A playbook for Generating Business Ideas

How to Choose a Customer Segment
Below is some advice on selecting a customer segment you want to serve.
Per above, it’s often highly effective to first start with a customer segment you
want to serve. Here are a few things to think about when evaluating which
segment to serve:
a. Relationships and Access
If you have existing relationships, or at least easy access to your customers,
finding people for customer development interviews will be a lot easier. When
the time is right, customer acquisition will also be a lot easier. If you don’t have
access to the customer segment you want to serve, starting and building your
business will take longer because you’re going to have to get access first.
b. Passion
As discussed above, the more you enjoy spending time with your customer
segment, the more enjoyment your business will be. I also believe having more
passion for what you’re doing will make you more successful.
c. Propensity to Buy
Some customer segments are less likely to adopt new technologies than others.
In a business to business situation, some industries are more likely than others to
adopt new technologies. Some customer segments have greater budgets than

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others. Some customer segments take longer to decide and actually purchase
than others, which can mean longer sales cycles.
d. Market Size
If your goal is to build a massive company, you’ll want to be in a large market.
Consider what your growth goals are to help decide which customer segment to
serve. Serving a very niche customer segment might not lead to as large of a
business as serving a large customer segment. Examples of large customer
segments include small businesses, college students, and parents. Examples of
small customer segments include people who own yachts, convenience store
owners in a particular town or small suburb, and 100+ year-old men.

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