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Market Sizing Evaluating the Opportunity School of Management Strategy & Innovation Department.

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Presentation on theme: "Market Sizing Evaluating the Opportunity School of Management Strategy & Innovation Department."— Presentation transcript:

1 Market Sizing Evaluating the Opportunity School of Management Strategy & Innovation Department

2 Its the most common engagement question How large could this market be? No known data source Limited awareness of the need Market doesnt exist yet Cricket is huge in India and the UK. How large is the market in the US

3 Page 3 Sales Funnel – TAM SAM SM CM Total Available Market –Affected Population Served Available Market –With the need Served Market – and capability to buy Covered Market – covered by Sales Channel TAM SAM SM CM USAGE X

4 Start with what you know Population –US –EU –BRIC –Indonesia Volume Weight –Gallon of Water –Liter of Water Round the numbers so that theyre easily divisible by ten. Current Prices Relative Size

5 What is the total Available Market for Cricket Balls in the United States? What Questions did you ask? How did you determine the number of people that might potentially have the need? Did you round it to 300 million not million Total Available Market

6 Of the 300 million residents how many of them have a need? What Questions did you ask? Did you use an elimination technique or work from an assumption up? Did you note your assumptions clearly? Served Available Market

7 Of the 1 million residents how many of them have the capability to buy? What Questions did you ask? Does the price of a cricket ball make a difference? Did you note your assumptions clearly? Serve Market

8 Why do you treat Need (want) before the Capacity to buy? Path dependency Greater degrees of freedom Treat pricing as a distinct assumption and avoid simultaneous equation

9 Assessing the critical role of channel of distribution? What Questions did you ask? Sales Logic – Customers will not buy: –That which they dont know (build awareness) –That which they cant physically get (channel) Did you note your assumptions clearly? Covered Market

10 Existing Market case questions often hinge on USAGE What Questions did you ask? Replacement logic Churn logic Recidivism Did you note your assumptions clearly? USAGE

11 What did you conclude? The size of the cricket ball market in the United States is _____________


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