Hi, may I know if ‘total market’ and ‘total addressable market’ are different things? And if so, how do they differ? Thanks!
(edited)
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Total Market vs Total Addressable Market
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As I was preparing/presenting pitch decks to the investors for our startup, there were only 3 terms about the market size:
1- TAM (Total Addressable Market): The maximum size for an opportunity
2- SAM (Serviceable Addressable Market): Segments of TAM, which you are capable of serving
3- SOM (Serviceable Obtainable Market): The portion that you can capture from SAM.
Therefore, I would say, Total Market is another way of saying TAM and there should be no difference between those 2 terms in terms of meaning.
Bests,
Emre
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Total market usually has the total potential for sales. So for example the total market for a laptop is theoretically the entire population as everyone can potentially use a laptop.
However the addressable market is limited to the realistic number of people that would qualify as a customer by factors such as age, ability to purchase the laptop (income), access to stores, need for a laptop etc.
Total addressable is almost always lower than the total (potential) market
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Hello,
Agree with Udayan here. TAM is a subset of TM. If you google these terms, there is a further subset called Serviceable Available Market which takes it one level more granular.
All the best!
Rushabh
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Hi there,
TM => TAM => SAM => SOM
The others have all already defined each on specifically :)
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