THOUGHTS

Why Keeping Tabs on Your Market Size is Paramount for Business Success

Aug 1, 2018

A thorough market analysis is the cornerstone of success for any marketing campaign or expansion efforts made by a company. Resorting to a bleak alternative of ‘guesswork’ or intuition often proves to have adverse effects. The first step in a b2b market analysis is to identify the market size. When the b2b market size is identified, companies can easily determine how to invest in the R&D budget for the year.

What is b2b market size?

B2B market size refers to the number of individual companies in a market who are potential buyers or sellers of a product or service.  In fact, market size is a key component of strategic marketing planning. Market size is a measurement of the total volume (number of buyers) of a given market. Market size is typically depicted in terms of total people or potential sales volume. It is a quantified value of a designated target.

Importance of b2b market analysis

Having a clear-cut idea of the size of the target market allows companies to fully assess opportunities and accurately plan an approach for investments more wisely. However, a market size calculation alone is not the only factor to be considered while making an investment decision; other research inputs on the strengths and weaknesses, of the competition, anticipated profit margins, and return on capital are essential.

Insights from these market and industry experts help sharpen the estimates and add to the researcher’s wider appreciation of the market.

Competitor analysis

Having a comprehensive understanding of the competitors is critical when determining your market size. Your available market depends significantly on the amount of direct competition you face in your industry. If your competitors deal in products that are outdated, provide terrible customer service, and set higher prices, then you can position against their weaknesses and start attracting some of their customers. On the other hand, if there are a handful of excellent competitors in your space doing lots of things right, it’s going to be harder to break into that market, so you’ll really need to dig into their customer bases and look for areas in their products that fail to meet customer expectations. Your company’s products can be then positioned to win some of those frustrated customers by using the correct marketing mix.

Tips for effective market measurement

There are no hard and fast rules as to how market value needs to be ascertained. Here are some useful tips for companies to determine the size of the market:

  • It is important for companies to conduct both primary and secondary research. Primary research explores the specific aspects of a market that are not addressed without interacting with the parties directly involved. Secondary research, on the other hand, identifies criteria or assumptions on which further analysis is based and points out the gaps that require rectification.
  • Communicate with different audiences that include manufacturers, suppliers, distributors, and end-users. An important but sometimes overlooked group is that of the industry experts who have significant experience in a given market. They can include regulators or legislative bodies, trade associations, or other industry groups.
  • It is important to ensure that all sources are documented so that they can be updated and referred to later.
  • Even in the most comprehensive analysis, there might be some gaps in This requires researchers to display the confidence to make assumptions and to be explicit to decipher the analysis.

For more information on the trends in b2b market size estimation – Request more info.

We help our clients make smarter decisions to achieve rapid business growth

Our strength lies in the unrivaled diversity of our international market research teams, innovative research methodologies, and unique viewpoints that merge seamlessly to offer customized solutions for your every business requirement.

Recent Thoughts

Market Sizing – When is it most effective?

Market Sizing – When is it most effective?

Written By: Gaurav Sharma Overview Market Size of a product/service is necessary for every business. But why? It’s an indicator that can help you assess the profit potential of your business. You always want to be a step ahead of your competitor(s) when doing business...

read more

Insights

Our knowledge hub offers exclusive access to a collection of free resources and downloadable articles that provide insights into market developments and details on how our services can benefit your business.