Industry specialization in the cloud? Maybe not.

Post image for Industry specialization in the cloud? Maybe not.

by Lilia Shirman on June 29, 2010

in Industry Specialization,Technology industry

When you are promoting something to clients because its been proven to work, its healthy to keep a lookout for exceptions.

Industry-targeted initiatives are a big theme in my work. I tend to promote specialization (of marketing, solutions, sales, etc.) as a path to B2B sales growth, a fact backed up by experience and extensive primary research.   But I’m a contrarian by nature, so I’ve been looking for situations where it just ain’t so.

I found one in the clouds.  Computing clouds.

The core value of cloud computing is that a utility model aggregates demand for computing resources across many users, creating a smoother demand curve than any single user can have alone.  Which in turn allows cloud and managed services vendors to provide the resources more efficiently, with better utilization, and (so the claim goes), greater reliability.   This concept is as old as Edison’s first electrical plant.  Supply electricity to the cable cars with strong usage in the morning, the factories that run during the day, and the homes that need power at night, and you get a uniform demand throughout the day, despite fact that each segment individually creates a peak.

That’s why, if you’re offering resources in the cloud, your value is in having a diverse and balanced customer base.  A service provider with too many retail customers, for example, is going to find themselves in a heap of trouble come November.

So how do cloud providers get a deep understanding of their customers without focusing in on target industries?  A few initial thoughts:

  1. Understanding customers’ industries is still important for defining value to customers
  2. Providers acting as utilities must pick multiple segments at once – specifically ones they have very different usage profiles
  3. If a cloud operator doesn’t have the resources to dive into multiple industries at once, it should keep to horizontal marketing and sales

This is probably the most difficult for those at the top of the cloud stack – the SaaS vendors.  Apps are less generic by definition than infrastructure and platforms.  So I’m very curious to know what strategies SaaS vendors use to keep their demand smoothed out.

Be Sociable, Share!

Previous post:

Next post: