A Vertically Integrated Approach to Digital Marketing

Vertical integration is a strategy for expanding a firm’s manufacturing and distribution role within the supply chain in a specific industry. Basically, the company owns or controls its suppliers, distributors, or retail locations in order to control its value or supply chain. Horizontal integration, on the other hand, is when a business grows by buying similar companies within their industry in the same points of the supply chain. In business, vertical integration means that a whole supply chain for the company is controlled and owned by one entity.

Controlling the distribution process is another common vertical integration strategy, meaning that companies control warehousing and shipping for company products. That’s the reasoning behind something like an SEO company in Los Angeles perhaps having a stake in another business that might have absolutely related with digital marketing.

This approach enables the SEO company to effectively target the right audience and ensure the success of marketing campaigns. It’s a savvy move to enhance return on investment and amplify the impact of the company’s messaging. A prime example of this strategy in action is utilizing an industry-specific digital marketing agency like this RX marketing agency. Such specialized agencies offer tailored services, including SEO, website design, and social media marketing, catering to the specific needs of their industry. This form of vertical integration can significantly bolster a company’s reach and ultimately lead to increased profits.

With all of this in mind, digital marketing becomes that much easier, sparking an “aha” moment particularly among those digital marketers who might be focussed on affiliate selling. The vertically integrated approach to what would otherwise be acquiring a stake, in the operations of supply-chain players like the Orlando movers you make use of, would have you partnering up with them and earning money from sales via your affiliate link.

Vertical integration can also include vertical integration in a forward direction, stretching a company’s production control horizon further into the end of the supply chain. An example, rather than vertical integration, but within a digital world, highlighted by whole-of-supply-chain, is Google’s ability to integrate from the top-down (in this case, top-down starting with customers, which becomes a raw data-source) through to the bottom-up. This kind of integration reduces the costs of doing business across the supply chain for a business, and it also inherently manages operations from beginning to end.

In many cases, the primary goal of vertical integration is to eliminate, or at least significantly reduce, the costs of purchasing and selling that arise when individual companies own the two stages of production, and possibly even physical transportation costs. For businesses with a smaller market share, the degree of front-end integration seems not to matter; for businesses with larger share, operating as part of a vertically integrated firm helps with profitability. As I mentioned, larger businesses should more frequently be able to employ vertical integration strategies than smaller competitors, since larger companies are likely to be able to run on an effective scale in every phase of the activity.

Some argue that, generally, businesses and companies that are vertically integrated, particularly backwards, are better equipped for innovation because they engage in a lot of production and distribution activities where changes can happen. So the only way you could get involved with a wide variety of types of businesses is through digital marketing (affiliate sales). Your expertise might otherwise not have you technically equipped to partner up with the likes of the businesses featured at Healthleadersmedia.com, for instance.



Meredith Weisser

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