Market sizing

Question

Hello Community.

For example, in market sizing qns such as estimate the market size of cars in a city (in $) or let's the market size of iphones in a country (in $), is it worth claryfing with the interviewer if we are focusing on the first-hand market or second-hand market? Or should I not and therefore include both ? (average it out with it comes to the pricing)

Answer 1

Hi!

Yes, this is an absolut must! You HAVE to verify the scope of the question. Never just assume something or shoot from the hip before having aligned with the interviewer.

Cheers, Sidi

Answer 2

Hi Anonymous,

it is totally fine to ask clarifying questions at the beginning of a market sizing, thus feel free to do so if you have doubts.

Best,

Francesco

Answer 3

Hello,

Clarifying the rules of the estimation is not only worth, but it's mandatory.
Before starting the case, you have to do as many questions as you need to be sure that you are considering the right set of information.
Usually you are asked to consider just some specific segment (e.g. first-hand market), but it would be nice to do a quick estimation at the end of the case, starting from your results, also for the other parts.

Best,
Luca

Answer 4

Yes, of course, always clarify the question – you shouldn't make any assumptions about the question asked. You should always know what question you are about to answer.

Answer 5

Hello!

It´s not only worth to be clarified, it´s a must! Furthermore, it has no downside, since:

You will seem perfectly structured from the beggining
The more info you have (relevant one, for sure, not stupid questions), the easier it is to nail the analysis.

Hope it helps!

Cheers,

Clara

Answer 6

Hi, it's a great observation and you are supposed to clarify it at the beginning of the case with the interviewer.

Best,
Antonello

Answer 7

Hi there,

Providing some market sizing thinking for anyone revisiting this Q&A:

Remember that there's rarely a "best" answer with market sizing. What's important is that you break down the problem the way it makes sense to you. Importantly, break it down so that the assumptions you make are the ones you're most comfortable in.

For example, do you know all the major brands? Great go with that. Do you understand all the segments of that country's population (either age or wealth or job breakdown)? Go with that. Do you know the total market size of the tourism (or hotel) industry? Then break it down that way.

Some tips:

Just like in a case, make sure you understand the question - what are you really being asked to calculate
Decide whether a top-down or bottom-up approach is best
Figure out what you know you know, and what you know you don't know, but could estimate
1. This helps you determine how to split out buckets
Stay flexible - you can start with a "high-level" market sizing, but gauge your interviewers reaction....if it looks like they want you to do more...then go along level deeper in terms of your splits