Best Practices For Transition to Vertical Solutions Marketing – Part 2

Vertical Marketing System is a distribution channel structure in which producers, intermediaries and retailers agree to act as one to serve their agreed-upon target segment(s). There is clear value in having a single source of expertise that can provide an end-to-end, fully reliable, fully integrated solution which is also forward, backward and horizontally compatible with its current and emerging technology standards. A Vertical Solutions Marketing (VSM) approach has the potential to increase market share within the target segments, and total revenues, profit margins and customer loyalty, compared to the more traditional approach.

The transition to an ideal vertical solutions marketing organization cannot be accomplished in one step. Here are some of the best practices that need to be followed to do so:

Top managers should become more involved in business strategy and marketing decisions

A diversified firm means top managers spend more time on corporate level planning rather than business level planning. A firm’s portfolio will probably hold fewer businesses after adopting VSM; thus, the demands placed on top management time for portfolio planning is lessened, and more time is available for hands-on involvement in the business.

Provide compensation systems and evaluation systems that support the transition

It is important for the compensation system to reward the transformation process at the most senior levels, which includes rewarding revenue contribution and profitability from the strategic vertical market. This helps in shaping the market orientation and performance of the entire organization and within each existing business unit. Another mechanism to facilitate integration is managerial control systems. The best practice model would recognize the need to report on vertical market performance and contribution within each of the existing businesses and in aggregate across the entire firm.

Develop an integrated product/service solution scenario based on your understanding of the target vertical market.

We are awarding some of the best Digital Payment Solution of the year along with other categories at the 3rd Indian ISV Awards 2018, an initiative from itVARnews (Techplus Media Publication) to acknowledge the best ICT Solutions by ISVs (independent software vendor), Systems Integrators, Solution VARs, and MSPs across India. To know more, visit the website now.(http://www.isvawards.itvarnews.com/)