Hello,
This is Oleg, CEO of GoPractice. Key insights for choosing a market segmentI've participated in many product launches, and over time, I've started noticing specific niches with the highest chances of success. These market segments are rare finds, but identifying them is absolutely worth the effort.
Criteria for the right segment A medium- or small-sized market The key market players’ distribution meets this pattern: One large tech company with a substantial market share Many alternative ways of solving the problem (offline solutions, content products, etc.)
The leading player has some defensibility mechanisms (i. e. distribution, brand, technology, or other factors). However, you have an insight on how to overcome these advantages.
Example #1
Some years ago, we shared the story of Sense — a product for tracking and limiting social media usage. The product quickly grew to $500,000 ARR. This is a perfect example of the niche I'm describing: A medium-sized market segment A segment is dominated by a popular product (Moments app, with >$1 million in yearly revenue) Many alternative ways to problem solution The Sense team built a more effective solution and discovered new growth channels by leveraging Search Ads and organic search traffic
Example #2
The next case focuses on a niche market: tools for students.
The product was well-established, with strong brand recognition and a popular web platform. However, its mobile app was outdated. Annual revenue ranged between $10–20 million.
Another team decided to challenge the market’s leader by doing the following: Developing a better app to strengthen their product advantage Capitalizing on the fact that the market leader hadn’t trademarked its brand by using the same name with “PRO” added, effectively winning in App Store Optimization—users naturally assumed it was the premium version of the original product Replicating and republishing content with improved search engine optimization, which significantly boosted search traffic.
Not everyone is comfortable using these tactics, but they proved to be highly effective.
The Reasoning
I’ve developed these criteria through experience. Now, let’s explore the reasoning behind them.
Medium- and small-sized segments help limit competition because: A dominant product with multiple alternatives suggests that: There’s a proven market with money to be made It’s not a winner-takes-all space, leaving room for new competitors There’s potential to disrupt existing problem-solving approaches
Defensibility—and knowing how to break it—matters because: Strong defensibility prevents the market from turning into a low-margin, commoditized space Understanding how to overcome these barriers gives you a clear path to entry
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