Why in business, horizontal market are called horizontal and vertical market are called veritical?

Horizontal market serves a wide range of buyers for example cars like mercidies benz, Honda civic, Toyoto corolla but in contrast vertical markets are quite focused to serve needs of specific groups of buyers like F1-Cars or race cars.

My question is why horizontal is called horizontal and vertical market are called veritical? Is there a reasoning behind it or it is just something randomly named?

Answer

A business that operates in a Horizontal Market, will by definition, have a broad and diverse set of customers.
I can’t find anything about it’s origin on web and I guess it’s just convention to call it that. A logical hypothesis could be that is based on term ‘broad’, when you serve a broad variety of customer, it make more sense to say you are scaling horizontally and when you are trying focus more on a segment of industry, you are scaling vertically.

Consider a company, for example a HR software company which sells a general HR platform for all types of businesses but it also have specialized HR platform specific to Law firms. If you put all the markets on a X-axis for visualization, whenever the company enhance Law firm’s HR platform, it can be said it is scaling vertical and when it is trying lure/market more customers regardless of there segment, it make sense to say it’s goal is to scale horizontally.

Attribution
Source : Link , Question Author : old-monk , Answer Author : old-monk

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