Digital Transformation is Powering Vertical’s UC Growth

Industry veterans remember some of the big mid-market brands in the nineties like Vodavi, Comdial, Artisoft and Vertical Networks. Artisoft purchased Vertical Networks, rolled up the other very well-known brands, changed the name to just Vertical and then went completely dark for years. Any other industry would have forced the company out of business for seemingly leaving the space. Telecom is different though because there was a loyal installed base and resellers pushing these products in the market – even when the big media companies like TMC rarely if ever heard from the company.

Fast forward about a decade-and-a-half later and the company is doing very well – for reasons which make a lot of sense. We often talk about selling solutions not tech. Don’t focus on the bits and bytes we say, tell the customer how we solve their problems.

This is what Vertical does very well and they have spent a tremendous amount of time differentiating themselves. In my latest interview with company CEO Peter Bailey, I walked away thinking, boy, he really knows his stuff.

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Here is what we discussed. Digital transformation is the macro trend they are leveraging and they are making companies more efficient and offering better customer experiences. Mobile, cloud and IoT are allowing for new business models and as a result, they try to change the conversation with customers.

Throughout my career, I remember different meetings with CEOs of PBX vendors where one day they decided they wanted to gain share in one vertical market or another. They then added a few features to become more appealing to that space. I remember back in 2007 when Mitel told me they were focusing on the cruise ship market as an example. But for Mitel, this was one of many markets like Wall Street turrets the company was chasing. Their core business however always remained the generic enterprise. Ditto for just about everyone else from NEC to Iwatsu and Panasonic.

Vertical is targeting the vertical markets and doesn’t look at a big picture horizontal play the way the others do. Call any of the big business communications companies today and they will sell you the same PBX for a number of different types of businesses. This is the exact opposite of what Peter is doing.

Vertical is very strong in retail and is using the systems and processes from this space to branch out into the related hospitality, healthcare and auto dealer markets. For the latter market they can put hooks into the website where a call to call center hits the correct salesperson on the showroom floor. The salesperson can take the call directly on their mobile if they so choose.

The idea is to break down barriers and allow companies to get closer to customers.

Other solutions include drive scheduling and appointment setting integration for service businesses. The company also deploys and supports these solutions.

In CVS, the company has sensors on the ground connected to the drive-through which connects to the paging system. They allow the store to measure the amount of time from the car tripping the sensor to the time the cash register opened.

The solution combines a communications platform, notification engine, BI platform for tracking and reporting, IVR, call buttons, help buttons and instore kiosks to become a business tool.

He emphasized that retailers are in a death struggle with Amazon and they need to provide exceptional service to keep customers coming back.

Going forward, Vertical wants to have extreme relevance in  numerous verticals and continue to add value. For them it’s an execution game and they are looking to have 10-20% marketshare in the spaces they serve. He thinks the competitors using ISVs/the channel to go to market will have tougher time competing. His ultimate goal is to be known as the IBM of global services in the mid-market which is between 50 and 2,000 users. Quite ambitious to be sure but they really have found a unique way of thriving in a market where the core product, the PBX or communications server is commoditized. Yes, this really is a great approach to the market and its surprising it isn’t being replicated successfully by the others.

We can expect a cloud solution in about  a year.

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