For whom is this blog:
For software development companies that struggle with their market positioning and researching specialisation benchmarks
For service companies that look for more efficient methods to generate new business
Table of content:
Future Processing: software development outsourcing for UK-based companies and healthcare vertical
What to know about "finding a specialisation and niche marketing" before reading this article:
Niche marketing in software development can be a powerful strategy for businesses of all sizes. It allows companies to specialise in specific areas, provide value-added services, and increase profit margins.
This article will examine how small and large custom software development companies have been building their strategies to niche and focus on developing specialised verticals.
By niching down and getting specialised, business owners can better meet the unique needs of their customers while also increasing customer loyalty and retention. Companies can maximise their profits and significantly impact the industry through this approach. Let's explore how businesses of all sizes have found a niche in software development that resulted in their communication.
If you're interested in learning more about niche marketing and its importance, I highly recommend checking out my previous articles:
In those articles, I delve into niche marketing and why it is crucial for businesses, especially in the software development industry. Additionally, I outline five compelling reasons to build a niche in your software development business, highlighting the benefits it can bring.
And finally, I provide a comprehensive framework and guide on how to build niche marketing strategies that can help you offer value-added services to your clients. By implementing these strategies, you can differentiate yourself from competitors and attract a targeted audience that genuinely values your expertise.
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Want to differentiate your business and sell more?
We will help you stand out from the crowd and get more clients by niching down and implementing digital marketing strategies.
To access these valuable resources and dive deeper into the world of niche marketing, be sure to read my previous articles. They will equip you with the knowledge and insights needed to excel in your software development business and understand why companies presented in this article always search for better positioning and new niches. Happy reading!
The Evolution of Specialisation in the Software Development Industry
Specialisation has become the norm rather than the exception in today's fast-paced digital world. A deep dive into the journeys of industry leaders and high-performing small enterprises reveals a typical trajectory - the natural inclination towards building specialisations over time.
The pace of this evolution has varied. Companies that began operations in the 1990s or early 2000s took longer to carve out their niche in a form perceived as a niche today. Limited competition, fewer projects, a lower need for digitalisation, and being part of the software development industry were considered a niche.
These companies have since built solid foundations and positioned themselves on what are now perceived as general keywords such as 'custom software development', 'bespoke software programming', and others. However, for new entrants to the market, competing against these giants on popular phrases is a challenge.
Newer companies wanting to gain visibility, attract clients beyond referrals and take control of their growth trajectory face two options. They can either invest heavily to compete with established software development firms or differentiate by finding their unique niche.
Thus, it's hardly surprising that younger software development companies actively build their specialisation early on. The dynamic landscape of the software development business demands constant adaptation and a finger kept firmly on the pulse of the industry.
Take, for example, blockchain development. Ten years ago, it was a narrow niche. Today, declaring it your specialisation invites the follow-up question, "What do you do in the blockchain area?"
In this article, I will share the stories of custom software development companies and their journey to specialisation thanks to the invaluable resource, the 'Internet archive'.
So let's begin this exploration according to the time sequence of their evolution...
Specialisation and search for niches among big and established software development companies
SoftServe: A Pioneering Software Development Company
Founded in 1993 in Lviv, Ukraine, SoftServe has grown to become a global leader in software development and consultancy services. What started as a small, local endeavour has transformed into a multinational corporation. This year (2024), Softserve celebrates 30 years in business, with over 10 000 people on board in 33 countries.
It's an excellent opportunity to look at how the current giant has evolved and changed their communication over time.
On April 30, 1993, The World Wide Web was released to the public. The dot com bubble increased in the late '90s and burst in the early '00. Those were the early stages of the software industry's growth. SoftServe was already in the market building websites, the first e-commerce. At that time, being a part of the software development industry was a niche.
The first iPhone was released in 2007, and the first Android available on the HTC Dream phone was in 2008. On the screen from 2011, you can see that the company followed the market and was there in the very first years of the popularity of mobile apps and SaaS solutions.
As the market evolved, so did SoftServe. It built solid foundations and positioned itself as a key player in the market, specialising in consultancy services and software development.
A screenshot from 2013 shows that the company communicated the very first vertical specialisation. It was healthcare.
In the following years, the company directed their offer to the decision-makers who digitalised their businesses or created new financial services, retail or media solutions.
On the most current website of the company, you can spot many more industries being addressed on dedicated pillar pages, blog categories and directed PPC campaigns.
Softserve's insights on finding a niche and building a specialisation
We have met with SoftServe team Yulia Kryval, Head of Digital & MarTech, Global Marketing and Oleksandr Yavlinsky, Associate Director, Retail & Supply Chain Practice Lead, Product Management & Business Analysis CoE to learn more about their approach to building specialisation and its impact on the business:
Marcin Małaszuk: Is it necessary, and if so, why, for a global company with an established position to build vertical specialisations?
Yulia Kryval: Working with customers from different industries, we realized it’s more important to understand the niche-specific challenges and pain points. For example, AI-based solution in healthcare is not the same as an AI-based solution in manufacturing sector. By creating industry specific offers and thus content, it is easier to show our potential customer we aren’t just trying to sell all the services we have – but we are speaking their language, we know their environment and we can provide real use cases to meet their specific needs. Industry-specific knowledge is not easily acquired or pursued. Instead, it comes from continuous work with customers day in and day out, seeing their context from within and building solutions that often come with deep understanding of end customer, regulatory processes and data specifics. From a marketing standpoint, packaging same or similar service offers for different business domains enables you to go more granular, seem less superficial and deliver way more relatable content to the audience. Industrial segmentation distances from “spray and pray” approach; it gives you the flexibility to tailor seemingly generic offer into something on-point and makes you realize you don’t have to explain the obvious (like what visual inspection and corrosion detection is to a professional from energy sector). This way you can get straight to the point: not educate – because they are the specialists – but show how SoftServe can help businesses deal with their problems. We want our potential or existing customers to interact with our content and inherently feel “these guys know what makes me awake at night.”
MM: Is building specialization in large organizations with significant resources easy?
Oleksandr Yavlinsky: Building a new practice in a large resourceful organization is always like a double-edged sword. On one hand, there’s a solid foundation to build upon, in terms of structure, talent, clients, etc. At the same time, new practice means a new way of doing things, of doing business essentially, and there’s a whole lot of organizational, educational, and change management to it. There are three key points contributing to the success of such an endeavor:
1. Organizational maturity: There needs to be a pre-requisite for innovation and change within the organization. And it takes a certain amount of time for a software vendor, especially a very successful one, like SoftServe, to start a journey beyond its comfort zone, which is providing our clients with state-of-the-art custom engineering solutions. In our case, it was an irresistible motivation to create more value for our customers, multiplied by our customers’ actual interest in these specific solutions, which are tailored to their industry needs.
2. Leadership buy-in: Unlike your current business-as-usual operations, establishing a new approach will be full of trials, pivots, and learnings. Therefore, it’s important to have leaders in the company being aligned and engaged with this approach. In our case, Ioana Pona, our Director for Product Management & Business Analysis Center of Excellence, was and is an absolute visionary and spearhead in championing the creation and development of multiple industry-focused practices, including supply chain, retail, manufacturing, financial services, energy, and others.
3. Hiring the right talent: When ramping up, you’ll need to find the right people to build the foundation of the practice. From my experience, there’s a need to acquire both experienced industry individuals, but also open-minded ones, who are excited about the challenge of building something new. At an early stage, there will be a need for a couple of individuals to wear multiple hats in their roles, so this needs to be factored in.
The story of SoftServe is a testament to the power of specialisation and innovation in the ever-evolving landscape of software development. It might serve as an inspiration for new entrants in the market and a benchmark for established companies.
Future Processing: software development outsourcing for UK-based companies and Healthcare vertical
Future Processing, a software development company, was founded in 2000 in Poland.
Today, it boasts a strong team of over 1000 professionals who deliver end-to-end services, from vision to reality. They are technology consultants and software delivery partners known for their expertise in solving business problems using technology.
The company has been providing software development solutions for 23 years. They have delivered hundreds of software products for startups, SMEs and corporates, including Fortune 500 listing.
The company linked their success to a people-first approach. This philosophy has helped them solve business problems using technology for over two decades, establishing them as experts in software development and, without a doubt, business consultancy as well. That's what Future Processing communicates as the Future Processing Way. From their early days, this is crystal clear. Let's have a look.
Between 2007 - 2011, the company communicated and positioned itself as a go-to outsourcing service for companies in the UK market. The value proposition presented was about time-saving, estimated to be around 50% of the UK rate. Another factor of specialisation was technology.
The geographical focus on the UK communicated in the very first years of Future Porcessing remains till today. According to Future Processing sales presentation the structure of company's clients are as follows (in 2022):
51% the United Kingdom
22% the USA
9% DACH region
9% other European countries.
6% Poland
3% Asia & Middle East
The structure of Future Processing clients reflects what was the main point of communication of the Company. That was nearshoring.
As of 2017 the company build a go-to portal for insights on nearshore IT outsourcing, full of expert articles, videos, checklists and many more.
In 2016 Future Processing communicated a much broader scope of services and solutions. The site map in the footer is one of the best ways to understand the structure of a company's services.
While the technology or platform specialisation were leading in the earlier years, the Future Processing quite quickly spotted domain know-how as a market advantage. That was a mix of emerging technologies like blockchain, and AI with a 'traditional' tech stack supported Healthcare business.
Future Processing maintained communication about medical software solutions, both on the dedicated brand Future Healthcare (that is no longer maintained) and on Future Processing corporate website.
The focus on delivering value-added services to selected client segments resulted in the commencing of a new company, Future Processing Healthcare sp. z o.o., with a brand Graylight Imaging.
After all, Graylight Imaging is dedicated to medical clients. The company specialise in the area of medical image analysis and ML algorithms for both medical image and computer vision analysis. You can read how narrow specialistation the company have in this case study: https://graylight-imaging.com/project/automatic-brain-tumor-segmentation-with-subregions/
From the company's journey, we can assume that industry specialisation brings more value to the clients and allows a changed positioning.
Comming back to Future Processing, today, we can notice that the process of building specialisation that was commenced in Healthcare and Medicine is being mastered and expanded into other business sectors like:
Insurance
Financial Services
Automotive
Transport
Etc.
Anna Choma, Communication manager in Future Processing and Graylight Imaging on specialisation.
We have asked Anna Choma, the Communication Manager in both Graylight Imaging and Future Processing, for more insights about their specialsation.
Marcin Małaszuk: What caused Future Processing to identify healthcare and medicine-related solutions as one of the first and main specializations?
Anna Choma: Future Processing has worked with over 200 global clients to solve business problems and digitally transform their businesses over the course of its 23-year history. The company entered the medical industry in order to actively participate in the transformation and foster innovation in an industry where technology has a direct impact on human life and health. Recognizing the direct link between technology, its ability to automate processes and analyze massive amounts of data, and some medical procedures (particularly those involving the analysis of medical images) the company saw an opportunity to use its expertise to drive positive change and progress in the medical domain. However, it does not mean that for FP medicine-related area is the first and main specialization.
MM: What does building specialization in an organization mean in practice beyond communication and marketing?
Anna Choma: Building specialization is not only about communication and marketing. It entails gaining expertise and focusing on specific areas or functions to improve overall efficiency, effectiveness, and innovation. Specialization can lead to better utilization of resources, increased quality, and a competitive advantage, but requires a great amount of domain knowledge, spread properly through the whole organization. The first thing that needs to be addressed is operational efficiency. Each specialized team must be able focus on their core tasks, so the organization would be capable of smoothing workflows and reducing duplication of efforts. It is particulary essential if the area of the market you operate on requires research and development (R&D) activities, and that is the case in the medical industry. RnD teams should be able to dedicate their efforts to in-depth research, experimentation, and development of new technologies or products. The role of the organization is to free up their time and create innovation-friendly processes. Additionally establishing specialization often relates to quality control and standards assurance. In healthcare software development testing, inspection, and continuous improvement in accordance with ISO 13485 or IEC 62304 is something that must be happening on an everyday basis. Obviously to do all of that the organization is supposed to have specialized human resources strategy to attract and nurture the right talents, people with specialized skill sets and mind sets. It is important to remember that each organization has its own culture that needs to be taken care of. In the area of medical software and algorithms development an organizational culture must reflect values and attitudes, often different than in a regular software house. And above all this, it is also necessary to build a network of contacts, medical partners, scientific partners, own brand and ... its recognition. To do this, you need to do your homework, devote a lot of time and effort to understand the rules governing the market we are interested in.
MM: Why did you establish a dedicated brand, Future Healthcare?
Anna Choma: Because different groups of consumers have different preferences, needs, and perceptions, it is common knowledge that by creating a separate brand, a company can tailor its products or services, messaging, and image to resonate more effectively with each segment. Furthermore, certain industries, including the medical industry, have strict regulations, and having separate brands can help comply with these rules more effectively. The formation of a subsidiary company (Future Processing Healthcare sp. z o.o.) and the dedicated brand "Graylight Imaging" enabled FP to strategically manage offerings, resonate with specific audiences, innovate freely, and maintain control over its brand reputation in a variety of markets and industries.
Stay tuned to Future Processing and Graylight Imaging communication changes as they are trendsetters, and other software development firms follow the tactics they apply.
Netguru: how to find niches and become the guru of software development
Netguru is a prominent software development and consultancy company from Poznań, Poland. Founded in 2008, Netguru has established itself as a leading player in the tech industry, operating globally while maintaining strong roots in its home country. The company in their portfolio presents brands like UBS, Volksvagen, Merck, OLX, Ikea and others. Netguru is recognisable among UK and US startups due to their marketing activities, opinion in the industry and events they organise.
As a digital acceleration company, Netguru's services are multifaceted. They offer product development, create software solutions, and provide UX/UI design services for startups and enterprises. Their enterprise software development team is known for delivering secure and reliable enterprise-grade software.
Netguru takes pride in building custom digital products that reshape how people do things. Their custom software development team works tirelessly to deliver delightful user experiences. In addition to its software development services, Netguru also provides consulting services in product development and product design.
The screenshot from 2012 reveals Netguru's initial focus on tech outsourcing, custom software development and web development based on Ruby technology, one of the leading technologies for startups then.
Moving forward, after Netguru's rebranding, they became the 'green' ones. They focused on selected markets: the US, the UK, Germany, Ireland, Finland and quite surprisingly Caribbean.
The first time Netguru introduced communication to particular industries was in late 2020. The 'Industries’ pillar page landed on the corporate website then. You could find the following vertical niches: Fintech, Healthcare, Retail, Greentech and Education.
Marketing campaigns follow the change in communication. To name a few, there are publications and e-books related to the industries.
And physical events and venues dedicated to the topic.
With no hesitation, Netguru is very active in delivering more and more value to clients and building its presence worldwide by systematically strengthening its visibility in its niches, if they are vertical niches, technological specialisation or geographical focus.
Specialisation AND NICHES among smaller SOFTWARE DEVELOPMENT companies
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Want to differentiate your business and sell more?
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To address the argument, 'ok, that's great examples, but we are not SoftServe nor Netguru. Those niche-building strategies do not apply to my smaller business."
Let's have a look at smaller companies now.
LEOCODE: just like lions, fast and agile in communication
LEOCODE is a software development company based in Katowice, Poland. They have made a name for themselves as providers of advanced software solutions, employing domain-driven design to comprehend business needs and apply the most appropriate solutions fully.
The company has undergone a significant transformation over the years. Recognising the changing tech industry landscape, LEOCODE strategically shifted its business model towards consulting. This move reflected the evolving market trends and indicated LEOCODE's adaptability and forward-thinking approach.
A company's claim pictures the approach 'Think first, code later", further explained with the statement "1 hour of (reasonable) planning > 100 hours of coding". I find it brilliant.
Today LEOCODE the company employs more than 60 software developers.
Let's see if and how the Lions are building their specialisation.
The first snapshot captured by Internet Archives from 2018 presents LEOCODE as a company communicating outsourcing companies to a broad tech market.
But in the very first communication, signals were sent to the audience that LEOCODE might address particular areas of their business needs.
In the case of LEOCODE, the awareness of the need to find a specialisation and communicate happened very fast.
In 2019, the company rolled out dedicated to Commerce, Mertech, Enterprise Blockchain, AI-powered BOTs and Enterprise New Ventures pillar pages. Each focused on the target audience's needs and ideal clients' profiles.
In 2021 the Services and Expertise list became more extended. That's the simple indicator that building specialisations was proved on the battleground.
As you can see on the screen above, the company worked out strategic methodologies and defined not only target markets and industries but also Ideal Client Profile and Buyer Persona Profiles. On top of that, they have taken steps to address their needs and problems.
The sub-page dedicated to CTOs and their problems is a tactic to generate leads for Lions.
Today's communication shape allows decision-makers who visit the LEOCODE website to navigate quickly to the subpages where they find information crafted for them.
An exciting way of presenting the specialisation is Leocoin - a cryptocurrency launched by the Lions. For sure, it gives a flavour of professionalism in the blockchain business.
Damian Winkowski from Leocode on Specialisation
We have asked Damian Winkowski, CEO and Founder of Leocode, what caused him to start communicating with selected industries at Leocode? How did it impact the business development?
Damian Winkowski: Most of the industries we picked (like Insurance and Fintech) and solutions we applied (web3, chatbots and currently AI) come from our clients. We started projects with selected people (mainly by recommendations) and we've built expertise on top of that. Having good clients who have a need to innovate allowed us to create new service lines and solutions. It wasn't picked by engineering. It was the opposite. We met interesting people with technical challenges. We solved those challenges and we dived into it. Based on the delivered product and our satisfaction, we decided to continue delivering further software development services and solutions in those areas.
The example of LEOCODE shows that they have started with communication to the general audience. They have narrowed and mastered communication to selected verticals and niches to scale the specialisations among the next industries within the learning process and resources and capabilities growth.
Big up, LEOCODE!
Nextrope: born as a specialised blockchain development company
Nextrope is a software development company based in Gdynia, Poland. Founded in 2017, the company quickly emerged as a Web3 and Blockchain Custom Software Development leader. This is an example of a specialised company as of its very first days.
With around 30 strong team of expert software developers, Nextrope specialises in web3, blockchain and fintech projects. They provide full-scope software development services, from technology consulting to front-end and back-end development.
When you go to the company's Clutch profile or Case Study section, you will notice that projects out of the blockchain and web3 industry are in the minority.
Nextrope has developed a reputation for practical blockchain, tokenization and decentralised apps (dApps). Their dedicated focus on blockchain technology led them to create a launchpad tokenisation platform.
When you dig into the history of their website, you will spot that despite the sole focus on web3 projects, Nextrope's communication has evolved. Today you have no questions when landing on Nextrope's website about where you are and what kind of value and projects they would deliver.
The Nextrope is very active in content marketing, events and public speaking gigs where they teach about blockchain and, recently, AI.
Summarising, Nextrope constantly works on its messaging and precise communication with its target audience.
Serial Entrepreneur and Founder of Nextrope, Mateusz Mach, answers questions about their sharp focus on the niche.
Mateusz Mach is a Polish entrepreneur and investor. Founder of the world's first sign language messenger Five App and software house Nextrope. He was a finalist of the ranking of the most influential European entrepreneurs under the age of thirty, Forbes 30 Under 30. He wrote a book that I personally recommend, 'Świat Kryptomilioenrów' (eng. World of Crypto Millionaires).
Marcin Małaszuk: Why did you choose a narrow specialization in the market instead of broadly directing your communication? Is it the right decision after 7 years of running the business?
Mateusz Mach: In the early days of the blockchain and cryptocurrency industry, it was a rapidly evolving and highly complex space. I recognized that by narrowing our specialization to tokenisation, we could become experts in a specific area, rather than attempting to cover everything, which was simply not feasible at the time. By focusing on a niche within the market, we could offer tailored solutions and deep expertise to our clients.
Today, I can firmly say that it was the right decision. Our narrow specialization allowed us to build a reputation as pioneers and experts first for tokenised assets and later for a complex blockchain R&D projects. We established ourselves as one of the very first companies in the space, and this reputation has been instrumental in attracting clients and partners who seek our specialized knowledge and services.
Marcin Małaszuk: In what way has building specialization influenced the development of your company?
Mateusz Mach: First, it allowed our team to create a deep reservoir of knowledge and expertise in blockchain development. This, in turn, helped us develop innovative in-house solutions and provide unparalleled value to our clients. By concentrating our efforts, we were able to stay ahead of industry trends and emerging technologies, ensuring that our clients received cutting-edge solutions tailored to their needs. Specialization also enabled us to foster strong relationships within our niche market. We became a trusted partner for businesses and organizations seeking blockchain solutions in that specific area. This resulted in long-term partnerships, repeat business, and referrals, all of which have contributed significantly to our growth and success.
Marcin Małaszuk: Is building specialization an appropriate strategy for companies in the early stage of development? Why?
Mateusz Mach: In my experience, specializing early in a focused niche can be a powerful strategy for startups. It allows for: Expertise: Becoming an authority in a specific area, particularly in a dynamic field like blockchain. Efficiency: Efficient resource allocation and deep understanding of the chosen domain, resulting in superior products or services. Reputation: Building a strong reputation within a niche market, leading to brand recognition, client trust, and growth opportunities. Adaptability: Swift adaptation to changes within the niche, maintaining a competitive edge.
Ulam Labs: From General Purpose Software House to a Highly Specialised Software Agency
Ulam Labs is a software development company headquartered in Wrocław, Poland, counting over 60 developers in the team. They were founded on the principles of mathematical precision and technological innovation of Stanisłw Ulam. They have made a name for themselves as a trusted blockchain custom software solutions partner.
The company specialises in Fintech & Blockchain products, helping businesses grow and innovate in an increasingly digital landscape. Their portfolio includes web and mobile applications deployed in the cloud to ensure optimal performance and accessibility.
Ulam Labs' commitment to quality is evident in their work culture. They strive for exceptional quality in every project they undertake, building future-proof software and designing slick user experiences. This pursuit of excellence has garnered positive reviews from its clients, with many praising its reliability and expertise.
When you visit Ulam Labs' website, you know what they are for. It's 100% about Fintech and Blockchain. But it was not always like that.
When the company was founded in 2016, the company breathed and lived Python. They positioned themselves as experts in Python and JavaScript development.
The focus of communication was on Mobile Development, SaaS Development and Custom Software Development using selected and tested technologies.
In 2021 Ulam Labs started communicating with particular industries and market verticals.
The main focus was set already at that time…
…however, communication to the Telco industry was visible.
By communication on the website, their blog and clients' portfolio structure, Ulam Labs differs from the company in 2016 and 2018. Today this highly specialised company builds its presence in a structured by themselves way.
The time between the company starting its first steps to find its niche and build vertical specialisation to create its current image was incomparably shorter than in the case of its older and bigger counterparts like Future Processing or Softserve.
Summary of best practices of niche building and specialisation crafting
The software development landscape is undergoing a significant transformation, primarily driven by emerging technologies that came and passed over time. These next-gen technologies are integral components in businesses across various sectors.
While these technological advancements are crucial, software development companies are shifting their focus beyond just the tech. Today, the objective is to provide value-added services that offer more than technological solutions. Companies actively seek ways to increase margins by carving out market niches and industry specialisations within their organisations. This trend is visible across all types of software development companies - from small startups to large established firms.
Companies need to stay updated with the latest technological trends and market changes in this dynamic environment. While it may take time to realise, even the most well-established companies are putting considerable effort into building their niche-based presence. The ability to communicate the business advantages of these niches, rather than just the technological ones, has become increasingly important. It is an active approach to build value-added services and increasing margins.
I want to find my niche. What to do next:
I have published a guide with a step-by-step process that will help you brainstorm opportunities and figure out a specialisation for your software development company. Once you follow that, you will see that building a marketing and sales strategy will be much easier. So stay tuned or sign up for a newsletter to get that article first.
Or, if you want to do it quicker, book a meeting with me and let’s discuss opportunities for cooperation.
🚀🚀🚀 👇👇👇 🚀🚀🚀
Want to differentiate your business and sell more?
We will help you stand out from the crowd and get more clients by niching down and implementing digital marketing strategies.
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