Industry analysts are predicting the cloud UC market to grow exponentially. At 54 million seats in 2017, billions of capital are still expected to enter the market in 2018 along with more competitors hungry for a slice of the potential profits. With this degree of volume, differentiating enough to stand out is becoming a bigger challenge. Appealing to vertical markets is increasingly recognized as the new frontier for cloud UC service providers.
Vertical Markets 101
Given that companies are increasingly focusing on cloud solutions, it’s important for UC providers to know what companies prioritize today and acknowledge the value of vertical marketing. This option can help your business increase revenue and narrow the competitive pool by boosting your service offering and credibility in a specialized area.
To illustrate the point, there are about 187 cloud UC companies worldwide today. Some verticals are remarkably large, such as healthcare and customer service, which make them ideal for industry-specific marketing. Cloud vendors can designate indirect marketing dollars to a couple of industries offering reasonable prices.
Taking Advantage Of Vertical Marketing
When buyers are looking for cloud solutions, they tend to do their research and have already identified their needs and budget by the time they contact a potential vendor. To maximize your chances, implementing a strong SEO strategy is necessary in order to stand out during a potential customer’s initial research phase.
To focus your online presence, choose the specific field that you want to target and match your pitch with the appropriate buyers. Appeal to them and familiarize yourself with their challenges and opportunities. Many verticals have not been singled out by cloud providers yet, leaving the field relatively open for targeted messages.
The key to success in vertical marketing is to start small and reach for a segment that presents the lowest risk for the biggest payoffs. Though this means less opportunity for higher profits initially, it gives you the ability to perfect your processes, messages, and offerings. Once you have done this legwork, you can better assess the available opportunities and hone in on those with the most money to spend.
Recent research has shown that three factors are currently driving the market towards more growth. These include enterprise customer behavior, enhanced UC features, and an increase in service providers.
Enterprise Customer Behavior
Enterprise customer behavior is a small portion of the market. 10% of large businesses have UCaaS and use cloud computing. As the use of cloud computing continues to grow, the enterprise market for cloud solutions does as well, promoting cloud UC as enterprise-grade technology and thus more attractive to smaller companies as well.
Collaboration, integrations, and APIs are expected to double or triple the average revenue per user (ARPU). In addition to the market becoming more specialized, businesses are seeing the need to specialize their operations as well. Integrations and APIs allow organizations that need CRM and other applications to enhance productivity to customize their workflows to their unique needs. Cloud UC vendors who can accommodate this need stand to gain some additional ground in the marketplace.
The third factor driving this market upswing is the influx of thousands of service providers into the market. In order to enter the market, service providers must develop increasingly sophisticated offerings, which lead to more differentiation and higher standards overall.
The Final Verdict
In addition to the overarching trends already mentioned, providers and investors are continuing to seek acquisitions leading to market expansion with increasingly powerful UC provider organizations. This increases the difficulty for small business and startups to compete on the same scale but increases the importance of vertical marketing and specialization. In a couple of years, it’s predicted that the amount of cloud UC companies will increase by several hundred, so becoming a leader in vertical markets now will likely pay off greatly in the near future.