If you're a B2B company with a horizontal platform considering vertical expansion, how would you structure your approach for deciding what new vertical(s) to enter into? More specifically, how do you handle the tradeoff of addressing many/most of the needs for a specific vertical vs. only addressing 1-2 needs for multiple verticals?

Great question, and always exciting to be at a juncture where you're considering expanding your GTM to address specific verticals and opportunities. Getting a vertical right is not always easy, but when you have the right structure and offerings, the work across other opportunities is very repeatable.

There are several ways to think about this from a marketing approach:

1. Picking the vertical: Spinning up a vertical marketing strategy within marketing is a big bet because you have to orchestrate a lot of bespoke programs and content across demand gen, content marketing and sales enablement, to name a few. So stack ranking and picking the right bets will be essential. The way I've seen us pick verticals, whether it was at Google or Matterport was to keep our ear to the ground with sales and other customer-facing parts of the organization as to where we were seeing repeated requests from a particular industry or functional area. This could be financial services or retail (industry verticals), as much as it could be marketing or sales (functional verticals).
   
   Seeing where the chatter is can help you prioritize. If those teams are busy you can also analyze the opportunity data yourself, and look at deals that might be stuck in a particular area for lack of a solid product offering. Ideally, sales leadership should have that information and as a marketer you should make it a point to be across those weekly touch-points. Having the right hygiene in salesforce about this will be key for everyone, but in a pinch, you can also hopefully quickly scan recordings of those sales calls to further validate which areas could be ones of opportunity. That's the best approach in my mind as it's organic and rooted in the reality of the conversations you are currently fielding, but perhaps not crushing.
   
   The other way of picking the vertical is to do the market research and opportunityr leadership team and develop sizing with you a strong view of where you could go next. You'll have to sift through a lot of opinions there, and as a product marketer, you'll need to be very aligned with the product team on what the product is ready to tackle to enable sales to have the most authentic conversations. I'll leave you with one anecdote here. Google Sheets didn't have page numbers enabled for printouts for the longest time. Not surprisingly, that was the number one complaint we got from customers in financial services for not adopting the tool, because it meant we didn't understand the needs of that particular vertical. They weren't wrong. For all our talk and focus on moonshots, we shot ourselves in the foot by not clamoring for those table stakes.

2. Focusing on one or two verticals at the most: A common pitfall when adopting a vertical marketing strategy is taking on too many verticals at one time. Sure, you might have hired an industry solutions whiz, or brought some capabilities that should be replicable across several verticals, but you still have zero flight time going deep in understanding what makes those customers tick, how they procure things, who do they trust, etc. You have to get the psychology right, and then, if you're doing full stack marketing against those opportunities you have to obviously get the physics right. That's very very hard to nail all in one go, let alone across multiple verticals. So my recommendation is to start small but go deep. It might take a quarter or two to land that first big vertical customer, but when you do, you'll have a goldmine of insights on how to knock out the others. At Matterport, we started with a lofty goal of "Winning the Verticals" and had all the right people involved in terms of building an encompassing strategy to go after them. We had a robust plan, but were spread to thin. We then shifted to a Win a Vertical strategy, and that then helped set the stage for great, repeatable work.

3. Nailing the offering in a way that's replicable: We talked about focusing on the few vs the many, I'd argue that's also the outlook that product marketing can advocate for with product in terms of what will be the set offerings that are bespoke and essential to acquiring those verticals. It'll be tempting to go after a particular vertical and advocate for a whole set of features that cater to them, but the key ones are more foundational. Are you FedRamp/ISO/HIPAA compliant. Ironically, a lot of industry-based stage gates to penetration are process-driven vs feature-driven. There are checkboxes you'll need to seek out and make sure your offerings can meet before being considered a serious contender.
   Of course you also need to build the right features. That's where understanding the psychology and workflows of the users you're targeting will matter. Which leads me to my last recommendation

4. Accelerating your execution via SMEs: A total cheat code for accelerating your vertical penetration is to hire or consult with a SME from that industry who either was in sales or in BD there, but may be looking for a job or advisory gig in tech. Sounds crazy, but anyone who has that industry experience will help you understand the psychology and physics of that industry in record time. I learned that from my consulting days where a key-opinion-leader or KOL provided us with all the right inputs on how to frame our analysis. Ideally you want to have someone like that across each vertical. You don't have to hire them, but if you're serious about that vertical, they're worthy every penny.
   
   

Verticalization is a strategy that horizontal platforms should postpone as long as possible to keep their TAM as large as possible for their next funding round or exit. I recommend only verticalizing after you've exhausted horizontal (i.e., non-industry-specific) use cases. In my experience, most pain points are universal but described using different language in each vertical.

Here are a couple of lessons I've learned helping products verticalize after the decision has been made:

1. Cultivate a Partner Ecosystem - Leveraging partners is the best way of verticalizing. I would ask the product team to open up the platform so that partners can use their vertical expertise to customize your platform for vertical use cases. Just ensure that there is a fast and easy way for partners to copy the IP they create (objects, workflows, integrations, APIs, etc.) from one instance to another so they don't have to burn resources creating the same functionality multiple times.

2. Ensure Veticalization is a Company Strategy - Your business must have an aligned product and go-to-market vertical strategy. When Salesforce first tried to verticalize, they set up a manufacturing sales team in. The problem was that there was no product truth to help them be relevant in manufacturing, and there was little air cover because there was no subject matter expert marketing that could tap to speak the language.

3. FOCUS - I remember when Keith Block became the COO at Salesforce, one of his big initiatives was to verticalize. Our first attempt went poorly because we tried to enter too many verticals at once. The unlock for Salesforce was stepping back and focusing on 1-2 verticals at a time. This allowed us to figure out how to prioritize our roadmap, how to build our sales teams, what our GTM structure should look like, and who we should be partnering with.

4. Prioritize your best product-market fit - Most products tends to skew toward a vertical. Look at the composition of your customers and revenue to determine where you naturally have the best fit. Make sure to do an outside-in analysis as well to ensure your best vertical is one that you should enter.

To move to verticals, you need verticals large enough to support a dedicated GTM strategy and distinct enough to justify dedicated resources. Essentially, is the vertical unique enough to need its own Sales and Marketing team, and is the opportunity significant enough to warrant full-time attention?

At Docusign, we face this question frequently. While virtually any company can use our technology, certain verticals like Financial Services, Healthcare & Life Sciences, Public Sector, and Real Estate have unique requirements and often regulations relating to agreements. In each case, these are also sizeable verticals where agreements play an important role in what they do. Balancing between industry-agnostic and industry-specific is tough.

Here's how I think about it:

• Vertical Sales and Marketing Alignment: If you have a vertical marketer, you need a vertical sales team. This ensures effective planning, aligned incentives, and strong feedback loops.

• Combination of Vertical and Horizontal Focus: Depending on the number of verticals, you might still need people focused on horizontal solutions. For example, four vertical marketers are manageable, but fifty aren’t. At Docusign, we balance this by dedicating teams to Lines of Business, Industries, and International.

  • Lines of Business: Develop industry-agnostic content, mapping to our GEO (non-vertical) sales org.

  • Verticals: Create industry-specific content for unique processes or regulations, mapping to industry-specific sales teams..

  • International: Produce regional-specific content and adapt content from LoB and Vertical teams to fit regional needs, mapping to our regional sales teams.

• Unique Value Proposition: Ensure you provide unique value for the audience before creating those teams. Are you offering industry-specific functionality or just tailoring a horizontal story?

• Choose Proven Verticals with Promise: The vertical should be established yet offer significant future opportunities. Look for referenceable customers, substantial revenue, industry-specific partners, and a large TAM with growth potential.

• Focus on a Few Verticals: Start with a few verticals and excel in them rather than trying to support many at once. Effective focus is more impactful than spreading efforts too thin. Avoid the pull to support the long-tail of verticals.

Focus and strategic alignment are crucial for successfully moving to verticals. Starting small and scaling based on proven success is more effective than trying to support too many verticals from the outset.