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Industry Solutions: Look Before You Leap

November 04, 2010 | By Marisa Kopec

Before your enterprise makes the decision to go vertical, SiriusDecisions recommends you ensure that moving to an industry-oriented go-to-market strategy is the right course of action. 

Before your enterprise makes the decision to go vertical, SiriusDecisions recommends you ensure that moving to an industry-oriented go-to-market strategy is the right course of action. 

A common mistake to avoid is assuming that “solution” is synonymous with “industry.” We define “solution” as the matching of a customer or prospect’s identified needs to your marketing, sales, delivery and support efforts, with the end goal of innovating a solution designed to solve a business issue. Many times the solution or product is industry-agnostic, allowing for a horizontal solution approach.  

Horizontal solutions are crafted by identifying a common business challenge such as a new regulatory requirement, technological change, emerging market opportunity or need that spans across industries. A horizontal point of view might just be more relevant and compelling to a prospect than a value story based on industry alignment.  

Here are three primary lenses to use when determining if your company should go vertical: 

  1. Customer Lens. Do your customer segments naturally align to industries, or do your prospects tend to cluster around a common business theme? If your prospects don’t need to be marketed to by speaking an industry vernacular, then focus your messaging and promotion efforts on how your solution solves a business problem. A horizontal approach will most likely be more efficient because you don’t have to tailor your collateral development and Web production to multiple industries. Do the math and make sure the investment in agency and media spend is worth it for every industry. You will most likely discover a horizontal solution approach will be much more cost-effective.
  2. Product Lens. If your organization is not innovating product or solutions specifically designed to address a business issue that’s truly unique to a given industry, then ask yourself: What are the benefits of creating a “solution veneer” that gives the customer the impression you have an industry solution, when you honestly don’t? A common failure of industry marketing is that while Web sites, advertising and messaging attempt to promote an industry solution, the vaporware dissipates once the prospect proceeds further down the purchasing process and realizes it’s really the same product on the shelf for everyone. Although you may find a quick short-term boost with a vertical solution veneer, long-term you will be challenged to deliver on implied promises, a fact that competitors can and will expose. 
  3. Sales Lens. When sales territories are aligned to verticals, a vertical marketing approach can create powerful synergies between marketing and sales. The challenge is that most organizations don’t have the sales capacity to segment their territories by industry. If your organization does not have the scale to align reps to industries, it may make more sense to focus on a horizontal solution approach to reduce complexity. 

Summing up, look before you leap into vertical solution marketing; make certain it’s the right go-to-market strategy for your enterprise. We recommend first dipping your toe in the water, testing your organization’s ability to successfully execute by piloting a vertical marketing approach with one or two key industries.  

Marisa Kopec

Marisa Kopec is Vice President of Innovation and Product Management at SiriusDecisions. She is member of SiriusDecisions' Executive Leadership Team and also serves as a Research Fellow. Follow Marisa on Twitter @Marisa_Kopec.
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