A 2 minute read by

In this episode of Ask Codelation, we answer the question “Is my target market too small?”

I’ll challenge you right off the bat by saying that if you don’t think your target market is too small, it’s actually probably too big. You want a market that is approachable, meaning a market that allows you to get in front of as many real people as you possibly can.

So let’s say that your original target market is 25 to 35-year-old men that are into the outdoors. How many of those are across the U.S.? How are you going to reach them? Do you know enough of them? If you’re targeting a product that retails for, let’s say, $10 a month and you want to grow this to into a million dollar business, quick math says that you need to serve a lot of customers to be able to hit that.

One million dollars a year is about $86,000 a month, so you need 8,600 paying customers every single month to get to a one million dollar business.

Now let’s take it the other direction. Let’s say that you have a more niche product and you can charge a premium because there aren’t as many people in that market satisfying that need.

Let’s say you could charge a hundred dollars for that product. That would make your number of buyers required to earn one million dollars way, way lower. Now you may be thinking to yourself, “Well that’s great, I can get to a million dollars, but what happens when I cap out of that?”

You can go very vertical within your niche, and when you’ve proven that niche, you can move onto the next one. This starts to flatten out your business a little bit. But start very, very vertical to make sure that you have enough users, meaning real traction in your market and real revenues.

So, that’s this week’s #AskCodelation. Come back next week to hear more!


What you should do now

1. If you have a software, startup, or business question you’d like answered by the Codelation team leave us a message on our Facebook page.

2. Thanks so much for watching (or reading!). We hope you keep up with our Codelation videos on YouTube. Make sure to subscribe to our channel (Codelation) and let us know what you think. Your questions are why we do this video series, so we’d love for you to take a second to say hello.

3. If you’d like us to work on your startup (like we did for these companies), then claim your FREE startup strategy session. On this free phone consultation, one of our experts will discuss to-market strategy, monetization options, and growth options.

4. If you’d like to learn about building your app or startup, go to our Startup Journey Blog, which is our best advice, research, how-to's and insights on how to create web apps and online businesses.

5. If you enjoyed this article, then so will your friends, so why not share it on LinkedIn, Twitter, and Facebook.