Target Market

Describing the target market is most commonly broken down into:

  • Total Available Market (TAM) – how many customers have the problem that you are solving, or how much money is being spent to solve the problem.
  • Serviceable Available Market (SAM) – What is the proportion of the market which is accessible to you (for example geographically, or technically) and that isn’t already fully satisfied by an alternative solution.
  • Share Of Market (SOM) – How much of this market can you expect to obtain. This may be limited by market economics, production volumes, level of competition etc.

The Target Market is then the proportion of the SOM that are being sold to at a particular point in time. You may be targeting a small number of early adopters through conferences and seminars, or there may be a subset of the market that are particularly easy to reach through a particular channel (such as TikTok users).

Market traction is then how well that target market is responding to your efforts to publicise or sell your solution and is an indicator of whether you have the correct product-market fit, and whether you are adequately communicating that to the target market.