Market Analysis Patterns

Frameworks for sizing markets, analyzing competition, and understanding industry dynamics.

TAM SAM SOM Framework

Market sizing from total opportunity to achievable share.

Definitions

┌─────────────────────────────────────────────────────────┐ │ TAM │ │ Total Addressable Market │ │ (Everyone who could possibly buy) │ │ ┌───────────────────────────────────────────────────┐ │ │ │ SAM │ │ │ │ Serviceable Addressable Market │ │ │ │ (Segment you can actually reach) │ │ │ │ ┌─────────────────────────────────────────────┐ │ │ │ │ │ SOM │ │ │ │ │ │ Serviceable Obtainable Market │ │ │ │ │ │ (Realistic share you can capture) │ │ │ │ │ └─────────────────────────────────────────────┘ │ │ │ └───────────────────────────────────────────────────┘ │ └─────────────────────────────────────────────────────────┘

Metric Definition Example

TAM Total market demand globally All project management software: $10B

SAM Your target segment Enterprise PM software in North America: $3B

SOM What you can realistically capture First 3 years with current resources: $50M

Calculation Methods

Top-Down Approach:

TAM = (# of potential customers) × (annual value per customer) SAM = TAM × (% addressable by your solution) SOM = SAM × (realistic market share %)

Bottom-Up Approach:

SOM = (# of customers you can acquire) × (average deal size) SAM = SOM / (your expected market share %) TAM = SAM / (segment % of total market)

Example Analysis

Market Sizing: AI Code Review Tool

TAM (Total Addressable Market)

• Global developers: 28 million
• % using code review tools: 60%
• Addressable developers: 16.8 million
• Average annual spend: $300/developer
• TAM = $5.04 billion

SAM (Serviceable Addressable Market)

• Focus: Enterprise (>500 employees)
• Enterprise developers: 8 million (48% of addressable)
• Willing to pay premium: 40%
• Target developers: 3.2 million
• SAM = $960 million

SOM (Serviceable Obtainable Market)

• Year 1-3 realistic market share: 2%
• SOM = $19.2 million

Porter's Five Forces

Analyze industry competitive dynamics.

The Five Forces

                ┌─────────────────────┐
                │  Threat of New      │
                │     Entrants        │
                │    (Barrier height) │
                └─────────┬───────────┘
                          │
                          ▼

┌─────────────────┐ ┌─────────────────┐ ┌─────────────────┐ │ Bargaining │ │ Competitive │ │ Bargaining │ │ Power of │◄───│ Rivalry │───►│ Power of │ │ Suppliers │ │ (Intensity) │ │ Buyers │ └─────────────────┘ └─────────┬───────┘ └─────────────────┘ │ ▼ ┌─────────────────────┐ │ Threat of │ │ Substitutes │ │ (Alternative ways) │ └─────────────────────┘

Force Analysis Template

Porter's Five Forces: [Industry]

1. Competitive Rivalry

Intensity: HIGH / MEDIUM / LOW

Implications: [How this affects strategy]

2. Threat of New Entrants

Threat Level: HIGH / MEDIUM / LOW

Implications: [How this affects strategy]

3. Bargaining Power of Suppliers

Power Level: HIGH / MEDIUM / LOW

Implications: [How this affects strategy]

4. Bargaining Power of Buyers

Power Level: HIGH / MEDIUM / LOW

Implications: [How this affects strategy]

5. Threat of Substitutes

Threat Level: HIGH / MEDIUM / LOW

Implications: [How this affects strategy]

Overall Industry Attractiveness

Score: X/10 [Summary and strategic recommendations]

Competitive Analysis

Competitive Landscape Map

                HIGH PRICE
                    │
     Premium        │        Luxury
     Leaders        │        Niche
┌─────────────┐     │     ┌─────────────┐
│  [Comp A]   │     │     │  [Comp B]   │
└─────────────┘     │     └─────────────┘
                    │

LOW ────────────────────┼──────────────────── HIGH FEATURES │ FEATURES │ ┌─────────────┐ │ ┌─────────────┐ │ [Comp C] │ │ │ [US] │ └─────────────┘ │ └─────────────┘ Budget │ Value Options │ Leaders │ LOW PRICE

Competitor Profile Template

Competitor: [Name]

Overview

• Founded:
• Funding:
• Employees:
• Revenue (est):

Product

• Core offering:
• Key features:
• Pricing:
• Target customer:

Strengths

Weaknesses

Recent Moves

Threat Assessment: HIGH / MEDIUM / LOW

SWOT Analysis

┌─────────────────────────┬─────────────────────────┐ │ STRENGTHS │ WEAKNESSES │ │ (Internal +) │ (Internal -) │ ├─────────────────────────┼─────────────────────────┤ │ • What we do well │ • Where we lack │ │ • Unique resources │ • Resource gaps │ │ • Competitive advantages│ • Capability limits │ │ │ │ ├─────────────────────────┼─────────────────────────┤ │ OPPORTUNITIES │ THREATS │ │ (External +) │ (External -) │ ├─────────────────────────┼─────────────────────────┤ │ • Market trends │ • Competitive pressure │ │ • Unmet needs │ • Regulatory changes │ │ • Technology shifts │ • Economic factors │ │ │ │ └─────────────────────────┴─────────────────────────┘

SWOT to Strategy (TOWS Matrix)

Strengths Weaknesses

Opportunities SO Strategies: Use strengths to capture opportunities WO Strategies: Overcome weaknesses to capture opportunities

Threats ST Strategies: Use strengths to mitigate threats WT Strategies: Minimize weaknesses and avoid threats

Market Considerations

• Geopolitical factors: Trade restrictions impact SAM significantly

• AI disruption: Every market being reshaped by AI capabilities

• Sustainability: ESG factors increasingly influence buying decisions

• Remote-first: Geographic boundaries less relevant for digital products

Related Skills

• product-strategy-frameworks

• Strategic decisions based on market analysis

• business-case-analysis

• Financial implications of market opportunities

• okr-kpi-patterns

• Measuring market penetration

References

• TAM SAM SOM Calculator

• Competitive Intelligence Template

Version: 1.0.0 (January )