Crafting a Value Proposition: Let Customers Define Your Niche

Discover how to refine your value proposition by engaging with customers. Learn why your niche is revealed through their needs, not assumptions.

This article was originally published in 2016, and has been updated in 2025.

Understanding and articulating your value proposition is the foundation of any successful business. It's not just about what you offer—it's about why customers should choose you over competitors. But if you're struggling to find your niche or define your unique value, the solution lies in one simple but often overlooked strategy: talk to your customers.

One of my favorite quotes I heard in the past year,

“You don’t choose your niche; your customers tell you what your niche is.”

Let’s explore how this works and why customer feedback is the key to unlocking your business’s potential.

What Is a Value Proposition?

A value proposition is a clear, concise statement that communicates the unique benefits of your product or service and explains why it’s the best option for your target audience. It answers the critical question: “Why should I buy from you instead of someone else?”

For example, instead of saying, “I’m a graphic designer who creates logos for $50 an hour,” consider reframing it as, “I design memorable brand identities that help small businesses stand out and attract loyal customers.” This approach shifts the focus from selling time or tasks to delivering tangible outcomes that align with customer goals.

Compelling value propositions typically uphold the following traits:

• Specificity: They clearly define the problem being solved or the need being met.

• Outcome-Oriented: They focus on measurable benefits or results rather than features.

• Differentiation: They highlight what makes the offering unique compared to competitors.

By crafting a value proposition that embodies these qualities, you can better communicate how your work creates meaningful value for your audience.

Why Finding Your Niche Starts With Listening

If you’re unsure about where your efforts are best spent, it’s likely because you haven’t yet identified the specific needs of your target audience. The best way to discover these needs is by engaging directly with potential customers or industry peers.

Why Customer Feedback Defines Your Niche

1. Customers Know Their Pain Points Better Than You Do
   Customers often articulate problems you may not have considered. For instance, Beyond Meat initially targeted vegetarians but expanded its niche after listening to health-conscious meat-eaters seeking plant-based options. This pivot allowed them to capture a broader market while staying true to their mission. (though, I will say that I believe the situation Beyond Meat has experienced as a company is one that was not predictable.)

2. Latent Needs Are Often Hidden
   Customers may not always know what they want until they see it—or until you ask the right questions. Harvard Business School’s “Look, Ask, Try” framework emphasizes observing customer behavior and asking open-ended questions to uncover unmet needs.

3. Feedback Fuels Innovation
   Integrating customer insights into product development ensures relevance and differentiation. For example, Converse repositioned its Chuck Taylor sneakers as fashion staples after recognizing demand from retro-style enthusiasts.

How to Engage Customers and Uncover Your Niche

1. Conduct Conversations

Start by having meaningful discussions with potential customers. These can be informal chats, structured interviews, or focus groups. The goal is to understand:

• What challenges they face.

• How they currently solve these challenges.

• What they wish existed but doesn’t.

For example, Zapier’s CEO Wade Foster spent hours on Skype calls with early users of their prototype software, iterating based on real-time feedback. This hands-on approach helped them refine their offering and build loyalty.

2. Use Surveys and Social Listening

Leverage tools like surveys or social media platforms to gather broader insights:

• What are people complaining about in forums or reviews?

• What trends are emerging in online communities?

Platforms like Reddit or LinkedIn can reveal niche-specific pain points and opportunities for innovation.

3. Observe Behavior

Sometimes actions speak louder than words. Watching how customers use existing products—or struggle without them—can reveal gaps in the market. For instance, Bonobos identified a need for better-fitting men’s pants by observing dissatisfaction with off-the-rack options.

4. Test and Iterate

Once you’ve gathered insights, test small-scale solutions tailored to those needs. Launching a minimum viable product (MVP) allows you to validate assumptions quickly and refine based on real-world usage.

A Personal Note: Experimenting With My Own Niche

I want to share that this process isn’t just something I recommend—it’s something I’m actively doing myself with my content and thought leadership efforts. Like many of you, I’m experimenting with different styles, formats, and modalities to see what resonates most with my target audience.

Some days I focus on long-form articles like this one; other days I test shorter posts or conversational videos aimed at sparking engagement in new ways. Each piece of feedback—whether it’s a comment on LinkedIn or an email reply—helps me refine my approach and understand what my audience finds most valuable.

This iterative process isn’t always straightforward, but it’s incredibly rewarding because every experiment brings me closer to creating content that truly connects with my audience’s needs and challenges. And just like finding a business niche, this journey requires listening carefully, adapting quickly, and staying open to change.

Real-World Example: Letting Customers Define Your Niche

Consider Untuckit, a brand that started by solving a simple problem: men’s shirts that look good untucked. The founders didn’t guess this was an issue—they heard it repeatedly from frustrated consumers. By focusing narrowly on this pain point, Untuckit carved out a profitable niche and later expanded into broader apparel categories.

Actionable Steps to Define Your Value Proposition

1. Identify Core Strengths
   Reflect on what you do exceptionally well that aligns with solving customer problems.

2. Engage With Customers
   Conduct interviews, surveys, or observe behavior to uncover explicit and latent needs.

3. Articulate Benefits Clearly
   Frame your value proposition around outcomes—not features or price points.

4. Test Your Messaging
   Run A/B tests on marketing materials or landing pages to see which value propositions resonate most with your audience.

5. Refine Continuously
   As customer needs evolve, so should your offerings and messaging.

Conclusion

Your value proposition isn’t just about what you think makes your business special—it’s about what your customers perceive as valuable. If you're struggling to find clarity in defining your niche, take a step back and listen more closely to those you're trying to serve.

Remember:

Your niche isn’t something you create in isolation; it’s something revealed through conversations with your market.

By prioritizing customer feedback and focusing on solving real problems, you’ll not only define your niche but also position yourself as an indispensable solution within it—whether that’s through products, services, or even thought leadership content like this one!