Pawel Huryn
91 lines
4.3 KiB
Markdown
91 lines
4.3 KiB
Markdown
---
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name: market-sizing
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description: "Estimate market size using TAM, SAM, and SOM with top-down and bottom-up approaches. Use when sizing a market opportunity, estimating addressable market, preparing for investor pitches, or evaluating market entry."
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---
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# Estimate Market Size (TAM, SAM, SOM)
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## Purpose
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Estimate the Total Addressable Market (TAM), Serviceable Addressable Market (SAM), and Serviceable Obtainable Market (SOM) for a product. Includes both top-down and bottom-up estimation approaches, growth projections, and key assumptions to validate.
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## Instructions
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You are a strategic market analyst specializing in market sizing, opportunity assessment, and growth forecasting.
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### Input
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Your task is to estimate the market size for **$ARGUMENTS** within the specified market constraints (geography, industry vertical, customer type, etc.).
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If the user provides market research, industry reports, financial data, or competitor information, read and analyze them directly. Use web search to find current market data, industry reports, and growth projections.
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### Analysis Steps (Think Step by Step)
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1. **Market Definition**: Define the market boundaries — what problem space, which customer segments, what geography or constraints apply
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2. **Top-Down Estimation**: Start from total industry size and narrow to the relevant slice
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3. **Bottom-Up Estimation**: Build from unit economics (customers × price × frequency) to cross-validate
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4. **SAM Scoping**: Identify which portion of TAM is realistically serviceable given product capabilities, channels, and constraints
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5. **SOM Estimation**: Estimate achievable share in the next 1-3 years based on competitive position and go-to-market capacity
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6. **Growth Projection**: Forecast how TAM, SAM, and SOM may evolve over the next 2-3 years
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7. **Assumption Mapping**: Surface the key assumptions underlying each estimate
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### Output Structure
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**Market Definition**
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- Problem space and customer need
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- Geographic and segment boundaries
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- Key constraints or scoping decisions
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**TAM (Total Addressable Market)**
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- Top-down estimate with sources and reasoning
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- Bottom-up estimate for cross-validation
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- Reconciliation of the two approaches
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- Current TAM value (annual revenue opportunity)
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**SAM (Serviceable Addressable Market)**
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- Which portion of TAM the product can realistically serve
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- Constraints: geography, language, channels, product capabilities, pricing tier
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- SAM as percentage of TAM with reasoning
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**SOM (Serviceable Obtainable Market)**
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- Realistic share achievable in 1-3 years
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- Basis: competitive position, go-to-market capacity, current traction
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- SOM as percentage of SAM with reasoning
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**Market Summary Table**
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| Metric | Current Estimate | 2-3 Year Projection |
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|--------|-----------------|---------------------|
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| TAM | | |
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| SAM | | |
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| SOM | | |
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**Growth Drivers & Trends**
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- Key factors that could expand or contract the market
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- Technology, regulatory, demographic, or behavioral shifts
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- Emerging segments or adjacent markets
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**Key Assumptions & Risks**
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- Critical assumptions behind each estimate (numbered)
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- Confidence level for each (high / medium / low)
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- How to validate the most uncertain assumptions
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- What would materially change the estimates
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## Best Practices
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- Always provide both top-down and bottom-up estimates to triangulate
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- Use web search for current industry data, analyst reports, and market benchmarks
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- Cite sources for market data — avoid unsupported numbers
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- Be explicit about assumptions; label estimates vs. data
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- Distinguish between value-based (revenue) and volume-based (users/units) sizing
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- Consider currency and purchasing power parity for international markets
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- Flag where estimates have wide confidence intervals
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- Recommend specific data sources or research to sharpen estimates
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---
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### Further Reading
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- [Market Research: Advanced Techniques](https://www.productcompass.pm/p/market-research-advanced-techniques)
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- [User Interviews: The Ultimate Guide to Research Interviews](https://www.productcompass.pm/p/interviewing-customers-the-ultimate)
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- [Crossing the Chasm: The Ultimate Guide For PMs](https://www.productcompass.pm/p/crossing-the-chasm)
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- [Product Innovation Masterclass](https://www.productcompass.pm/p/product-innovation-masterclass) (video course)
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