I once had a conversation with an extremely talented individual from the Value Invest Asia Premium Club on the topic of Total Addressable Market or TAM.
This topic would be broken down into 3 parts: Sizing the TAM, what Phillip Fisher said and what it means for you.
- TAM is the market size of sales of which the company is serving. A Wikipedia entry goes like this
“ Total addressable market (TAM) represents the entire revenue opportunity that exists within a market for a product or service.”
This is the annual revenue of a customer per year. Being addressable, it is really about the audience or customer.
As a member of the Toastmasters club, often we frame a topic as “what is in it for me?” – looking at things through the audience eyes. Effectively, each company should look at things through their customer lens, what is the customer journey?