Customer Segments — who are you really serving?
Knowing who you're building for changes everything else on the canvas. This block is where most businesses go too broad — here's how to get it right.
Who are you actually building this for?
Customer Segments are the different groups of people or organisations your business creates value for. And they're arguably the most important block on the whole canvas — because everything else exists to serve customers. If you get the segment wrong, nothing else matters.
The discipline here isn't just identifying who you serve. It's being explicit about who you don't serve — and being willing to make that call.
Different types of segments
Mass market No real distinction between customers. You're going after a broad group with similar enough needs. Think consumer packaged goods or mainstream TV.
Niche market A specific, well-defined group with particular needs. Luxury goods, specialist software, professional services. Everything — your proposition, your channels, your relationships — is built around that niche.
Segmented You serve a few groups with slightly different needs. A bank offering standard current accounts for most customers and premium services for high-net-worth individuals. Same core business, different offerings.
Diversified Two or more completely unrelated segments with very different needs. Amazon does this — consumers for e-commerce, enterprises for cloud computing. These aren't variations on the same model; they're genuinely separate.
Multi-sided platforms Two or more interdependent groups who need each other. A newspaper needs both readers and advertisers. A job platform needs both candidates and employers. The platform only creates value when both sides show up.
What makes a segment definition actually useful?
Vague segments — "SMEs", "young professionals", "tech companies" — are nearly useless for decision-making. A useful segment has three things:
- Who they are — their role, industry, size, behaviour, or demographics
- What problem they face — the specific thing your proposition addresses
- What makes them different — why you'd serve them differently from another group
The more precisely you can describe the person or organisation, the better every other decision on the canvas becomes.
Questions to explore with clients
- Who are you currently serving — and who's your best customer within that group?
- Are there customer groups you serve today that you'd be better off not serving?
- What does your ideal customer look like in detail?
- Are any of your segments changing — growing, shrinking, or shifting in what they need?
- Are you serving multiple segments with the same proposition when you probably shouldn't be?
- Who are you not reaching that you should be?