Total addressable market

A more encompassing variation is to estimate the market size that could theoretically be served with a specific product or service.

This focuses strategic marketing and sales efforts and addresses actual customer needs.

It is important to estimate TAM objectively instead of exaggerating or underestimating this value with subjective attitudes, as it is vital to allocate a suitable market with potential growing capacity.

This is a reasonable deduction, while on the other hand, a high value of TAM is not necessarily a good sign, as the total available market does not mean the high degree of demand obtained.

Hence SAM and SOM are also critical indicators to measure if the market is worth investing.