Vertical or not?

Tue, 05 Apr 2005 00:26:35 GMT

Selling business IT solutions is very difficult as there is a healthy level of scepticism amongst business owners and managers as to the benefits of IT systems. How do you get around this? Well one way is to focus on a particular type of business or market commonly known as a 'Vertical'.

Some common verticals are Construction, Education, Local Government, Professional Services, Manufacturing, Insurance, Utilities etc.

Going Vertical is a time honoured tradition in the software industry and there are many many vertical and niche products you have probably never heard of and which do very well and with very respectable customer bases to boot. Microsoft has historically had a very good relationship with its Independent Software Vendors (ISVs) who develop these products. Microsoft has tended to provide broad platform products on which its partners build vertical solutions. Microsoft CRM is a simply a broad platform upon which resellers and ISVs can build tailored solutions for many types of business.

The easiest way of being successful in selling business IT solutions such as CRM is to 'Go Vertical'. Look at your existing customer base and you may find that you have a natural vertical or niche that you already have a track record in and hence will have some credibility when you come to speak to other prospects in that vertical. This vertical is where you should look to build your CRM sales around.

As I indicated in an earlier post, Your First CRM Customer, making your first CRM sale can be difficult but if you make your pitch to an existing customer in a vertical you can talk about you will be much more likely to close the deal. This does mean you need to tailor your message and materials and create a custom CRM demo around the vertical to make it relevant. Do not under estimate the effort involved here.

Of the successful MS CRM resellers in the UK almost all have followed the vertical route so it does have an attraction. Vigence, however, decided not to go vertical as we have broad CRM skills and experience which cover a range of industries just as CRM is applicable to many types of business. The reason behind this decision is that we wanted to get a fuller understanding of the product and how it can be applied to various businesses and by this we get to find out what can and cannot be done. In time we might find ourselves being drawn to a vertical naturally but as far as we are concerned it is still early days for Microsoft CRM. Our customers currently fall into several verticals: Professional Services, B2B Buy-to-Sell, Logistics/Distribution, Call Centre and Manufacturing, so there is no clear pattern so far.

We did have an advantage in starting early and have been working with MS CRM now for two years. If we were taking on the product now I think the only option would be to focus around a vertical.

Microsoft too have recognised the power of verticals and reading Mary Jo Foley Microsoft are transforming themselves from a product focused company to a solutions orientated one which has implications for verticals not least marketing spend bing much more about verticals.

This can only be good, as I will elaborate elsewhere, Microsoft's marketing for CRM has been too much about Microsoft and the product - assuming you have actually seen any CRM related advertising that is - and Microsoft needs to talk about solving business problems. This is a great challenge for Microsoft and its partners and I will be watching with interest.

Your First Microsoft CRM Customer Part I

Wed, 16 Feb 2005 01:51:57 GMT

Microsoft CRM is available through the normal Microsoft channels and is sold using all the Microsoft licence types (Boxed Product, Open Business, Open Value, Select and Enterprise) thus you can buy Microsoft CRM from many different sources even on-line at Amazon.

The reason for this is that Microsoft want as many customers to get the product as possible. Microsoft have made a huge effort to get resellers engaged, trained and certified. In the UK there are around 100 companies certified in Microsoft CRM and a further 250 who are engaged. Microsoft believe that if they get the product into the channel it will sell and I can understand that view.

The resellers who have signed up to sell Microsoft CRM come from three groups; the first are the existing Microsoft resellers who in the main have sold hardware, infrastructure and related services, the second are the Business Solutions resellers Microsoft gained when they bought the Great Plains and Navision products a couple of years ago, and the third are those such as ourselves who are CRM specialists and have either never sold CRM products or who sell a variety of competing CRM products.

Microsoft CRM is a different product to its other "classic" Windows and Office products and is a different type of sale to these products. The sales cycle can be 3-6 months (our longest is 14 months!) and the decision maker is not the IT Buyer. CRM affects all parts of the business and as such is not a simple sale and requires a consultative approach.

A lot of resellers who have signed up have had great difficultly selling Microsoft CRM. Many have not closed a single sale and others may have one sale but are struggling to make their second. A handful of resellers have been a lot more successful (ourselves included I am glad to say).

In the second part of this article I will expand on a strategy for successful selling of Microsoft CRM. I warn you that this is not easy and we have invested a huge amount of time and money on Microsoft CRM over the past 18 months we are still learning!

Microsoft Dynamics CRM UK Reseller: Sales and Marketing

Vertical or not?

Your First Microsoft CRM Customer Part I