Market sizing, for case interviews vs working on an actual project

Case Interview Market sizing
New answer on Mar 14, 2023
5 Answers
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Anonymous A asked on Mar 12, 2023

Hi All,

I have done a lot of market sizing practice for case interviews, however, I was wondering how this differs from having to size the market on an actual consulting project? For the interviews this is done fairly quickly drawing out an equation, applying assumptions, etc.. Very intrigued to know how this is applied on actual projects.

Thank you. 

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Hagen
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Content Creator
updated an answer on Mar 13, 2023
Ex-Bain and interviewer for 7+ years | >95% success rate | mentor and coach for 6+ years

Hi there,

I think this is an interesting question that may be relevant for many people. I would be happy to share my thoughts on it:

  • First of all, it really depends on the individual approach of every candidate. While there might be some who do exceptionally well and solve the problem in a way that is very similar to how it would be done on an actual project, most do not.
  • Still, in real life, market size estimations, especially for rather niche industries like those in private equity consulting, are way more complex and often not as directly solvable as other coaches have presented.
  • However, please keep in mind that most major strategy consulting companies have not used standalone market size estimations for a long time. While this does not mean it never happens, this type of case study question may not be very meaningful for both the candidate and interviewer, as only a few skills are being tested.
  • That being said, simpler market size estimations may still be a part of a case study, for instance when estimating the revenues of the client company is required.

If you would like a more detailed discussion on how to address your specific situation, please don't hesitate to contact me directly.

Best,

Hagen

(edited)

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Ian
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updated an answer on Mar 12, 2023
MBB | 100% personal interview success rate (8/8) and 95% candidate success rate | Personalized interview prep

Hi there,

How “typical” candidates do market sizing? Competely different to the real world (and why they often fail interviews)

How “optimal” candidates do market sizing? Very similar to an actual project. (and why they often pass market sizing in interviews)

Remember that the entire interview process is designed to mimic the real world. That's the entire point!

However, unfortunately most candidates just memorize stuff. They follow steps but they don't learn how to think and approach problems like a real consultant. Once they do, they drastically increase their chances of success.

Remember, market sizing is not about randomly picking numbers and buckets. There is a logical process to it!

(edited)

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Paul
CoachingPlus Expert
replied on Mar 12, 2023
PL-level BCG experience (6 years)|Interviewer at BCG| 6/6 personal + 95%+ candidates offer success rate

Hi there,

complementing Allen - I would say the logic building blocks in real cases are similar vs interview 

e.g. I had to size the solar pv, energy efficiency market evolution at 5 years for specific residential and industrial segments 

We built a semi-sophisticated excel model but basically my team

1) estimated “smart”drivers and proxies for market size evolution based on reports, business sense, client knowledge, bcg knowledge

→ you will size most of the time obscure sub-segments of market where no deterministic data points are available 

2) triangulated / pressure-tested outcomes

in summary a more in depth exercise vs an interview but built on EXACTLY the same conceptual tools and reasoning (hence the relevance of asking mkt sizing questions during interview :)  )

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Allen
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replied on Mar 12, 2023
Ex-McK Experienced Hire and EM - I show you how to perform at your best

As a general tip, you might as well start these questions with, “I know it depends, but…”

I have always been shocked how similar the “market sizing” process is to what one does during interviews.  Often applied when trying to estimate savings from different initiatives.  Identify the drivers, estimate the values, communicate. 

Sometimes you need to triangulate assumptions with other knowledgeable sources, but they're basically going to do the same thing also! 

Best,

Allen

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Andreas
Expert
replied on Mar 14, 2023
McKinsey EM | Top MBB Coach | >70% Success Rate | Free Introductory Calls

Hi there,

the main difference between a case interview and real life market sizing exercises 

(1) You have more time and data sources available to get better estimates

(2) You are able to test multiple approaches/structures to get to the market size

(3) You are better able to triangulate/reality check outcomes

What is very similar is the fact that a structured approach is used, as in case interviews.

Cheers

Andreas

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Hagen gave the best answer

Hagen

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Ex-Bain and interviewer for 7+ years | >95% success rate | mentor and coach for 6+ years
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