Understanding TAM, SAM, and SOM: A Practical Guide for Sizing Business Opportunities

Every business leader has wrestled with the same question: “How big is our real opportunity?” Whether you’re a CEO planning the next stage of growth, a marketing leader building a new product strategy, or a business owner looking to justify investment, understanding the size of your market is essential. It’s not just about dreaming big—it’s about setting realistic expectations and focusing resources where they’ll make the most impact.

This is where the concepts of Total Addressable Market (TAM), Serviceable Available Market (SAM), and Serviceable Obtainable Market (SOM) come into play. These three tools allow you to map out the opportunity landscape, distinguish between what’s possible and what’s practical, and help ground your business plan decisions.