Hi guys - I've got an last minute interview arranged for this week that I know is going to include a market sizing element. Are there any essential tips / approaches / frameworks for market sizing cases that I should be aware of? I'm trying to do some rapid prep before the end of the week. Best
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Quick tips for market sizing?
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Hi,
1) first of all every market size can be a bit different, but the most important thing is that you should be able to understand and figure out a specific driver...
for example if the product/ service is connected to the average use from people... you can use the population as main driver; instead if it is something connected to a geographical distribution (eg number of taxi or newsstands in New York City) you can think about the number of blocks and then position a reasonable number of items suing the blocks
2) once you have figured out the main driver, you can think about a segmentation (eg by age brackets...)
3) then you need to make reasonable hypothesis to convert a number (eg number of people or number of shops...) into a yearly revenue figure. Important here to remember that the market size is usually an yearly figure and not a monthly one...
lets try to make as much granular thinking as possible, while not exceeding 15/20 minutes.
its usually a good strategy rounding numbers
let me know if I can help you more!
cheers
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Hi Anonymous!
Please refer to this excellent article on Preplounge: https://www.preplounge.com/en/bootcamp.php/case-cracking-toolbox/identify-your-case-type/market-sizing
Cheers, Sidi
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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
- 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
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