Written by: MVP Workshop

How to Define a Niche Target Market for Your MVP?

It can be tempting to dive head-first into the largest market you can find, armed with a Minimum Viable Product (MVP) and seeing how things go. However, tackling a big market right away is not always a wise idea. In fact, aiming too high too fast can cause you to stretch your resources thinly and become overwhelmed.

On the other hand, getting your start in a small – or ‘niche’ – market is almost always a solid business plan. Targeting a smaller customer base will enable you to pivot your product faster should the need arise, scale it seamlessly, and get the opportunity to engage with your users on a regular basis. From a business standpoint, defining your niche market is definitely a smart plan.

In this article, we’ll take a closer look at the benefits of defining your niche market and then we’ll guide you through the process of doing so in three simple steps. Time is money, so let’s get started!

The Benefits of Niche Target Markets

We already touched upon some of the benefits of targeting a niche market, but each of them is important enough to warrant a good explanation. The best thing is, these pros should hold up regardless of the focus of your MVP. Let’s check them out:

  1. Improved focus. Targeting a smaller market enables you to get to know your users better and adjust your MVP to their needs. This should enable you to build a killer product with laser focus, instead of targeting a giant subset of users and trying to cater to all their needs.
  2. Faster scaling. Scaling is likely to be less of an issue when you target a niche market. Opening your MVP to a smaller group of people is a safer bet because it enables you to adjust your business as it grows. Furthermore, you can always decide when (and if) to roll out to new markets and make sure you’re ready for the influx of new users.
  3. Improved maneuverability. Making large changes can be a nightmare when you’ve got too large an audience for more users usually require more testing. However, if you target a niche market with your MVP, pivoting becomes much simpler. As long as you pay attention to user feedback, any changes you make should be well-received.

Now that we’ve (hopefully) sold you on the idea of testing the waters for your MPV with a niche market, let’s talk about how to define yours.

How to Define a Niche Target Market for Your MVP (In 4 Steps)

Defining the target for your MVP is a complex procedure. It’s not as simple as considering which users would benefit the most from it (although that’s a huge part of it), and deciding whether to focus on businesses or individuals. We’re going to tackle this process in three steps, starting with identifying your customer base.

Step #1: Identify Your Consumer Base

Your consumer base is the core users who identify most closely with what your product stands for, and they are the ones that should reap the most benefits from its features. Identifying this subset of users is critical to the success of any MVP since their needs are what should drive its development forward.

The more specific your user base, the more niche your target market will be as a result, which means you’ll get to enjoy all the benefits we discussed earlier. To identify your customer base, you’ll need to get into the heads of your ideal users. You can do this by asking yourself the following four questions:

  1. What kind of user comes to mind when you think about your company’s culture and the products you’re offering?
  2. Who’s more likely to benefit from the features that your MVP offers?
  3. How do these users benefit from your product?
  4. Can you think of any potential users that wouldn’t fit into the description you crafted over the past three questions? If so, why are they interested in your product?

Once you have a type of user in mind, you need to start thinking like them. Return to questions number two and three, then break down each benefit and how your product can help solve them. That information will be key to developing your MVP over the long term, but for now, focus on filling in the blanks about your potential customers.

With the information above, you should be able to create a rough profile of your consumer base including their level of education, socioeconomic status, general interests, etc. The more details the better, since it will help you target your niche market more effectively.

Step #2: Think Smaller

Even if you started off with a small customer base in mind, chances are you can always narrow down your target market a bit more. As we mentioned earlier, going too big too fast can lead to your resources getting stretched, and it means you’ll have less room to maneuver. That’s what makes launching your MVP within a niche target market a great decision in almost every single instance.

Consider Facebook, for example. Nowadays, it’s almost impossible to meet someone that doesn’t know or use the platform on a regular basis. Their own launch started with an exceedingly small niche target market: Harvard students. Focusing on a small market enabled them to test each new feature on their MVP thoroughly before rolling it out to new ones – one campus at a time.

One important consideration when it comes to defining your niche target market is to think as small as possible. If for example, you’re considering launching a service to create and ship tailored clothing for men, you’d be going about it the wrong way if you defined your target as “adult males”. The right way to go about it would be to consider the budget of your ideal users, what type of clothing they like, what fashions are en vogue in their locations, and so on and on.

In this particular case, a good example of a niche target market would be “men with weight problems between 25–40 years of age earning above $40,000 per year”. Knowing all this information about your customer base would enable you to design styles for men with specific body types, choose the perfect materials for their budget, and consider which styles to promote.

“Smaller is better” is not a phrase that you hear often, but when it comes to MVPs, starting out modestly is almost always the better decision from a business standpoint.

Step #3: Test Your Niche

Now that you’ve determined who your ideal customers are and landed on a niche that fits their profile, it’s time to test your assumptions.

To do this, you’ll need to run a limited market test. This type of exercise is designed to gather feedback from small, targeted groups of individuals before presenting your product to the masses. At this stage, your product should already be working – which is a simple way of saying it should be minimally viable. A limited market test will help you spot any glaring flaws that could cripple its launch, and tell you if you need to pivot before popping the champagne bottle.

Furthermore, this exercise presents a perfect opportunity to double-check whether you did a good job of identifying your customer base during step number one. If your MVP’s feedback is overwhelmingly negative, chances are that you chose to focus on the wrong features, or incorrectly identified the needs of your users. Naturally, neither of these issues is desirable, but if you catch them early enough, there’s nothing stopping you from regaining your footing.

On top of a limited market test, there are other ways to go about confirming your niche target market. You can always conduct focus groups, hold one-on-one interviews, send out surveys to current users, and execute A/B tests for new features. Which approach to use will depend heavily on your MVP, but if you’re looking for structure, here’s a five-step course on how to test yours.


Trying to tackle a giant market from the start can hurt the chances of success for your MVP. It can lead to you stretching your resources too thin, becoming overwhelmed, and being unable to pivot in case large problems arise. All in all, testing your product in a smaller market is almost always the better approach.

The key to defining the perfect target niche market for your MVP is to follow these three steps:

  1. Identify your customer base and their needs.
  2. Think small when it comes to your niche.
  3. Test your niche market.

Do you have any tips on how to identify your consumer base? Let us know in the comments section below!

Image Credit: Pixabay

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