During imterview, I was asked by the interviewer to have an opinion on "whether the market size is more important or the market trend?" Please share your point of view and will be gald to discuss with anyone who's interested in this question as well :)
Market size vs Market trend. Which one is more important?
Overview of answers
Upvotes
Best answer
Hi,
Several points here:
First of all size / trend is the most common trap in the cases. Candidates often forget asking about the size / trend and get the wrong conclusion. Always ask for:
- Size of the market and its growth rate
- Size of the segments and their growth rates
- Shares of the competitors and their growth rate
- Revenue of the company and the growth rate
It's absolutely critical to discipline yourself to get the information about the size and the growth together!
Answering your specific question - both are important but growth may be more important in immature industries (e.g. the start of the telecom market when penetration was low, or ridesharing market when Uber just launched.) In other words, growth may be more important when you are creating the new market / submarket
Best
Was this answer helpful?
Hey anonymous,
My opinion is that on most of the cases it's really difficult to have an interesting and insightful view of the market without looking on both (any of them isolated seem quite weak to me!)... actually the only few exceptions I can think of is very mature industries (where market size might be more important if you already believe you have a good instinct about trend) or very new ones (where market size is still very reduced, but what actually drives future perspectives are the trends)
Anyway, I would be also quite interested in hearing others' perspectives.. and especially in knowing from which company did you get such (weird?) question?
Best
Bruno
Was this answer helpful?
I agree with the above. I think if I was to get the question and they directed me to pick only 1- I would highlight market growth trends as being more important.
Nobody wants to get on a sinking ship; a market that is growing has endless possibilities and I would think it would be unlikely for a consulting firm to advise a client to enter for example a shrinking market. They would more likely advise the client to shift towards a new market that has more promising signs eg Uber aren’t try to build and sell traditional cars, but rather enter the autonomous car market.
So many variables makes this difficult. I’m sure the interviewer was just trying to stress test you as there isn’t one correct answer IMO and more just to hear you think and communicate variables.
Cheers!
Was this answer helpful?
Related Cases
Company case by Bain & Company
Style:
Topics:
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)
175.8k
Times solved
Beginner
Difficulty
Company case by Bain & Company
Style:
Topics:
You have inherited the “Old Winery” from your grandfather, a winery that has been family-owned for five generations and can be dated back to the 16th century.
Half of the eleven hectares are used to grow white grapes, the other half to grow red grapes. They are grown in a conventional
... (Open whole case)
77.0k
Times solved
Intermediate
Difficulty
Expert case by Francesco
Topics:
Our client is SmartBridge, a nonprofit educational institution offering face-to-face tutoring services. The client operates in the US.
The mission of SmartBridge is to help as many students as possible to complete studies and prevent that they drop from the school system, in particular in disadva
... (Open whole case)
20.7k
Times solved
Advanced
Difficulty
Expert case by Luca
Topics:
Espresso Whatelse is an Italian company that produces coffee and espresso machines since 1908. It is the Italian market leader and has a strong presence overall in Europe. In 2019, Espresso Whatelse has increased its revenues but it has seen declining profit margin.
Your client wants to unders
... (Open whole case)
12.8k
Times solved
Advanced
Difficulty
Expert case by Ian
Style:
Problem definition: Our client is Korean Car Parts (KCP), a multi-national original equipment manufacturer (OEM) of car parts based in Korea. They've recently seen a decline in profits and have brought us in to understand how to address this falling profitability.
... (Open whole case)
6.6k
Times solved
Intermediate
Difficulty
414
Meetings
11,503
Q&A Upvotes
127
Awards
185 Reviews
Related Products
5 sessions package with Vlad
BCG Online Case Secrets by Francesco
Imbellus Combo: Guide + Videos by Francesco
Imbellus Test at McKinsey – Guide by Luca
McKinsey Imbellus Game Secrets by Francesco
The Secret McKinsey PEI Cheat Sheet by Robert
CoachingPlus 5
BCG Potential Test #2 by Gaurav
BCG Potential Test #1 by Francesco
Prep Guide for McKinsey PST by PrepLounge
McKinsey PST #3 by Riccardo
McKinsey PST #2 by Gaurav
