By definition, a vertical market, (or just “vertical”) is a group of similar businesses and customers that engage in business based on specific or specialized needs. Often, participants in a vertical market are limited to a subset of a larger industry (a niche market).
Vertical marketing has become an extremely important source of sales leads in many industries, including the signage and graphics and visual communications businesses. In fact, we are not the only ones noticing this trend. In May, InfoTrends announced the company’s newest study, “Understanding Vertical Markets: Enterprise Communication Requirements”. The new study will provide print service providers, document outsourcing service providers, cross-media and marketing service companies, business process outsourcing companies, and industry suppliers with the market intelligence needed to successfully target a specific vertical market and establish leadership within that vertical.
For those of us in the sign industry, efficient vertical marketing can offer the opportunity to move beyond the “order taker” mentality. With the increase in technology and the expanded products and services we are afforded as a result, most sign companies can become true one-stop providers for anything and everything visual. Why just take an order for a banner, when your client might also need more products that he or she might not even be aware of?
This is where vertical marketing can really help your business. Whether it’s tailored e-marketing or specialized brochures, sign companies can personalize their marketing efforts industry by industry. Some well known markets for the sign industry include healthcare, education, construction, and retail, among others.
Using retail as an example, these clients amount to a very large part of a typical sign company’s revenue stream. These clients have been some of the hardest hit by the economic downturn, as have the directly related businesses that serve them. With prices on the rise and businesses looking at budget cuts, many retailers and their verticals may not realize that marketing is an area to avoid when considering cuts, as it accounts for most of the new business that comes through their door.
When selling your products and services to merchants, it’s important to point them in the right direction and show them the positive numbers in your vertical marketing activity. Data from the US Small Business Administration shows that signage is the least expensive, yet most effective form of advertising available to retailers. Signage is responsible for attracting half of retailers’ customers, and that ratio is increasing as newer technologies such as digital signage are finding their way into the retail environment.
In another example, a study conducted by the University of San Diego revealed that the addition of new signage to previously unsigned buildings, and the replacement of existing signage typically can produce sales increases of five percent. The study also showed that adding a single, additional on-premises sign bumped sales up an average of 4.75 percent. It’s easy to relay this message to your retail clients to show them that a relatively small investment in new signs can produce a significant increase in their revenue.
These types of vital statistics can be a great tool in your marketing activities, but a complete marketing plan that incorporates vertical marketing of your valuable products and services will take your marketing to the next level.