How to Calculate Market Size Without a Panic Attack

Imagine receiving a task from your Head of Something. It sounds pretty like this:

"Dear Marketer (a bit weird, but okay), we have great news! The company is expanding. We have several potential segments to enter, and we need to understand which one to prioritize now and which is for the long term. Give us your expert opinion. Deadline: ideally, yesterday."

Sound familiar? A bit exaggerated, but close to reality.Before you panic about how to calculate market size, take a deep breath. Ask yourself: what is the main criteria C-level executives actually care about when comparing market segments? The answer is always the same: Income.

Once the first wave of frustration fades, you might face new questions:

• What kind of research should I do?

• How much time do I have?

• What if I make a mistake?

How to Calculate Market Size: Step-by-Step Framework

Don't let the panic take over. Drink some water, give your mind a "massage," and let’s move forward with a market-size check. If you’re short on time but need to compare segments by potential profitability, use the SAM (Serviceable Addressable Market) and SOM (Serviceable Obtainable Market) calculation. What does SAM mean in business, how to calculate SOM: these and other critical questions are discovered below.

All you need is LinkedIn Sales Navigator and the framework I’m about to share.

Step 1: Formulate a Clear Goal

It sounds like boring advice, but it's your magic wand. For example: “Decide which market to enter first: Wellness solutions, Pharma solutions, or Dental solutions.”

Step 2: Leverage Your ICPs

Go to your marketing database and find your latest Ideal Customer Profiles (ICPs). Use them as templates to create new ones for the new segments. I recommend using T1–Tn segmentation (Tier 1, Tier 2, etc.) to make your decision more data-oriented.

Step 3: Calculate the SAM (Long-term Perspective)

Extract key data from your ICPs: annual revenue, company headcount, geography (HQ location), and industry. 

Now, go to the Sales Navigator (Account Filters):

1. Input these criteria + write relevant to the industry keywords

2. Note the number of matching companies (e.g., 1,700).

   • Tip: If the number is too small, remove the "Annual Revenue" filter.

3. Apply the formula: 

SAM = Number of Companies * Expected Average Contract Value (ACV)

You can find the expected income/ACV from industry statistic reports or your internal historical data.

Repeat this for each segment and geography. Now you have your SAM and your potential long-term opportunity.

Step 4: Calculate the SOM (Short-term Perspective)

Now, let’s see who is ready to buy right now. In Sales Navigator, add these specific "intent" filters:

• Hiring on LinkedIn

• Funding events in the past 12 months

• Department headcount growth (e.g., 10%+)

These filters reveal companies that are currently growing and likely have the budget for your services.

Tip: If the result is too small (it should ideally be around 20-50% of your SAM), remove the "Funding" filter.

Apply the formula: 

SOM = Number of Companies (with intent filters) * Expected ACV

This gives you the "market temperature." It shows how "ripe" these potential markets are today.

The Summary 

Compare the data for each ICP and geography in monetary terms. Present your review to the team with:

Short-term recommendation (based on SOM).

Long-term perspective (based on SAM).

Monetary justification for your choice.

Now, grab your coffee mug and start creating your market segmentation examples.