TAM, SAM and SOM describe market size in three levels. TAM (total addressable market) is the total revenue theoretically possible with an offering. SAM (serviceable available market) is the part you can actually serve with your offering, channels and region. SOM (serviceable obtainable market) is the share of that you can realistically win in the coming years. The calculator derives all three from your assumptions.
Calculator
How the calculator works
- TAM = potential customers × revenue per customer per year
- SAM = TAM × serviceable share
- SOM = SAM × realistic market share
This is a bottom-up approach. Alternatively, TAM can be derived top-down from market studies; both should lead to a similar order of magnitude.
Example
A fictitious provider of maintenance planning software assumes 2,000 manufacturing plants that could use the product and €12,000 revenue per customer per year: TAM €24 million per year. Selling in the DACH region, it reaches about 30% of these plants: SAM €7.2 million. If it considers 5% of that realistic within five years, SOM is €360,000 per year.
Frequently asked questions
What is the difference between TAM, SAM and SOM?
TAM is the total theoretically possible revenue, SAM the part you can serve with your offering and channels, and SOM the share you can realistically win in the foreseeable future.
Are my inputs stored?
No. The calculator runs entirely in your browser and nothing is sent to us.