Targeting Audience (boon or bane)

We have people out here on this channel who have learned a lot from each other,as a part of this learning scheme there was this question tickling in my mind.

Is targeting audience a BOON or is it a BANE i know its a never ending debate ………..But still the question needs to be answered.

I am working over this start up which aims to target 1500000 people of a particular area and cure their daily need like groceries stationary etc. via Door step services

The concept is more or less similar to a E Grocery Portal but with a added menu for people of all ages. 

As a lot of people are successful opening e Portals site but they fail to target audience their portals are more or less junkyards on web.

So will it be a better option to initially target an area with which you are well aware so that its easier for anyone to understand the whole cycle and when its well established , one should expand it. 

I seriously need your suggestions guyz as you teach me a lot…………….