Customers and pricing
TAM, SAM and SOM
Total market, the part you can serve, and the part you can win.
Facts checked against sources onWhat does TAM, SAM and SOM mean?
TAM (total addressable market) is total demand for a product category. SAM (serviceable available market) is the part your product, regions and channels can reach. SOM (serviceable obtainable market) is the part you can realistically win in a set time. An entry case should size SOM, not stop at TAM.
Where does it come up in case interview prep?
- Cracking any estimation promptLesson in Guesstimates and market sizing
- How to use a country in a caseLesson in Markets and economies: the world a case lives in
- Market share, growth, and price elasticityLesson in Business basics for non-business learners
- Private equity and venture capital: players, trends, regulation, and how to crack the casesLesson in Private equity and venture capital
Related terms
- Market sizingEstimating how big a market or quantity is.
- Market shareOur sales as a share of total market sales.
- Penetration rateThe share of potential customers who already use the product.
- Relative market shareOur share divided by the largest competitor's share.
- Share of walletOur share of what one customer spends in the category.
- ARPU (average revenue per user)Revenue divided by the average number of users.
- AOV (average order value)Revenue divided by the number of orders.
- CAC (customer acquisition cost)What it costs, on average, to win one new customer.
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