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Market sizing

Market sizing
New answer on Dec 31, 2021
7 Answers
2.0 k Views
Anonymous A asked on Mar 14, 2020

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)

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Best answer
Sidi
Expert
replied on Mar 15, 2020
McKinsey Senior EM & BCG Consultant | Interviewer at McK & BCG for 7 years | Coached 350+ candidates secure MBB offers

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

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Daniel
Expert
Content Creator
replied on Mar 20, 2020
McKinsey / ex-Interviewer at McKinsey / I will coach you to rock those interviews

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.

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Luca
Expert
Content Creator
replied on Mar 16, 2020
BCG |NASA | SDA Bocconi & Cattolica partner | GMAT expert 780/800 score | 200+ students coached

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

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Francesco
Expert
Content Creator
replied on Mar 15, 2020
#1 Coach for Sessions (4.500+) | 1.500+ 5-Star Reviews | Proven Success (➡ interviewoffers.com) | Ex BCG | 10Y+ Coaching

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

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Ian
Expert
Content Creator
replied on Dec 31, 2021
#1 BCG coach | MBB | Tier 2 | Digital, Tech, Platinion | 100% personal success rate (8/8) | 95% candidate success rate

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:

  1. Just like in a case, make sure you understand the question - what are you really being asked to calculate
  2. Decide whether a top-down or bottom-up approach is best
  3. 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
  4. 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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Antonello
Expert
Content Creator
replied on Mar 23, 2020
McKinsey | NASA | top 10 FT MBA professor for consulting interviews | 6+ years of coaching

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

Best,
Antonello

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Clara
Expert
Content Creator
replied on Mar 15, 2020
McKinsey | Awarded professor at Master in Management @ IE | MBA at MIT |+180 students coached | Integrated FIT Guide aut

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

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Sidi gave the best answer

Sidi

McKinsey Senior EM & BCG Consultant | Interviewer at McK & BCG for 7 years | Coached 350+ candidates secure MBB offers
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