Market Core · Market Opportunities · Module
Sizing
How large the opportunity actually is, built from the bottom up and stated as what is reachable rather than what exists.
The idea
How it works
Top-down sizing takes a category figure and applies a percentage nobody can defend. Bottom-up sizing counts units — how many customers, buying how often, at what price — and produces a number that can be argued with, which is its whole value.
The reachable market is the one that matters. Total category size flatters and decides nothing; what the organisation could actually serve given its channels, geography and capacity is the figure every downstream decision rests on.
Working with it
In practice
- 01
Build from units, not from percentages
Customers times frequency times price. A number assembled from a share of a report cannot be checked and is usually wrong.
- 02
State all three sizes
What exists, what you could serve, and what you could realistically win. Reporting only the first is the standard error.
- 03
Write the assumptions next to the number
Every sizing rests on three or four estimates. Without them nobody can tell which one broke when the number turns out wrong.
- 04
Sanity-check against something known
Compare the implied share, revenue per customer or unit volume with a business you can observe. Implausible implications show up immediately.
One level in
The components of sizing
A component is something that exists afterwards which did not exist before — a deliverable or a mechanism, not an intention.
Check what the number implies — share, revenue per customer, unit volume. Implausible implications surface immediately.
The other modules in market opportunities
Growth and direction
Where the demand is heading and what is driving it — because a shrinking large market and a growing small one call for opposite decisions.
LearnOpportunity assessment
Attractiveness and fit, judged separately — because a large growing market the organisation has no right to win is not an opportunity for it.
LearnThe shortlist
What the organisation has decided to pursue and what it has decided not to — both dated, because both will be revisited by someone who was not there.
Learn