I recently worked with a startup developing new products for personal care. In their case, they did just that. They wanted to experiment at low volume with a product that can have a very wide appeal, so they decided to focus on a specific gender, in a specific age range, in one neighborhood of a single city. For them, the follow-on markets don’t require a significant product repackaging or redesign, but they are simply moving into adjacent markets on step at a time by expanding geographic and demographic targeting in their advertisements. The original decision of who to focus on was made quite simply by the founder asking, “Who could I sell this to today?” So she picked a neighborhood where she had lived, developed a persona for the type of customer she was sure she could convince to buy, and has simply been expanding her inventory of persona’s.

Jared, could you more specifically describe what you mean by “consumable goods”? In general, segmenting markets is done by multiple factors – industry, size of company, demographic/psychographic of users, type of champion/economic buyer, use case and geography. It is conceptually possible that geography does not matter but in reality I have not found a case where that is true.
You have to segment down to a beachhead market you feel comfortable is not just definable but also identifiable and offers you sufficient size to gain important momentum, skills and assets to enter the next market — and be a market with high odds of winning if possible.