strategy to approach market size

Question

hi there,

for this question we are asked to calculate the current market for IBC.

in normal situations in market sizing, we draw our own structure and then include assumptions to then estimate market sizes independently. In this case there is data available on the male female and teenager markets.

How would I know when to perform the market sizing independently or when i would need to ask for data? I thought that you do the market sizing without external data and you make logical assumptions or use previous data provided from the clarifications in the first part of the case. however if I do this in this case, my structure is different because i am estimating market sizes without product pricing data etc.

please see https://www.preplounge.com/en/consulting-forum/market-sizing-ask-interviewer-for-data-points-first-or-develop-own-structure-and-present-for-initial-review-16785 for comparison.

i am new to preplounge so sorry for bad english because i am not native english speaker.

many thanks and I hope to ask more questions in this community!

Answer 1

Hi there!

Basically, you should develop an independent approach. This means that you should have a step by step approach to the market sizing exercise that will lead you to the answer.

What you will be missing are the actual numbers / the inputs to then plug into this approach.

You should always first ask whether these inputs are already available. If not, offer to make an assumption. Then explain what your assumption is based on and what is the degree of confidence that you have in that assumption.

Lastly, at the end, when you interpret the result of the market sizing exercise, make sure to highlight the key assumptions that you've taken and what would be the next steps to take in order to increase your level of confidence in them.

Best,
Cristian

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Answer 2

Hi there,

Your English is excellent! You should feel great about it!

So, in most instances you need to market size based on your own estimates and undestanding of the world. Remember, you are estimating NOT guessing.

In some instances the interviewer will provide you with data, but you should go in assuming they will not!

If you would like some more practice + explanation, feel free to check out these market sizing answers I've created (including the video walkthroughs!):

https://www.preplounge.com/en/management-consulting-cases/candidate-led-usual-style/advanced/market-sizing-with-solution-number-of-internet-users-319

https://www.preplounge.com/en/management-consulting-cases/candidate-led-usual-style/beginner/market-sizing-with-solution-number-of-taxis-317

https://www.preplounge.com/en/management-consulting-cases/candidate-led-usual-style/intermediate/market-sizing-with-solution-coffee-shop-revenue-318

Answer 3

In a real interview, you state how you would do it in an independent way.

If the interviewer has relevant information he/she will let you know.

Of course, you can state your approach and then ask whether the interviewer has relevant information or you should use your own assumptions.