Hi, share your knowledge with the community!

Is this a MECE approach?

Gerard

Hi everyone,

I just came across the following text (see below) from an e-book of Quartz strategy consultants. And I'm wondering if you can share your thoughts regarding the approach of market size.

1) Is it really a MECE approach? (Points 1 and 2 easily overlaps point 3, don't you think so?)

2) How would you do it?

The text is an extract of a real-case interview section of the ebook.

"Quartz: You mentioned that the market potential is important. What is your best estimate of the Danish market for paper-based calendars?

Candidate: In order to determine the market size I would split the market into three groups:

1. Student calendars 2. Calendars for business people 3. Calendars for households/private use

I would define the student group as people from 10 to 25-26 years of age. Hence, the group is approximately 20% of the population, assuming a fairly equal distribution of the population in different age groups from 0-80 years. That group amounts to about 1 million people. I'm disregarding that some students do not study past secondary school, but I will include this in the demand per person in this segment. Almost all students have at least one calendar, and many have two due to the free calendars or half-year calendars. So I would assume an annual demand of 1.2 calendars per person in this group. That's 1.2 million calendars for the student group.

The business group includes people in the work force. If we assume these are people between from 25 to 65 years of age that would be 50% of the population – 2.5 million people. Of this group, fewer people have work-related calendars, I believe. 20% coverage would give a demand of 0.5 million calendars per year in this segment. I don't think it is higher than this given the increased use of electronic calendars.

Finally, there are calendars for private use. As far as I remember, there are something like 2.3 million households in Denmark, and I would imagine that at least one person in every second household has a calendar for private use. This gives a demand of about 1.15 million calendars for private use.

This gives us 1.2 million calendars in the student segment, half a million in the business segment and 1.15 million in the household/private use segment. In total, it's a market of approximately 2.9 million calendars in Denmark.

Quartz: Thank you. I think we will stop the case here. "

Thanks in advance,
Best

(edited)

Valentin replied on 05/23/2017

Hello Gerard,

1. For me the answer is MECE. Students and business people calendars are totally different types and purposes than the one you'd fine in the middle of a kitchen.

2. I would have splitted the market into private and business.
Private : 1 every two households
Business : 1 for each household
Personnally, I don't like the age distribution approach as it implies too heavy assumptions.

Best regards,

Related BootCamp article(s)

Market Entry

Market Entry Strategy Frameworks may be a great solution to apply in your Case Interview if your client is searching for growth alternatives.

2 Comment(s)

4C Framework

Get an overview over a company’s customers, competition, cost and capabilities by conducting a 4 C analysis in your case interviews

2 Comment(s)

MECE Principle

The MECE principle is a way of segmenting information into sub-elements that are mutually exclusive and collectively exhaustive. Learn more in our bootcamp.

2 Comment(s)

Issue Tree

The Issue Tree Framework can be used to break down the problems of a case to its components and significantly increase your speed during case interviews.

6 Comment(s)

The Value Chain

The Value Chain - as e.g. by Porter - is a classic framework to structure the activities of a business and add value to products by transforming resources.

3 Comment(s)

Related case(s)

Bain case: Asian lubricants producer

Solved 35.6k times | Rating: (4.7 / 5.0)

LubricantsCo, a very successful Asian premium producer of lubricants in their native region, would like to further increase their revenue and profit. The product range ranges from lubricants in the automotive sector (e.g. motor and gear oil) to industrial applications (e.g. fats, heavy-duty oils). ... Open whole case

Roland Berger case: Light on!

Solved 15.5k times | Rating: (4.7 / 5.0)

LumCO, a company producing injection-molded components for lighting applications, has operated successfully in its native European market. The company wants to open up one production facility each in China and the United States and establish their own distribution network in both countries to serve ... Open whole case

Nutripremium

Solved 22.5k times | Rating: (4.5 / 5.0) |

Nutripremium is a very well-known premium nutrition food company in Europe (€1 billion revenue last year). It is based in Spain and has an excellent market share not only in its home country but also in Portugal, France, Italy and Germany. Nutripremium has two main lines of products: Vitam ... Open whole case

Children vaccine

Solved 21.9k times | Rating: (4.4 / 5.0) |

Beyer, one of the biggest pharmaceutical companies in the world, just invented a very reliable vaccine against Chickenpox, a disease that affects children in the age from 2 to 16 years. Beyer came to you wondering what their potential sales in Europe in the first year would be if they launched th ... Open whole case

Gas station

Solved 16.1k times | Rating: (4.3 / 5.0) |

How many gas stations are there in Paris? Suppose a friend of yours wants to open a gas station in Paris. What aspects should he consider? Open whole case