Does Market Size Really Matter ?

A lot of people wonder why market sizing is important. Just in case, you don’t, market size means the estimation of the potential of a product or service in a market. It helps to estimate the total market, your potential market share, and the revenue that can be generated from the sales of the products or services.

Knowing your market size is an important component of any strategic marketing plan. Determining the size of your target market allows you to review opportunities, plan marketing budgets correctly, and understand the level of growth you’ll need to achieve your business goals.

Similar to market sizing is market projection. While market sizing is about product knowledge and market penetration, market projection, also called market predictions, is about predicting sales or using business numbers to derive insights on market value, market analysis, future predictions and growth.

Every business owner engages in market sizing, whether they like it or not, this is why in this article, I have examined the ‘how-tos’ of market sizing. Before we get into all the details let’s start with three basic market definition questions:

1. Who’s the buyer?

2. Who’s the user? (yes, it can be different from the buyer)