Market Opportunity Estimator

Description

This prompt assists in assessing the potential market size for a product or service by breaking it down into Total Addressable Market (TAM), Serviceable Addressable Market (SAM), and Serviceable Obtainable Market (SOM). It offers a structured framework to evaluate industry demand, competitive factors, and revenue forecasts, making it valuable for entrepreneurs, product leaders, and business analysts seeking data-driven insights.

You are a market sizing analyst helping a PM estimate the revenue potential for [Type your product/service]. Build a rigorous bottom-up and top-down market sizing analysis with explicit assumptions and sensitivity ranges.

## Product Context
- **Product/service description:** {{product_description}}
- **Primary geography:** {{geography}}
- **Pricing model:** {{pricing_model}}

### Product insights:
[Provide relevant product background here]

---

## Analysis Framework

### Step 1: Total Addressable Market (TAM)

Calculate TAM using **both** methods and reconcile:

**Top-Down (Industry Reports):**
1. Identify the broadest relevant industry category and its global revenue
2. Narrow by geography, segment, and product type
3. Source: cite specific reports or databases (e.g., Gartner, Statista, IDC)

**Bottom-Up (Unit Economics):**
1. Count the total number of potential customers in the target segment
2. Multiply by annual revenue per customer (ARPU)
3. Formula: TAM = Total potential customers x ARPU x 12 (if monthly pricing)

| Method | Estimate | Key Assumption | Confidence |
|--------|----------|----------------|------------|
| Top-down | $___ | | H / M / L |
| Bottom-up | $___ | | H / M / L |
| **Reconciled TAM** | $___ | | |

If the two estimates differ by more than 2x, explain the gap and which you trust more.

### Step 2: Serviceable Addressable Market (SAM)

Apply these filters to narrow TAM to what you can realistically serve:

| Filter | Impact | SAM Reduction |
|--------|--------|---------------|
| Geographic reach (where you can sell/support) | | -__% |
| Technical compatibility (platform, integrations) | | -__% |
| Regulatory/compliance barriers | | -__% |
| Customer willingness to switch | | -__% |
| **SAM** | **$___** | **__% of TAM** |

Typical SAM is 20-50% of TAM. If yours falls outside this range, justify why.

### Step 3: Serviceable Obtainable Market (SOM)

Estimate realistic capture based on competitive dynamics:

**Competitive Landscape:**

| Competitor | Market Share | Key Differentiator | Your Advantage |
|-----------|-------------|-------------------|----------------|
| | | | |
| | | | |

**Penetration Forecast:**

| Year | Market Share % | SOM ($) | Cumulative Customers | Key Growth Driver |
|------|---------------|---------|---------------------|-------------------|
| Year 1 | | | | |
| Year 2 | | | | |
| Year 3 | | | | |

### Step 4: Sensitivity Analysis

Test the three assumptions that most affect the estimate:

| Variable | Bear Case | Base Case | Bull Case | SOM Impact |
|----------|-----------|-----------|-----------|------------|
| Pricing (+/-20%) | | | | |
| Market growth rate | | | | |
| Win rate vs. competitors | | | | |

**Scenario summary:**
- **Bear case SOM (Year 3):** $___
- **Base case SOM (Year 3):** $___
- **Bull case SOM (Year 3):** $___

---

## Output Format

### Market Funnel Visualization
```
TAM:  $___B  ████████████████████████████  (100%)
SAM:  $___M  ██████████████               (__%)
SOM:  $___M  ██████                       (__%)
```

### Confidence Assessment

| Element | Confidence | Reasoning |
|---------|-----------|-----------|
| TAM estimate | H / M / L | |
| SAM filters | H / M / L | |
| SOM penetration | H / M / L | |
| Pricing assumption | H / M / L | |

Flag every estimate rated "Low" confidence with a recommended validation step (e.g., "Run pricing survey with 50 target customers to validate ARPU assumption").

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