Value Selling Blog

If you are marketing and selling a complex B2B solution, it is critical to differentiate your offering’s value proposition for each market segment. Markets are often segmented using geographic attributes (e.g., continent, country, region, state and dispersion) and / or business attributes (e.g., size, industry, product mix and legal structure). That said, the key factor in your segmentation analysis is how your customers use your solution.

Industry is a frequently used attribute in market segmentation exercises. When customers across many industries use your solution in a comparable way, that is a horizontal market. By contrast, when customers in one industry use your solution differently than those in another industry, that is a vertical market. The approach to your value proposition and value selling program should recognize this horizontal vs. vertical market distinction.

Value Selling in Horizontal Markets

Providing value selling tools is a bit easier when targeting horizontal markets because customers receive value from your offering in an equivalent manner. This includes assessment tools, value calculators and ROI tools.

For example, all customers regardless of industry purchasing a human resources management system expect to receive similar benefits: streamlined employee review processes, lower HR labor costs, improved corporate learning, etc. The value selling tools still need to allow buyers or your sales reps to configure the business case to their unique environment and expectations. Targeting a horizontal market, however, allows for the tools to be built around a singular value proposition.

Value Selling in Vertical Markets

Deploying value selling tools in a vertical market is a bit more nuanced. In this situation, customers in one industry vertical receive value differently than customers in a different industry vertical. In the below example, we see the dissimilarity in expected benefits from two customers purchasing the same enterprise content management system.

The value propositions for healthcare customers and financial services customers are vastly different. Using the approach advocated above for horizontal markets, deploying value selling tools with a single value proposition, will certainly call into question the tools’ relevancy and credibility.

Value selling tools for selling in vertical markets need to be configured around the value proposition for each industry vertical. Sometimes this can only be accomplished by creating one tool per industry vertical, especially if the disparity in the types of benefits is large. Other times a single tool can be configured to serve multiple industry verticals if there is overlap in the benefits among the industry verticals.

This is typically accomplished through a “Choose Industry” feature that displays only relevant content. While this is possible (but difficult) to achieve with spreadsheet tools, advanced web-based value selling tools offer a much better user experience. These smart tools use contemporary design principles and an intuitive interface to dynamically present information to users in an expected manner. This boosts the tools’ adoption, usability and credibility.

Conclusion

A value selling program is an excellent approach to improving lead conversion and growing sales. A key to success is to properly segment your markets and deploy tools applicable to those segments. And to achieve greater success when deploying tools for vertical markets, be sure to present only relevant content and provide a good user experience. If you need help determining whether your product or service line would offers benefits that would qualify as horizontal or vertical, you are welcome to reach out to me directly via LinkedIn or click here to request a complimentary consultation.