acalculator

What are my TAM, SAM and SOM?

Enter how many customers are in your market, how many you can serve, what each spends in a year and the share you expect to win. The calculator gives your TAM, SAM and SOM in dollars a year, the three sizes investors and planners ask for.

Your numbers

TAM (total addressable market)
$120,000,000.00

At $120.00 a year per customer, the TAM is $120,000,000.00, the SAM is $24,000,000.00 and the SOM is $1,200,000.00.

SAM (serviceable available market)
$24,000,000.00
SOM (serviceable obtainable market)
$1,200,000.00
SAM as a share of TAM
20%
Customers in the SOM
10,000

TAM (total addressable market): $120,000,000.00. At $120.00 a year per customer, the TAM is $120,000,000.00, the SAM is $24,000,000.00 and the SOM is $1,200,000.00.

The results are estimates for information only. They are not financial, tax, or legal advice. Check the numbers with your lender or a qualified professional before you decide. Terms of use

How to calculate

Computes the total addressable market (TAM), the serviceable available market (SAM) and the serviceable obtainable market (SOM) in dollars a year, from customer counts, yearly revenue per customer and the share you can win.

Example with the default inputs (Customers in the market 1,000,000, Customers you can serve 200,000, Revenue per customer per year $120.00, Share you can win 5%): At $120.00 a year per customer, the TAM is $120,000,000.00, the SAM is $24,000,000.00 and the SOM is $1,200,000.00.

Method: TAM = customers in the market × revenue per customer per year; SAM = customers you can serve × revenue per customer per year; SOM = SAM × share you can win ÷ 100.

  • Every customer spends the same average amount a year, in the whole market and in the part you can serve.
  • The share you can win is your own estimate, for example your revenue last year ÷ your SAM last year.
  • Arithmetic is exact on the typed decimals; money shows to the cent, halves up.

Machine-readable copies: Markdown, JSON.

Worked examples

Each example is checked against the calculator on every build.

  1. Customers in the market 27,790,000, Customers you can serve 20,000,000, Revenue per customer per year $2,500.00, Share you can win 1.25% gives TAM (total addressable market) $69,475,000,000.00, SAM (serviceable available market) $50,000,000,000.00, SOM (serviceable obtainable market) $625,000,000.00, Customers in the SOM 250,000.Source: HubSpot, "TAM, SAM & SOM: What Do They Mean & How Do You Calculate Them?" (TAM = total customers in the market × average yearly revenue per customer; SAM = the customers you can serve × that revenue; SOM = market share × SAM). https://blog.hubspot.com/marketing/tam-sam-som: 27.79 million × $2,500 = $69.475 billion (HubSpot writes $69.47 billion)
  2. Customers in the market 1,000,000, Customers you can serve 200,000, Revenue per customer per year $120.00, Share you can win 5% gives TAM (total addressable market) $120,000,000.00, SAM (serviceable available market) $24,000,000.00, SOM (serviceable obtainable market) $1,200,000.00, SAM as a share of TAM 20%, Customers in the SOM 10,000.Source: HubSpot, "TAM, SAM & SOM: What Do They Mean & How Do You Calculate Them?" (TAM = total customers in the market × average yearly revenue per customer; SAM = the customers you can serve × that revenue; SOM = market share × SAM). https://blog.hubspot.com/marketing/tam-sam-som
  3. Customers in the market 3, Customers you can serve 1, Revenue per customer per year $99.99, Share you can win 0% gives TAM (total addressable market) $299.97, SAM (serviceable available market) $99.99, SOM (serviceable obtainable market) $0.00, SAM as a share of TAM 33.333333%.Source: HubSpot, "TAM, SAM & SOM: What Do They Mean & How Do You Calculate Them?" (TAM = total customers in the market × average yearly revenue per customer; SAM = the customers you can serve × that revenue; SOM = market share × SAM). https://blog.hubspot.com/marketing/tam-sam-som

How it works

With the customers in the whole market N, the customers you can serve S, the average revenue per customer per year R, and the share of the serviceable market you can win s (a percent):

  • TAM (total addressable market) = N × R
  • SAM (serviceable available market) = S × R
  • SOM (serviceable obtainable market) = SAM × s ÷ 100

The page also shows SAM as a share of TAM, S ÷ N × 100, and the customers in the SOM, S × s ÷ 100. All three markets are in dollars a year.

Rules:

  • The customers in the market are a whole number from 1 to 1 trillion, and the customers you can serve a whole number from 0 up to the customers in the market. More customers you can serve than customers in the market gives no answer.
  • The revenue per customer is $0 to $1 billion a year, and the share you can win 0% to 100%.
  • A result too large or too small to show as a number gives no answer.
  • The arithmetic is exact on the numbers you type. Money shows to the cent with halves rounded up (away from 0), the share of TAM to 2 decimals, and the customers in the SOM to the nearest whole customer.

Assumptions

  • Every customer spends the same average amount a year, in the whole market and in the part you can serve.
  • The share you can win is your own estimate. HubSpot estimates it as your revenue last year ÷ your SAM last year.

Worked examples by hand

Luxury women's apparel (HubSpot). N = 27.79 million customers, R = $2,500 a year. TAM = 27,790,000 × 2,500 = $69,475,000,000 (HubSpot writes $69.47 billion). S = 20 million women aged 25 to 65, so SAM = 20,000,000 × 2,500 = $50,000,000,000. With last year's revenue of $500 million against last year's SAM of $40 billion, s = 1.25%, so SOM = 50,000,000,000 × 1.25 ÷ 100 = $625,000,000, from 20,000,000 × 1.25 ÷ 100 = 250,000 customers.

A subscription box. N = 1,000,000, S = 200,000, R = $120, s = 5%. TAM = $120,000,000, SAM = $24,000,000, SOM = 24,000,000 × 5 ÷ 100 = $1,200,000. SAM is 200,000 ÷ 1,000,000 × 100 = 20% of TAM, and the SOM is 10,000 customers.

No share won yet. N = 3, S = 1, R = $99.99, s = 0%. TAM = 3 × 99.99 = $299.97, SAM = $99.99, SOM = $0. SAM is 1 ÷ 3 × 100 = 33.333…, shown as 33.33% of TAM.

Other questions people ask

What are TAM, SAM and SOM?

TAM, the total addressable market, is the yearly revenue if every possible customer bought from you. SAM, the serviceable available market, is the part of the TAM your product, price and reach can serve. SOM, the serviceable obtainable market, is the part of the SAM you can realistically win.

How do I calculate TAM?

Multiply the number of customers in the market by the average yearly revenue per customer. 27.79 million customers who each spend $2,500 a year make a TAM of 27,790,000 × 2,500 = $69.475 billion.

How do I calculate SAM?

Count only the customers you can serve, such as those in your region or price range, and multiply by the same yearly revenue per customer. 20 million customers at $2,500 a year make a SAM of $50 billion.

How do I calculate SOM?

Multiply the SAM by the share of it you expect to win. One way to estimate the share is your revenue last year divided by your SAM last year: $500 million of a $40 billion SAM is 1.25%, and 1.25% of a $50 billion SAM is a SOM of $625 million.

What if I only know the market size in dollars?

Divide the market size by the yearly revenue per customer to get the number of customers, and enter that. A $120 million market where customers spend $120 a year has 1 million customers.

Is this a top-down or a bottom-up market size?

Bottom-up: it builds the market from a count of customers and what each spends. A top-down estimate starts from a published industry total and takes shares of it. Bottom-up numbers are easier to check, because you can see where each one comes from.