This plugin works with (flat, non-hierarchic) taxonomies such as product tags. Custom taxonomies must be accessible by Tag Groups Premium and for many features they must have archive pages. This depends on the way how they are defined by the plugin or theme that provides them.
The best way to find out if a custom taxonomy works is to install Tag Groups Premium and check if you can select this taxonomy in the settings. Then create a test group and assign custom taxonomy tags to them.