Cookie and Privacy Settings

This website uses cookies to enable essential functions like the user login and sessions. We also use cookies and third-party tools to improve your surfing experience on preplounge.com. You can choose to activate only essential cookies or all cookies. You can always change your preference in the cookie and privacy settings. This link can also be found in the footer of the site. If you need more information, please visit our privacy policy.

Data processing in the USA: By clicking on "I accept", you also consent, in accordance with article 49 paragraph 1 sentence 1 lit. GDPR, to your data being processed in the USA (by Google LLC, Facebook Inc., LinkedIn Inc., Stripe, Paypal).

Manage settings individually I accept
expert
Expert with best answer

Pankaj

100% Recommendation Rate

5 Meetings

149 Q&A Upvotes

USD 149 / Coaching

9

Segmenting by age groups for market sizing?

Hey guys,

could some of you give me their methods of segmenting people per age groups? Is it reasonable to assume that groups of equal age length (say 0-20, 20-40 ... etc.) have a somewhat equal proportion of people in it?

I know that in western countries the distribution might be slightly skewed as there is a greater percentage of elderly people. However, in my opinion this would make the sizing too sophisticated. What I would do is that I would acknowledge that the distribution might not be evenely and that there might be a greater proportion of elderly but I would think that for coming up with a quick market sizie it is sufficient to build on that assumption.

Is that good?

Hey guys,

could some of you give me their methods of segmenting people per age groups? Is it reasonable to assume that groups of equal age length (say 0-20, 20-40 ... etc.) have a somewhat equal proportion of people in it?

I know that in western countries the distribution might be slightly skewed as there is a greater percentage of elderly people. However, in my opinion this would make the sizing too sophisticated. What I would do is that I would acknowledge that the distribution might not be evenely and that there might be a greater proportion of elderly but I would think that for coming up with a quick market sizie it is sufficient to build on that assumption.

Is that good?

9 answers

  • Upvotes
  • Date ascending
  • Date descending
Best Answer
Book a coaching with Pankaj

100% Recommendation Rate

5 Meetings

149 Q&A Upvotes

USD 149 / Coaching

It is usually fine to assume that population is distributed evenly by age. However, some countries are well-known for having a younger or older demographics. If you get a sizing case for such a market, it is usually a good idea to tweak the assumptions slightly or atleast show the interviewer you're aware of these nuances.

  • For example, sizing the smartphone market in India, and doing a segmentation by age, you can assume that age <30 is 50% of population (median age is 28), and assume an even split for >30 population. It might look something like <15 (25%), 15-30 (25%), 30-50 (20%), 50-70 (20%), >70 (10%).
  • Similarly, if you get a question for Japan (median age is 50 i think), you can assume >50 population to be 50% and <50 to be remaining 50% and divide evenly within that.

The intent is to differentiate yourself in an interview by showing that you're aware of these nuances. It is perfectly ok for you to just mention these factors, and align with the interviewer that you are going to make simplifying assumption of dividing population evenly by age.

Was this helpful?

It is usually fine to assume that population is distributed evenly by age. However, some countries are well-known for having a younger or older demographics. If you get a sizing case for such a market, it is usually a good idea to tweak the assumptions slightly or atleast show the interviewer you're aware of these nuances.

  • For example, sizing the smartphone market in India, and doing a segmentation by age, you can assume that age <30 is 50% of population (median age is 28), and assume an even split for >30 population. It might look something like <15 (25%), 15-30 (25%), 30-50 (20%), 50-70 (20%), >70 (10%).
  • Similarly, if you get a question for Japan (median age is 50 i think), you can assume >50 population to be 50% and <50 to be remaining 50% and divide evenly within that.

The intent is to differentiate yourself in an interview by showing that you're aware of these nuances. It is perfectly ok for you to just mention these factors, and align with the interviewer that you are going to make simplifying assumption of dividing population evenly by age.

Was this helpful?

Book a coaching with Adi

100% Recommendation Rate

100 Meetings

9,361 Q&A Upvotes

USD 169 / Coaching

Hey there,

Ideally this will depend on the country/geography and population sizes and which industry you are looking at e.g. social media users or shampoo users. I advise following options depending the case/industry that you get given:

1. Age ranges by life cycle stages: babies, children, adolescents, adults, middle-age, and seniors

2. Generation-based: Baby boomers, Gen X, Millennials, Gen Z

Use common sense and keep it simple. You are not expected to come up with very precise ages ranges.

Hey there,

Ideally this will depend on the country/geography and population sizes and which industry you are looking at e.g. social media users or shampoo users. I advise following options depending the case/industry that you get given:

1. Age ranges by life cycle stages: babies, children, adolescents, adults, middle-age, and seniors

2. Generation-based: Baby boomers, Gen X, Millennials, Gen Z

Use common sense and keep it simple. You are not expected to come up with very precise ages ranges.

Book a coaching with Ian

100% Recommendation Rate

336 Meetings

29,719 Q&A Upvotes

USD 289 / Coaching

Hi there

You cannot assume the age groups are the same

Part of market sizing is being able to determine which segments (whichever they may be) are different based on what you know of the world.

If you're market sizing for India, you need to recognize that half the population is young.

If you're market sizing for Japan, you need to realize that half the population is old.

If you don't do this, you will 100% be dinged.

One other people of advice: Try not to do 0-20, 20-40, 40-60, 60-80, 80+. This overcomplicates! just do young, middle-aged, old

Hi there

You cannot assume the age groups are the same

Part of market sizing is being able to determine which segments (whichever they may be) are different based on what you know of the world.

If you're market sizing for India, you need to recognize that half the population is young.

If you're market sizing for Japan, you need to realize that half the population is old.

If you don't do this, you will 100% be dinged.

One other people of advice: Try not to do 0-20, 20-40, 40-60, 60-80, 80+. This overcomplicates! just do young, middle-aged, old

Book a coaching with Ken

100% Recommendation Rate

62 Meetings

5,724 Q&A Upvotes

USD 239 / Coaching

I think it comes down to what you are solving for where you want to make sure your increments are relevant to the problem (e.g., child, adult, vs. elderly population, etc.). From a pure math perspective, equal age increments makes things more simple so that would be my default. The geographic nuances and other assumptions are important to share upfront with your interviewer who should also give guidance if they want you to segment differently.

I think it comes down to what you are solving for where you want to make sure your increments are relevant to the problem (e.g., child, adult, vs. elderly population, etc.). From a pure math perspective, equal age increments makes things more simple so that would be my default. The geographic nuances and other assumptions are important to share upfront with your interviewer who should also give guidance if they want you to segment differently.

Book a coaching with Francesco

100% Recommendation Rate

3,554 Meetings

18,942 Q&A Upvotes

USD 479 / Coaching

Hi there,

Yes, your approach is totally fine.

If the country is skewed on young/old, just mention to the interviewer you know the population is skewed and ask confirmation if it is fine to split equally.

Most of the time they will say it is fine and you can continue without complications.

Best,
Francesco

Hi there,

Yes, your approach is totally fine.

If the country is skewed on young/old, just mention to the interviewer you know the population is skewed and ask confirmation if it is fine to split equally.

Most of the time they will say it is fine and you can continue without complications.

Best,
Francesco

Book a coaching with Udayan

99% Recommendation Rate

108 Meetings

4,018 Q&A Upvotes

USD 249 / Coaching

The entire point of estimation techniques is to quickly get to a reasonable answer with reasonable assumptions. It is totally acceptable to assume equal distribution as long as you state that you are doing so and why (e.g., for ease of calculation). If the interviewer does not agree they will ask you to change your approach. Yes it is not perfect but with clear communication you will get the direction you need from the interviewer.

Udayan

The entire point of estimation techniques is to quickly get to a reasonable answer with reasonable assumptions. It is totally acceptable to assume equal distribution as long as you state that you are doing so and why (e.g., for ease of calculation). If the interviewer does not agree they will ask you to change your approach. Yes it is not perfect but with clear communication you will get the direction you need from the interviewer.

Udayan

(edited)

Book a coaching with Gaurav

100% Recommendation Rate

200 Meetings

6,672 Q&A Upvotes

USD 239 / Coaching

Hi there!
Segmentation by age groups can be strikingly different under factors such as marital status (a mother of 25 and a woman without a child have a lot of differences in behavior), work, financial wealth, and geography.
but, more often than not, the following groups have the most common features of behavior:
16-18, 18-21, 21-25, 25-30, 30-35, 40-45, 45 - 60, 60 and above
There may be other variations, very often used:
12-17, 18-24, 25 - 34, 35-45, 45 - 55, 55 and above

Each country has very different demographic indicators, so different groups may have completely different percentages of the population.

Was it helpful?
GB

Hi there!
Segmentation by age groups can be strikingly different under factors such as marital status (a mother of 25 and a woman without a child have a lot of differences in behavior), work, financial wealth, and geography.
but, more often than not, the following groups have the most common features of behavior:
16-18, 18-21, 21-25, 25-30, 30-35, 40-45, 45 - 60, 60 and above
There may be other variations, very often used:
12-17, 18-24, 25 - 34, 35-45, 45 - 55, 55 and above

Each country has very different demographic indicators, so different groups may have completely different percentages of the population.

Was it helpful?
GB

Book a coaching with Clara

100% Recommendation Rate

62 Meetings

16,625 Q&A Upvotes

USD 229 / Coaching

Hello!

Indeed, the good thing about segmenting is the fact that those groups:

  1. Don´t act/react them same: so you can tailor the approach
  2. They are not evenly distributed: if you look at the population pyramid, it has totally nothing to do in developped vs. delopping countries. You can easily see a couple in Google, that will suffice to get the idea.

Hope it helps!

Cheers,

Clara

Hello!

Indeed, the good thing about segmenting is the fact that those groups:

  1. Don´t act/react them same: so you can tailor the approach
  2. They are not evenly distributed: if you look at the population pyramid, it has totally nothing to do in developped vs. delopping countries. You can easily see a couple in Google, that will suffice to get the idea.

Hope it helps!

Cheers,

Clara

Related case(s)

Oliver Wyman case: Full Electrons Ahead

Solved 105.5k times
Oliver Wyman case: Full Electrons Ahead Your client, large automotive OEM WyCar, has developed its first fully electric vehicle (EV) and introduced it as a pilot on the Austrian market last year. However, sales have been far below the expected numbers. The management has engaged you to support them in understanding the reasons and advise them on how to adjust the product offering.
4.6 5 6569
| Rating: (4.6 / 5.0)

Your client, large automotive OEM WyCar, has developed its first fully electric vehicle (EV) and introduced it as a pilot on the Austrian market last year. However, sales have been far below the expected numbers. The management has engaged you to support them in understanding the reasons and advise ... Open whole case

Bain Case: Old Winery

Solved 73.7k times
Bain Case: Old Winery 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 way, i.e. they are not organically farmed and certified. The vine stocks are in a good condition regarding age and care. Overall, the only ¼ of the harvest is made into wine by the winery itself; the rest is sold. Your grandfather never wanted to change the image of the winery and left the managerial and administrative task to a young and energetic wine-maker. Due to the not so well-known brand, the demand for the “Old Winery” wine is currently rather low. You do not intent to run the winery operatively, given your limited knowledge of winemaking, but find the idea of owning a winery exciting. Your plan is to give the winery some fresh impetus.
4.4 5 1952
| Rating: (4.4 / 5.0)

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 way, i.e. the ... Open whole case

Roland Berger Case: Onlinestar

Solved 52.7k times
Roland Berger Case: Onlinestar Onlinestar, an online retailer of furniture and garden products (core business), has grown significantly in recent years as a result of an expansion of its product portfolio. The company mainly imports goods from Chinese manufacturers but also operates its own production of cat lavatories (special business) in Eastern Europe. The company sells its goods via Amazon and eBay, and recently via an online shop on its website. Despite this development, the financial ratios have deteriorated in recent years. In particular, the gross profit margin decreased significantly. Combined with a significant increase in shipping costs, this led to a negative result for the first time in the recently ended fiscal year and a resulting strained financial situation. Against the background of expected stagnating sales for the current financial year, short-term action is required. The board of Onlinestar asks you for an analysis of the reasons for the negative result as well as a derived recommendation for action. As a consultant, you should bring in your knowledge in online trading and develop solutions. In addition, the management board would like to receive a sales and gross profit plan from you for the current financial year.
4.3 5 1066
| Rating: (4.3 / 5.0)

Onlinestar, an online retailer of furniture and garden products (core business), has grown significantly in recent years as a result of an expansion of its product portfolio. The company mainly imports goods from Chinese manufacturers but also operates its own production of cat lavatories (special b ... Open whole case

Nutripremium

Solved 71.6k times
Nutripremium 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: Vitamin-supplements for pregnant women Concentrated dehydrated aliments and vitamin pills for sick patients (with Diabetes or Cancer). The CEO of Nutripremium thinks that the market in Europe is starting to get saturated and wants you to analyze the Chinese market. What are the key areas you would explore to determine whether this is a good idea?
4.5 5 2286
| 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: Vitamin-su ... Open whole case

Children vaccine

Solved 63.7k times
Children vaccine 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 this product next year. They are only interested in the overall sales revenue as they already know that the vaccine can be sold for a profit. This is more meant to show them how big the volume they have to supply is and what the revenue would be.
4.4 5 2300
| 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 this ... Open whole case