Why should organizations adopt a vertical “go to market” strategy?
- Customers like it:
Every industry thinks they are unique! Buying behaviours throughout the value chain make vertical markets more important. Clients expect their suppliers to work in vertical markets because they have to work in vertical markets themselves.
- Build on your strengths:
You will probably be focussing on vertical markets where you already have a success story. Focus should allow you to accelerate your growth both in penetrating existing relationships and acquiring new ones. More clients, more income, more market share, more profit.
- Target better:
If you know the industry you are more likely to know the attractive targets. Segmentation becomes better informed, more efficient, more effective. You should be able to track moves and leverage relationships.
- Build a reputation:
Your references will be relevant. People will hear about you but be warned: this works for if you look after your relationships but it works both ways. Reputation management is more important in sectors.
- Focussed marketing material:
You can match your collateral to identifiable personae in specific sectore. Your case studies, examples, quotes and business cases can be more relevant and effective. You will be able to use sector specific language that will resonate with your target audience.
You’ll encounter common challenges and opportunities. This allows you to say “This is well travelled territory for us”. You can demonstrate your expertise with relevant examples. It becomes easier to identify and replicate global best practice.
As customers consolidate their supplier base they are increasingly looking for a limited number of suppliers who can demonstrate specific sector experience. The increasing role of procurement makes this approach to “certified suppliers” for the sector even more important.
As competitors focus increasingly on vertical markets it becomes more and more difficult to be a generalist.
Easier to track penetration, market share.
- Value proposition:
Perhaps the biggest and best reason to work in vertical markets. Of course each customer is unique but there are clear trends and themes. Vertical markets make it much easier to build compelling propositions and demonstrate value.