Free tool
TAM SAM SOM Calculator
TAM SAM SOM splits your market into three circles: the whole market, the part your offer can serve, and the part you can actually win. Start from the number of customers and what each spends per year: every assumption stays visible and open to discussion.
TAM (Total Addressable Market) is the revenue possible at 100 % market share, as if no competitor existed. SAM (Serviceable Available Market) is the part of the TAM your offer can serve. SOM (Serviceable Obtainable Market) is the part of the SAM you can realistically win.
Your Market Is There. What About Your Customers?
The SOM tells you how many customers are within reach. Campaigns decide how fast you win them, and at what cost.
20 minutes · No commitment · 100% confidential
How the three circles are calculated
TAM = Potential customers × Annual spend SAM = TAM × Share served SOM = SAM × Share won
150,000 potential customers spending 4,000 € a year give a TAM of 600 million euros. If your offer serves 30 % of them, the SAM is 180 million. Winning 5 % gives a SOM of 9 million, or 2,250 customers.
The TAM gives the scale, the SOM gives the target. Between the two, the two percentages carry the whole assumption: moving from 5 % to 10 % share won doubles the SOM, with the same market.
On the advertising side, the SAM works as a guardrail: it tells you which population to focus your campaigns on. Targeting wider than your SAM buys visits from people your offer does not serve.
What the calculation lets you do
- Present your market in a business plan or to a partner, with assumptions anyone can check.
- Set a realistic customer target, based on the SOM rather than the TAM.
- Draw the edges of your ad targeting around the population of your SAM.
Frequently asked questions
How do you calculate TAM SAM SOM?
Multiply potential customers by their annual spend for the TAM, apply the share your offer can serve for the SAM, then the share you can win for the SOM. 150,000 × 4,000 € = 600 M€, × 30 % = 180 M€, × 5 % = 9 M€.
What is the formula for market size?
Market size = number of potential customers × average annual spend per customer. That product is your TAM; the SAM and SOM narrow it down to what you can serve and win.
What is the difference between TAM, SAM and SOM?
TAM is the whole market at 100 % share. SAM is the part your offer can serve, depending on your area, language or customer type. SOM is the part of the SAM you can realistically win against competitors.
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