Using Data To Assess Ecommerce Market Viability

I’m going to break down a classic framework here. Here’s how I look at estimating your total number of paying customers. If you have an e-commerce business you should pay attention. Learn how to sharpen these numbers to light the path to profitability and growth opportunities. Size up your total market potential. Zoom in on realistic demand. Converting interest into revenue. Market sizing - it's an integral part of the strategic conversation whenever we're assessing a business concept or mapping growth. I want to dig deeper into the classic breakdown - TAM, SAM, and SOM. These acronyms may seem abstract but really nailing down estimates guides decisions and sets expectations. First, TAM - the total addressable market. This bird's-eye view represents the absolute ceiling of potential customers. For a behemoth like Facebook, TAM encompasses essentially everyone on the planet. Less universal ideas have more contained TAMs, but it's still an expansive perspective. Then we have SAM - the serviceable addressable market. Here we narrow down to the segments we can readily capture based on geography, demographics, our business model and capabilities. SAM analysis spotlights untapped pockets within TAM to inform expansion decisions. Finally, SOM brings it to the bottom line - the serviceable obtainable market of likely buyers who'll actually convert. We size this through data analysis and projections of consumer behavior. Realistic SOM forecasting is critical for financial modeling and carving an achievable path to profitability. These market lenses enable some key strategic planning: First and foremost, gap analysis between SOM and higher levels grounds viability. A wide gulf exposes flawed assumptions or a non-starter idea. Secondly, SOM drives revenue planning through pricing optimization and customer LTV modeling based on purchase cycles. We expand transaction volume and wallet share over time. And thirdly, the distance between SOM, SAM and TAM informs go-to-market prioritization and growth capital allocation as we stair-step to scale. Of course, market estimation isn't an exact science. But refined TAM, SAM and SOM analysis, updated iteratively as data flows, provides essential guidance for startups through established players alike. I’d love to hear your thoughts and experiences leveraging sizing estimates to steer strategy. What challenges have you run into?

Looking to expand and discover new opportunities? Start by doing a thorough market analysis.  Whether you're looking to enter new markets or expand into new categories, market analysis is extremely useful. Here's how you can use it: 1. To understand market demand by recognizing emerging trends and shifts in consumer behavior. 2. To analyze reviews and purchasing patterns to tailor your offerings. 3. To study your competitors' strengths and weaknesses to identify market gaps. 4. To compare your products with others to improve your value propositions. 5. To conduct market entry feasibility studies to assess market size, growth potential, and entry barriers. 6. To identify risks and develop mitigation strategies. 7. To pinpoint regions with high demand and low competition through regional analysis. 8. To understand cultural preferences and local regulations for proper localization. 9. To develop new products based on customer needs and potential for new categories. 10. To optimize your marketing strategies to reach new markets effectively. Market analysis provides essential insights for e-commerce brands to make informed decisions, minimize risks, and succeed in new markets or categories. How has market analysis helped you discover new opportunities?

Today, I’m diving into 𝐇𝐞𝐥𝐢𝐮𝐦 𝟏𝟎’𝐬 𝐗𝐫𝐚𝐲 𝐭𝐨𝐨𝐥 and how it can drive growth through 𝐩𝐫𝐨𝐝𝐮𝐜𝐭 𝐚𝐧𝐝 𝐦𝐚𝐫𝐤𝐞𝐭 𝐫𝐞𝐬𝐞𝐚𝐫𝐜𝐡. 🔍 Xray is invaluable for: ▪️ Identifying opportunities to launch new variations or products ▪️ Ensuring competitive and profitable pricing ▪️ Understanding market dynamics to make data-driven decisions 𝟏. 𝐀𝐧𝐚𝐥𝐲𝐳𝐢𝐧𝐠 𝐕𝐚𝐫𝐢𝐚𝐭𝐢𝐨𝐧𝐬 𝐚𝐧𝐝 𝐌𝐚𝐫𝐤𝐞𝐭𝐬 💡 When deciding whether to launch a new variation, it’s critical to evaluate the market size and profitability. For example, looking at allulose, Xray revealed: ▪️ A $3M+ market size ▪️ 72% margins before factoring in COGS and ad spend With healthy margins, there’s clear potential to enter this space, provided your costs remain in check: ▪️ Keep COGS around 20–30% ▪️ Allocate ads at 40–50% This leaves enough room for profitability while driving paid traffic to generate organic sales and reviews. 𝟐. 𝐓𝐮𝐫𝐧𝐢𝐧𝐠 𝐈𝐧𝐬𝐢𝐠𝐡𝐭𝐬 𝐢𝐧𝐭𝐨 𝐀𝐜𝐭𝐢𝐨𝐧 💫 Xray enables you to: ▪️ Validate whether a product or variation is worth launching ▪️ Set competitive pricing that ensures profitability ▪️ Push paid ads confidently, knowing your margins can support growth Check out the full video here: https://lnkd.in/emR6PuH4 #Amazon #helium10 #digitalmarketing #ecommrece #digitaladvertising