A close look at an educational software development firm and how they got their products to the national market.
Edmark had it all: on one hand, gifted employees creating award-winning products and, on the other, consumers who were eager to buy. Too bad it overlooked the customer in between
Never underestimate the power of a customer. Stockbroker Scott McMullin is sheer momentum as he races around a stack of Mortal Kombat II in a downtown Boston software store one lunch hour. Spying a computer screen displaying Bailey's Book House, a children's software program, he recognizes the product's feline star and freezes. "Oh, Edmark! Are you from Edmark?" he blurts to the field rep running the demo.
Before he can get an answer, McMullin launches into a giddy litany of all the Edmark products he owns, what his five-year-old daughter and three-year-old son can do with them, and why the lukewarm prospect who's been staring vacantly at the screen until now should buy anything with the name Edmark on it.
"You should probably start with Bailey's. Yes, she's right about that," McMullin says, nodding to the field rep. "My daughter also loves Millie's Math House. Have you seen Sammy's Science House? How old did you say your son was? . . . OK, maybe you'll wait a few months on that."
By the time McMullin is through with him, lawyer Terrence Cullen will be a new convert to the Edmark brand, his outstretched arms brimming with software and trinkets as he marches toward the register. McMullin will pluck from the shelf one of the few Edmark titles he doesn't own and follow him. And word of mouth will have once more bestowed its kiss on Edmark.
The scene stands as a tribute to a small company with big dreams and remarkable products. To a chief executive who never stops doing her homework or paying attention to what's good for her customers. To a team of talented individuals who deliver products that will push the company to an estimated $20 million in revenues this year. To the patient investors who funded the company's crusade to establish itself despite a welter of competition in its white-hot market.
Too bad great products, great people, and great money weren't always enough to deliver several hundred thousand McMullins. For, despite doing nearly everything right in 1993, Edmark still came up millions short. And it came up far short of chief executive Sally Narodick's best-laid plans for how Edmark might survive in a market stalked by the likes of Microsoft and Disney. "I was devastated," says Narodick, recalling her reckoning late that year that it would take more than rave reviews, blue-ribbon products, and ardent customers to build a great company in a great market. "I thought all that would have more clout," she reflects. "But they couldn't carry us everywhere we needed to go."
Edmark, a company with a solemn educational mission, had to learn that pleasing the McMullins and the Cullens out there was only a prerequisite. The real test lay in understanding its other customers -- the retailers who stocked and sold those products -- so that they, too, might learn to adore Edmark.
Because if your distribution channel doesn't love you, who can?
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"That's an excellent question," answers Narodick, sitting across from a visitor in the company's boardroom. She has just been asked to explain how her product mix fosters a brand identity. Her response prefaces a brisk walk to her board where she hastily draws a diagram to illustrate her logic. Your best teacher, the one who expected your finest work or knew you had more than you were showing, comes to mind: no-nonsense, prepared, persistent, impossible to con.
Gracious but unmistakably serious, Narodick looks like Suzanne Pleshette -- hold the laugh track. Only her blue suit suggests the two decades she spent as a banker. Her financial acumen also reflects those years. "She'll take a balance sheet and an income statement apart quicker than most Fortune 500 CEOs do," says board member Hunter Simpson.
For the moment Narodick, who holds a master's degree in teaching but never taught school, is transforming her boardroom into a classroom.
"We organize the products into families," she says, looking back to make sure her student is following. "Bailey's Book House, Millie's Math House, and Sammy's Science House make up one family: the early-learning line." To clarify, she sketches a genealogical tree showing the propagation of Edmark's product line. It stretches across an array of disciplines -- math, science, reading, writing, critical thinking -- and across a broad swath of customers, kids aged 2 to 12. If Narodick has her way, those kids will spend no small part of their childhood with Edmark, progressing from one title to the next, from one line to the next.
Narodick's reasoning is irresistible. Since a customer almost never needs more than one copy of even the hottest-selling software program, winning repeat business is a function of continually expanding and upgrading a line. "That's the only way to keep them," notes Narodick. "Unless you've got a smash hit, you can't build a brand with a single product."
Five and a half years ago, when Narodick took the CEO's spot at Edmark, the publicly traded company was an obscure, not-quite-$3-million-a-year purveyor of reading products (mostly workbooks) for the special-needs segment of the school market. Narodick's friends and colleagues watched in horror as she leapt from her 31st-floor executive suite in Seattle's largest bank, finally landing in the corner office of Edmark's then-dingy headquarters, also in Seattle.
Although Edmark had earned the respect of educators in its tiny niche, it had earned little else. Profits had been modest and irregular. The company had spent 14 years in a fitful sleep before it broke $1 million in sales. "The business was going to go nowhere as long as it stayed in its small, noble niche," says early investor and former board member Don Barton.
Narodick, a late-blooming entrepreneur (she will turn 50 this year), was recruited by an exasperated board to come in and finally take the company (it will turn 25 this year) somewhere. But where, exactly? Her obsessive habit of "doing her homework" yielded an answer.
