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Market Analysisessential

Serviceable Addressable Market (SAM)

The portion of TAM that your product can actually serve given your business model.

Formula
SAM = TAM × Percentage Reachable/Serviceable
Example

If TAM is $10B but you only serve English-speaking markets (40%), SAM = $4B.

Good Range

Should represent realistic near-term opportunity

Warning Range

SAM much smaller than TAM requires expansion plan

Complete Definition

Serviceable Addressable Market (SAM) is the segment of TAM that your product or service can actually reach and serve. It accounts for practical limitations like geography, technology, and business model constraints.

How to Calculate SAM

SAM = TAM × Percentage You Can Actually Serve

Factors That Define SAM

- Geographic reach - Language and localization - Regulatory constraints - Technology requirements - Pricing accessibility - Channel availability - Product capabilities

SAM vs TAM

If TAM is "everyone who could possibly need this," SAM is "everyone we could realistically sell to with our current or planned capabilities."

Example

- TAM: Global CRM market = $50B - Your product: Cloud-based, English-only, SMB-focused - SAM: US/UK SMB cloud CRM = $5B

Why SAM Matters

- More realistic opportunity sizing - Better for strategic planning - Shows market understanding - More credible to investors - Guides go-to-market strategy

Used in:Market AnalysisGo-to-Market Strategy

Related Terms

Total Addressable Market (TAM)
The total market demand for a product or service if 100% market share were achieved.
Serviceable Obtainable Market (SOM)
The realistic share of SAM you can capture in the near term given competition and resources.
Market Share
The percentage of total market sales captured by a company or product.

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