# Verticals _Strategic discipline in vertical markets: positioning, sequencing, and the choices that matter._ --- Vertical markets demand a different playbook. In horizontal software you can spray and pray, cast wide, iterate fast, let market pull tell you where to focus. The addressable market is enormous. You can afford to waste effort finding product-market fit. Vertical is the opposite. The total addressable market is fixed. You're selling ERP to dentists, or workforce management to care homes, or compliance software to wealth managers. The category is defined. Everyone knows who else is playing. You can't out-spend competitors to grab share. You can't pivot to a new vertical when this one gets hard. You need to win through positioning, sequencing, and discipline. Most vertical software companies get this wrong. They copy horizontal playbooks, chase every prospect, add features for anyone who asks, compete on price when differentiation feels hard. Then they wonder why growth stalls and margins compress. --- [[Real choices]] applies the flip test: if the opposite of your choice could also be rational, you've made a genuine decision. In vertical software the boundaries that matter are more specific than the industry label. You might serve healthcare, but the real choices live in the specifics: enterprise hospital groups or long-tail GP practices? Core clinical system or compliance layer? NHS trusts in England or private hospitals across Europe? Each choice has a rational opposite, and both sides work with different economics. Once you've drawn the field, decide how you'll win on it. Lowest cost or distinctive value. Straddling the middle fails. In vertical markets, advantage lives in small, compounding details: regulatory nuances handled cleanly, workflows that reduce risk, integrations that remove headaches. The strength comes from a system of reinforcing activities, not a single feature, which is what Hamilton Helmer would call [[Switching costs]] built through depth. --- In most vertical markets the software offer is well defined. Everyone has a version of the same modules, the same dashboards, the same pitch about saving time and money. You can't escape the category, but you can control the frame. There is a useful split between consideration attributes and retention attributes. Consideration attributes are what sway the buyer at the point of choice: risk, compliance, margin, reputation. These are what get you shortlisted and win the RFP. Retention attributes, usability, reliability, support, keep users content after go-live. Both matter, but they work on different timescales. Lead with consideration, not retention. A beautiful interface rarely decides the initial sale, because buyers are often not the daily users. They're asking: does this reduce our risk? Does it protect our margin? Does it help us comply? That choice of frame has to be grounded in what you can credibly claim. If your strength is auditability, the natural frame is assurance: you're not selling "construction management software" but "the system that keeps you audit-ready when the regulator arrives." If it's scheduling and visibility, the frame is margin and throughput. If it's workflows that shape the service delivered, the frame is outcomes. The underlying product may look similar to the competition, but the frame shifts how it's judged. --- Even in small verticals, spray-and-pray kills momentum. The right move is depth before breadth. Start with an Ideal Customer Profile that's narrower than feels comfortable. When you're the obvious choice for a specific, reachable group, sales cycles shorten (prospects have heard of you), product development focuses (you're building deep domain fit for one segment), and customer success improves (onboarding gets repeatable, advocacy grows). Expansion should follow a logic. Each new segment should share 70-80% with what you've already won: buyer persona, regulatory environment, scale, geography, use case. Pick one or two to vary, not all of them. This lets you reuse case studies, refine the same core product, and leverage existing partnerships. [[Veeva]] didn't start by serving all of life sciences. They focused on large pharma sales and marketing, became the standard, then expanded to clinical, then quality, then smaller biotech firms. Depth before breadth, applied over years. --- Pricing is one of the clearest signals you send about where you play and how you win. If you've chosen cost leadership, pricing should reflect that: transparent, simple, lowest in category. If you've chosen distinctive value, pricing should reflect that too: premium, tied to outcomes. Pricing that contradicts your strategy kills momentum. You say you compete on differentiation, but your pricing is mid-market commodity. Buyers notice. If you're the new entrant, you might price lower to get in the door, classic [[Counter-positioning]]. But the goal should be to climb the pricing ladder as you build proof. Treating pricing as a core discipline forces clarity: what do we believe customers will pay, and why? Handled well, pricing protects margin and sharpens strategy. Handled casually, it undermines both. --- **Case studies:** [[Jack Henry]] · [[Tyler Technologies]] · [[Veeva]] - See [[Vertical software]] for the full collection.