Target Market and Customer Segments

For Who are you creating value?

• Who is The kind(s) of customer your business plans to serve? 
• Customers are the heart of any successful business model. Customers mean revenue, and without revenue, a business can't survive. Your business model needs to be built around a clear understanding of your specific customer needs. 

Your target market may be large or small. If it's too big, you will want to break it down into multiple customer segments. Your team will have to make clear decisions about which kinds of customers you're trying to serve. 

Watch out: it's tempting for passionate founders to focus on too large a target market. For instance, if your company sells shoes, you could decide that every person in the world with feet is your target market. Some products may eventually be able to appeal to the majority of the world's shoe-wearing population, for instance, Nike. However, every new business should start with a specific focus on a smaller niche within the larger market. It's impossible early on to effectively meet the needs of many different types of customers. Focusing on one or two smaller customer types allows your company the opportunity to win a smaller market before expanding to other markets. Even Nike started out creating shoes for runners; they were surprised when people began wearing their shoes for leisure. 

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