Focusing on verticals: Pros, cons and how to get started

  • Hosted Network December 17, 2021
  • Hosted Network Madeleane Abejero
  • Hosted Network 2 mins

As we get closer to a new year, realisations will probably start to pour in. What could you have done better or differently? What are the opportunities you failed to take advantage of? 

No matter what those missed chances are, it’s not too late for you to reevaluate your business strategy as an MSP. You can start with identifying your strengths and weaknesses as well as the opportunities and threats associated with the dynamic and competitive tech landscape. 

As you go through your assessment process, this important question might come up: How come we haven’t picked a niche? Some of our partners adapted vertical marketing strategies, some still chose the horizontal approach. If you’ve been pondering on whether it’s better for your MSP to focus on vertical markets or not, here’s a pros and cons list that can you help you decide:


Ability to focus all sales and marketing efforts to specific target markets for complete efficiency 

Narrowing down your focus in specific niches will allow you to create targeted sales, marketing and product strategies that will resonate better to the markets that you decided to engage with. 

Implementing content strategies that answer the pain points and needs of your target verticals will create greater impact and deeper connections with your target audience. 

Demonstrate your MSP as a niche specialist and be the go-to MSP of customers for different verticals

When you have established your MSP as an expert tech provider for distinct verticals, you can easily gain referrals from the same niche and grow your customer base. Additionally, positioning your MSP as a niche specialist will help you build strategic relationships with your customers and enable you to understand their language making it easier to identify your unique selling points and differentiate your MSP among competitors within the same verticals.

Ability to offer specialised services with higher rates due to market credibility and proficiency

When you service a particular vertical long enough, your knowledge around that vertical will be nurtured, giving you the ability to offer specialised solutions that come with higher rates and revenue for your MSP. Preparing narratives in justifying these costs would be a lot easier for your team as you already have the expertise in providing better solutions to your targeted verticals. 


Limitations in customers scope and growth potential (It’s critical to select the market that you’re going to pursue)

While there are lots of opportunities that come with pursuing targeted verticals, there are some downsides that you also need to consider. When deciding on the verticals you want to work with, you need to know the growth potential of pursuing particular markets. Customer range for each vertical varies so it’s critical that you select the ones that will match your current offerings and expertise. 

Competition (You are not the only MSP targeting specific niche, you must have solid USPs)

You also have to remember that other MSPs have already started taking the vertical approach long before you did. They might have a fair share of the vertical market that you want to pursue. So in order for your MSP to survive and thrive, you should refine your strategies and services and make sure you have competitive unique selling propositions (USP) before you go vertical.

Getting started

Research which target verticals to focus on and want to work with 

First things first. When you have finally decided to go vertical, you need to reevaluate your existing client base – which customers are typically easy to deal with (and brings in the most revenue) and to which verticals do they belong? With this step as your starting point, you will then have a good idea of the potential segments that you can focus on moving forward. 

To avoid reinventing the wheel, determine the verticals where you can offer similar services. This saves you the time and effort in starting from scratch. It’s more ideal to use or refine your current solutions to come up with niche offerings that you can sell to your chosen verticals. This will enable you to focus more on strategising in growing your customer base for each vertical market. 

Leverage on customer relationships 

An effective way to kick start your vertical market promotion is through utilising testimonials. Check if you have a group of customers which belongs to your target verticals and get testimonials from them. You can utilise these content in building credibility and promoting your brand to customers within the same verticals.

Building your new vertical customer base

It’s possible to lose some customers when you change your growth strategy but don’t turn down clients who are not in your niche unless you feel they really aren’t a good fit. 

Also, don’t be dejected when customers turn you down. Just because they aren’t a customer today doesn’t mean that can’t change down the line! Always stay in touch and keep nurturing them to promote retention and move them further along the buyer’s journey.

If you want to know our partners’ take on vertical marketing and all things MSP, you can watch one of our top-rated webinars, MSPs in Conversation: Tackling growing pains.  

Other useful blogs:

10 Ways to improve your MSP’s customer experience

Levels of MSP Operational Maturity and 4 Essential Areas to Look Into for Growth