SOM (Serviceable Obtainable Market)
SOM, or Serviceable Obtainable Market, is a business term referring to the realistic market reach of a company or product.
Definition
SOM, or Serviceable Obtainable Market, is an economic term that refers to the portion of the total market that a company or product can realistically reach. This includes considering factors such as geographic reach, distribution capabilities, price point, and competition.
Usage and Context
SOM is often used in business planning and strategy development. It helps businesses identify their potential market share and size their operations appropriately. It is a subset of the Total Addressable Market (TAM) and the Serviceable Available Market (SAM). While TAM refers to the total market demand for a product or service, SAM represents the segment of TAM targeted by your products and services which is within your geographical reach. SOM, however, is the portion of SAM that you can realistically serve.
FAQ
What is the importance of SOM?
SOM is crucial for businesses as it helps them understand their realistic market reach. It helps in strategic planning and resource allocation.
How is SOM calculated?
SOM is calculated by assessing the company's resources, capabilities, and competition in the target market.
Related Software
There are several market analysis software like Nielsen, MarketSight, and Statista that can help in calculating and analyzing SOM.
Benefits
Identifying SOM helps businesses in strategic planning, resource allocation, and risk management. It also assists in setting realistic sales targets and optimizing marketing strategies.
Conclusion
Understanding SOM is vital for any business to realistically understand its potential reach and to strategize accordingly. It forms a crucial part of market analysis and business planning.
Related Terms
SaaS (Software as a Service)
SaaS is a cloud computing model that delivers applications over the internet, eliminating the need for local installation and maintenance.
SaaS Customer Lifecycle
The SaaS Customer Lifecycle refers to the customer's journey with a SaaS company, from acquisition to referral. It's crucial for customer engagement strategies.
SAL (Sales Accepted Lead)
A Sales Accepted Lead (SAL) is a prospective customer vetted by marketing and sales teams and considered ready for the next sales stage.
Sales Automation
Sales Automation is a process leveraging software to streamline and automate routine sales tasks, improving efficiency and productivity.
Sales Channel
A sales channel is the path a product or service follows from the producer to the end user. It is crucial in reaching target customers and expanding market reach.
Sales Funnel
A sales funnel is a model that illustrates the journey of a customer towards the purchase of a product or service.
Sales Funnel Integration
Sales Funnel Integration is the process of combining and optimizing marketing and sales strategies to guide leads to becoming loyal customers.
Sales Marketing
Sales Marketing is a business strategy that integrates sales techniques with marketing strategies to effectively communicate the benefits of a product or service to potential customers.
Sales Pitch
A sales pitch is a persuasive explanation of a product's or service's value, aimed at initiating and closing a sale.
