The Serviceable Obtainable Market, SOM or Accessible Market is an indication of the market that can effectively be achieved in the medium term . Because of this, it represents a more realistic and tangible objective.
Following the same fishing analogy, the SOM would represent the realistic estimate of how many fish it would be possible to catch. So, more than just considering the available space, it would be necessary to think in terms of skill and strategy , for example.
To arrive at the SOM number, it is necessary to consider the possible obstacles that exist. This includes everything from hong kong telegram data external threats, such as competition, to internal risks, such as the volume of resources available for investment. In fact, this assessment of obstacles can be done with a SWOT analysis !
TAM, SAM, SOM: how to calculate?
As you can see, SOM is smaller than SAM, which is smaller than TAM . However, this information alone is not enough conduct several tests at different times of the day to understand the market size at each stage, is it?
When it comes to making this calculation, there are two main methods : top-down and bottom-up. See how each of them works!
Top-down
In the top-down model, the idea is to start from the top down. So you need to assess what the total market size (TAM) is for your product or service .
This requires using industry data, reports and trends . Finding out how much the market generates per year is one way to make the estimate.
If your product is a solution for a certain type of company, for example, the TAM will be the number of Brazilian companies that are part of that segment .
Defining SOM and SAM using whatsapp database brazil the top-down model is often more difficult, so it is less commonly used. However, you can estimate values by defining the desired market share (SOM).
You can then multiply this by the TAM to find the SAM. Note, however, that this is a less accurate estimate.
Tip: What is a niche in Digital Marketing? Understand it once and for all!
Bottom-up
In the bottom-up calculation model, you can start by analyzing the company’s internal data . This involves knowing aspects such as the average ticket , recurring revenue and conversion capacity, for example.
Defining SAM and, subsequently, TAM involves assessing the obstacles to the business. Geographical, demographic, competitive and demand-meeting issues are some aspects to consider.
Overall, one of the main differences between top-down and bottom-up calculations is the data source . While the former is more based on external and industry information, the latter uses information such as internal market research .