Mathsoft (A) Essay

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MATHSOFT, INC. (A) Synopsis MathSoft's VP of sales has doubled the size of the company's direct field sales force to support the launch of a new, high-end workstation software product priced at almost $9,000. However, sales of the new product are far below plan. At the same time, the VP of marketing is calling for increased magazine advertising to support sales of the company's $349 personal computer software product, which has been marketed through a combination of distributors, retailers, telephone sales, and direct mail. The president of this entrepreneurial company must determine the appropriate channel structure and communications programs for MathSoft's current product line and future growth. Background • Started in mid-1985 by David Blohm and Allen Razdow. • Principal mission was to develop and sell productivity tools for technical professionals especially engineers and scientists. Their first product – Mathcad Mathcad • Mathcad was influenced by the success of spreadsheet software. It featured a novel user-interface, designed to work like an electronic board. • Mathcad – version 1 was launched at a list price of $189. First year sales jumped to $1.6 million Product Line Extension • They upgraded Mathcad twice (version 1.1 and 2.0) and increased its list price to $349. • Mathsoft also extended its product line by introducing a series of Mathcad add-on called Mathcad Application Packs (APs) • APs contained specialized, ready-made Mathcad files for certain types of mathematical analysis such as statistical testing and modeling • APs were introduced in 1989 and was initially priced at $40 • By 1989 they repriced the entire APs to $99. By the end of March 1989 Mathsoft has sold more than 4,000 APs MathStation • Mathstation is a high-end software package designed to run on Sun Microsystems workstation. • Designed to be the engineer’s

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