In the days before the cloud, on-premise software providers that focused on selling into a vertical market were considered second-class citizens to the “big guns” selling into the broader horizontal marketplace. The real “win”—in market share, wallet share and ultimately, profits—was the broadest approach. The notion of specializing in solutions that serve a market niche or specific industry was considered limited unless it was just the start of something more horizontal.
However, with the advent of the SaaS model, the tables have turned. Focusing on niche verticals or specific functional areas may be one of the most successful strategies of the enterprise cloud software era.