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More VARs than ever before are throwing their hats into the cloud computing ring. This heightened competition requires solution providers to differentiate themselves. On Tuesday, Nimsoft marketing director, began this discussion in his article, How To Stand Out in the Cloud: Build Security and Compliance. Here, he offers two additional strategies for offering cloud offerings that stand apart from the crowd. —Jennifer D. Bosavage
Delivering cloud offerings that address the needs of companies in a specific industry can be a winning strategy for many service providers. The compliance approaches cited above may inherently have a vertical focus, such as HIPAA and the health care industry, but there are a range of other options for addressing the needs of specific industries.
One approach could be delivering industry-specific applications and capabilities to customers. As mentioned earlier, infrastructure is increasingly becoming commoditized. Most organizations will need to gain differentiation in a vertical through applications, industry-specific integrations, and so on. In the health care industry, this could include electronic medical record solutions, patient management applications, or healthcare billing solutions. These are very important areas for the healthcare market, but many organizations may not want to source them internally. If a service provider can deliver these capabilities in a turnkey cloud solution, they can have a unique selling proposition, and ultimately enjoy rich margins.
Service providers could also deliver specific capabilities, such as reporting solutions that are tailored to helping healthcare institutions comply with HIPAA.
For other organizations, it may make sense to gain entry to verticals through partner offerings. For example, if an organization has hosting expertise that’s more horizontal in nature, they can work with an independent software vendor (ISV) that has developed an application with a specific industry focus, and ultimately market a SaaS-based version of the application.
A vendor could aggregate multiple offerings with a vertical focus. This could include a packaged mix of applications and services, like an enterprise resource planning (ERP) application, database, and storage package tailored to a specific vertical segment.
This move to vertical specialization can be a logical extension if you have a business that’s traditionally served organizations in a specific vertical. For example, if an MSP has a proven track record managing application administration in a vertical, they can build on this experience to host these applications in a private cloud.
For other organizations, the move to a vertical focus may represent a new approach to doing business. To effectively sell into a vertical and differentiate your offerings, your organization needs to speak the language of that industry, and have a detailed understanding of customer environments—everything from the acronyms to the infrastructures and applications. It takes time, resources, and energy to learn this language, which is why it’s important to start with a narrow focus.
In assessing new vertical market opportunities, you should scope the addressable market, looking at the industries represented within the geographic reach of your sales and support organizations. For example, if your addressable region has one of the highest numbers of doctors per capita, that could be a good place to start a MSP practice targeting the healthcare market.
Note that some verticals lend themselves to being more open to cloud offerings than those in other industries. For example, organizations in the manufacturing industry tend to be very open to the cloud, since they have been focusing on efficiency, automation, and optimization for a long time. Executives in this segment tend to look at cloud offerings as a logical next step for their IT delivery.
