Market Sizing Cases – Intro Session
Tips for market sizing cases:
There are three types of market sizing cases: population based (number of gas stations
in the US), household based (number of garden hoses sold in the EU Last year), and
finally preposterous cases (estimate the weight of a Boeing 747).
o Start by determining which type of case is it
Usually you don’t get a chance to ask clarifying questions during a market sizing case,
only as questions when you do not understand the questions or terminology
Lay out the framework/structure that you will use to answer the questions
o Make assumptions and breakdown population by demographics relevant to the
case. For example, if you are trying to find the number of smartphones sold in
the US last year you would break the population down by generation
o Estimate the number of units of what you are sizing per demographic group
Done through two ways: 1. By estimating the number, per demographic
group, that is in need of a new product of what you are sizing, and 2. By
estimating the number of replacements and upgrades to new products
which depends on the lifecycle of the product (very important to
consider).
o Do the calculations and come up with your estimate! Be prepared to defend your
assumptions and framework.
Then work the numbers and assumptions in your structure and come up with your
estimate (that way you get second a second chance to review your though process)
o Base your assumptions on some sort of logic; otherwise you could be questioned
on how you came up with them.
o Very important to use numbers that are easy to work with. Remember: the
interview is more interested in your logic than whether your assumptions and
numbers are spot on.
Some key numbers to remember:
Us population is 320 Million
Average Life Expectancy of an American is 80 years
Even distribution between ages
80 Million per generation
100 million households (Assuming on average there are 3 people per household)
