A typical question from an investor is to ask you “How big is your market?”. First, we need to agree that you can never size a market in Excel, however I think there is a good way to get a sense of the demand for your product in advance.
Let’s say you want to start a website that sells Tents in UK. You sell each tent for 50 pounds. Now I want to estimate the market size. What I’ll do is, estimate the number of times people searched for the term Tent Sale. How?
Click on this link and do the following steps:
So there are 33,000 people searching for Tent Sale every month in UK. That means if you sell to all of them you’ll make (50 x 33,000) 1.65M pounds per month, that’s almost 20M pounds per year. Of course the estimation are not perfect, but at least now you have a much better idea on how big your business might endup being.
Go ahead give it a try, it’s fun. I just found out that people are searching for Justin Bieber two times more than Lady Gaga!