What is this process called and when is it beneficial?

Let's say you develop a simple tool or service, for example a timer app.
Now you put it out into the market as "The new shiny, solves it all, timer" and find very little success because people are confused and overwhelmed with all the features. You get back to the drawing board and try to sell subsets under a different label for your app, focusing on different client groups one-by-one.

You publish a timer for chefs and hobby cooks.
Then another timer with some UI tweaks for workout sessions.
Then change the interface to sell it as pomodoro timer
etc etc

What are your experiences with this concept? I could not find many useful resources about this topic as I am not sure what the correct term for it is.