Alibre Slashes Price by 90%

In what’s described as “the boldest marketing initiative in the history of 3D CAD,” Alibre this morning begins offering Alibre Design, a product previously sold for $999, for just $99.

The whopping 90% discount is bound to get CAD buyers’ attention. It’s already fueling a lot of retweeting (voluntary redistribution or the news) on Twitter among CAD developers and users. The unprecedented move suggests Alibre is waging an all-out war against not only its competitors but also the grim economy.

In his blog, Alibre CEO Paul Grayson characterized the offer as “a massive market share grab.” He pointed out,“The [Alibre] technology is virtually identical to that offered by Autodesk Inventor, Dassault SolidWorks, Siemens Solid Edge, and PTC’s Pro/ENGINEER. And those products normally cost $5,000 and more per seat.”

Though Alibre says the offer will run for “a limited time” only,  it has yet to declare a deadline, suggesting the campaign might run so long as it continues to generate sales.

Earlier this year, in February, Alibre ran a “buy one, give one” campaign, which enables Alibre buyers to give a second seat of the same software to a designated recipient. In the announcement, the company clarified, “The recipient can be an associate, a subcontractor or supplier, a coworker, or a deserving engineer.”

In addition, the company offers Alibre Design Xpress, a lighter version of its CAD software, as a free download to entice prospective customers.

This morning, as Alibre launched its latest $99 campaign, market watcher CIMdata issued a mid-year update (a revision, to be exact) to its previous product lifecycle management (PLM) industry forecast. “The global economic situation has been even more severe than anticipated,” acknowledged CIMdata.

In March, CIMdata predicted the comprehensive PLM market (which includes CAD sales) would achieve a 6.3% compounded annual growth rate (CAGR) over the next five years. The company revised its report to indicate PLM investments in 2009 will decline 2.1% (from 2008 results) and the five year CAGR will be 3.5%.

At online CAD software distributor Novedge‘s site, Alibre Design is currently listed for $799. Franco Folini, president of Novedge, said, “From my experience, [the $100 software segment] is not an easy segment where to sell a CAD system. It can be difficult to do business in this segment for resellers such as Novedge, unless the product generates huge volumes or quickly push for upgrades to higher versions.” Folini emphasized this is his personal opinion, not Novedge’s official position.

Max Freeman, Alibre’s vice-president of marketing, said, “[Our reseller arrangements] are basically set up to where we will not out-price them and the vast majority of them are on board with the [discount] initiative.”

At this price, Alibre Design costs more than a consumer-level photo-editing product like Corel’s PaintShop Pro Photo X2 ($49), but less than Google SketchUp Pro ($495) and Autodesk Autosketch ($200 for download, $250 in a box), and the same as IMSI/Design’s TurboCAD ($99).

The price dip also puts third-party developer SYCODE, which markets its Alibre add-ons for $195, in an awkward position. In his blog, SYCODE CEO and founder Deelip Menezes revealed he’s considering a price slash too, at least to put the add-ons on par with Alibre Design’s new price.

For more on this topic, read Menezes’ blog post.

Note: A quote in the post was subsequently revised to better reflect Franco Folini’s sentiment. New information was also added to provide SYCODE’s perspective.