get that implemented. Yeah, they're biased, but people who deal with sales reps know how to mitigate that bias, and a good rep can be the difference between a successful implementation and a failed one.
I'm the target of a lot of analytics and ad tech/network sales people and at this point in my career I loathe talking to them. Many try to blow smoke up my ass, try to mask deficiencies about their product instead of just being honest about shortcomings and trying to explain why the value is still worth it, and the list goes on.
Hell, I've had some ad tech sales people flat out lie to me and then had their executive boss get mad at me when I called them on it because I was lied to. They tried to say the sales guy made a mistake and couldn't offer what they had offered. Oops!
As soon as someone comes up with a way to cut out sales people from enterprise sales I will shower them with money.
I think you've got the right of it though: "As soon as someone comes up with a way to cut out sales people from enterprise sales." We haven't figured it out yet, so we all get to deal with bad behavior and absurdly annoying appointment-setting tactics.
Now I just get a cluttered inbox, not voicemail as well.
How else would you do pricing? That's how its done.
I do not doubt this is typical for enterprise sales but as a customer it is very frustrating and leaves you with a constant feeling that you are probably being done-over. Not to mention that because every sale is a high-touch process starting with sales it means that a significant portion of the cost is the employment of all these non-scalable sales people.
I hate the 'call us' pricing model. But I don't deny it probably works well for them.
In your head you have a maximum you will pay for some good or service based on the marginal value it would give you compared to the marginal cost. The goal for a seller is to find this number for each customer and sell to them at that price. In such a case, both parties are better off in total even though there may be a very wide delta between COGS and income.
Genuine question. I'll give them a 2nd chance if someone can convince me.