Calculator inputs
Formula used
TAM Buyers = Total Potential Buyers × Target Segment Share
SAM Buyers = TAM Buyers × Reachable Market Share
SOM Buyers = SAM Buyers × Awareness Rate × Conversion Rate × Confidence Adjustment
Annual Customer Value = Average Selling Price × Annual Purchase Frequency
Revenue = Buyers or Active Customers × Annual Customer Value
Gross Profit = Active Customers × (Annual Customer Value − Cost Per Customer)
Projected Active Customers = Previous Active Customers × Retention Rate + New Customers
Projected SAM per Year = Base SAM Buyers × (1 + Growth Rate)Year − 1
How to use this calculator
- Enter the total number of people or businesses that could buy your product.
- Set your target segment percentage to reflect the most relevant customer slice.
- Estimate how much of that segment you can realistically reach.
- Add awareness, conversion, and confidence values to model real go-to-market friction.
- Enter price, purchase frequency, and customer cost to estimate revenue and profit.
- Use growth, retention, and years to build a realistic forward projection.
- Press the calculate button to show the results above the form.
- Download the summary as CSV or PDF after reviewing the tables and chart.
Example data table
| Scenario | Total Buyers | Target % | Reachable % | Awareness % | Conversion % | Price | Frequency |
|---|---|---|---|---|---|---|---|
| Regional wellness app | 500,000 | 18% | 55% | 35% | 10% | $80 | 2 |
| Niche B2B reporting tool | 120,000 | 12% | 60% | 28% | 14% | $240 | 3 |
| Direct-to-consumer kitchen product | 900,000 | 20% | 45% | 32% | 8% | $65 | 2 |
Frequently asked questions
1. What does TAM mean?
TAM is the total addressable market. It estimates the full demand for your product if every ideal buyer in the chosen segment purchased from you.
2. What does SAM represent?
SAM is the serviceable available market. It narrows TAM to the buyers you can realistically reach with your geography, channels, product fit, and operations.
3. What is SOM in this calculator?
SOM is the serviceable obtainable market. It reflects realistic near-term capture after accounting for awareness, conversion limits, and your confidence adjustment.
4. Why include a confidence adjustment?
Confidence adjustment reduces overly optimistic assumptions. It helps you stress-test the model when your survey data, channel performance, or market signals are still uncertain.
5. Why does retention matter?
Retention affects future active customers and revenue. Higher retention compounds value over time, while weak retention can shrink growth even with strong new customer acquisition.
6. Can I use this for B2B markets?
Yes. Replace consumers with accounts, firms, stores, or teams. Use account-level pricing, purchase frequency, conversion assumptions, and reachable market estimates.
7. Should I use annual revenue or one-time revenue?
Use annual revenue when customers buy repeatedly or renew subscriptions. For one-time products, set purchase frequency to one unless repeat purchases are expected.
8. How accurate are the results?
The output is only as strong as your assumptions. Use customer research, historical sales data, channel benchmarks, and scenario testing to improve reliability.