What it is: SOM represents the portion of the serviceable available market (SAM) a company can realistically capture or penetrate. It considers factors such as competition, market share, and the company's value proposition.
Why it is essential: SOM helps startups assess their market share potential and set realistic growth targets. It provides insights into the level of competition and the feasibility of capturing a meaningful portion of the market.
Formulas: There are no specific formulas associated with SOM.
How to use it in the context of startups: Startups can use SOM to evaluate their market position, set achievable goals, and develop strategies to increase their market share. By understanding SOM, startups can refine their value proposition, differentiate themselves from competitors, and identify opportunities to expand their customer base.