Market Sizing Cheat Sheet: Formulas for Every Question Type

Most market sizing questions fall into six repeatable patterns. Recognizing the pattern in the first 10 seconds lets you pull the matching formula off the shelf and start plugging in numbers — no blank-page panic, no wasted setup time. Based on our experience coaching candidates through 500+ mock interviews, pattern-matching is the single highest-leverage skill for estimation questions.

Classify First, Calculate Second

The biggest time sink in market sizing is not arithmetic — it is deciding how to structure the problem. This decision tree reduces that step to under 10 seconds:

flowchart TD
    A[Market Sizing Question] --> B{What are you sizing?}
    B -->|Revenue of a product| C{Physical or digital?}
    B -->|Count of things or people| D["Template #6: Filter Chain"]
    B -->|Revenue of locations| E["Template #3: Unit Economics"]
    C -->|Physical consumer good| F["Template #1: Consumer Product"]
    C -->|Subscription or recurring| G["Template #2: Subscription"]
    C -->|Sold to businesses| H["Template #4: B2B Market"]
    C -->|Ad-supported or platform| I["Template #5: Digital Platform"]

Once you classify the question, grab the matching template below. Each template needs only 3-4 inputs — an anchor number, a penetration rate, and a price or frequency metric.

The Six Templates

Template 1: Consumer Product

Consumer product sizing is the most common estimation pattern in case interviews, covering everything from toothpaste to sneakers.

Formula: Population × Relevant % × Units per Year × Price per Unit

Worked example — US toothpaste market:

Sanity check: $6.3B ÷ 330M = ~$19 per person per year, or about $1.60 per month on toothpaste. Reasonable.

Template 2: Subscription / Recurring Service

Subscription sizing applies to any market defined by recurring payments — streaming services, gym memberships, insurance, SaaS tools for consumers.

Formula: Target Population × Penetration Rate × Monthly Price × 12

Worked example — US gym membership market:

Sanity check: $28B ÷ 260M adults = ~$108 per adult per year. That is $9 per month averaged across all adults including non-members — plausible.

Template 3: Physical Locations

Use this template when the question centers on a chain, store category, or physical infrastructure like gas stations, restaurants, or hotels.

Formula: Number of Locations × Revenue per Location per Year

Worked example — US coffee shop market:

Cross-check from the demand side: roughly 200M US coffee drinkers spending ~$105 per year = $21B. The two approaches converge.

Template 4: B2B Market

B2B sizing replaces consumer headcount with company count. The key variable is adoption rate, which varies widely by product maturity.

Formula: Companies in Segment × Adoption Rate × Annual Contract Value

Worked example — US CRM software market:

When sizing B2B markets, always ask your interviewer whether the scope includes small businesses. This segment can add 30-50% to your estimate.

Template 5: Digital Platform

Digital platform sizing works for ad-supported services, marketplaces, and freemium products where monetization rate is a critical variable.

Formula: Users × Monetization Rate × Revenue per Monetized User per Year

Worked example — US podcast advertising market:

For platform questions, distinguish between total users and monetized users. Many interviewers test whether you recognize this distinction.

Template 6: “How Many of X?” (Filter Chain)

Filter chain sizing applies when the question asks for a count rather than revenue — how many dentists in a city, how many elevators in a country, how many traffic lights in a state.

Formula: Base Population → Filter 1 → Filter 2 → ... → Final Count

Worked example — dentists in New York City:

Sanity check: 5,000 dentists for 8.3M people = 1 dentist per 1,660 residents. The US average is roughly 1 per 1,500 — close enough.

Quick-Reference Card

This table summarizes all six templates in one view — useful for rapid classification during an interview:

Three Sanity Checks You Should Always Run

Every estimate deserves at least one reality check before you present it. In our experience, a 5-second sanity check catches the most common market sizing error — losing a zero:

If your US coffee market estimate works out to $3,000 per person per year, you dropped a decimal somewhere. The per-capita divide reveals this instantly.

Key Takeaways

• Classify your question into one of six patterns before touching any numbers — this eliminates the blank-page problem
• Consumer products, subscriptions, physical locations, B2B, digital platforms, and filter chains cover over 90% of estimation questions
• Each formula requires only 3-4 inputs: a population anchor, a penetration or usage rate, and a price or frequency metric
• Always run at least one sanity check before presenting — the per-capita divide takes 5 seconds and catches zero-dropping errors
• Memorize 10-15 anchor numbers to power every formula (see our full list in Market Sizing Shortcuts)
• Speed comes from pattern recognition, not faster arithmetic — practice classifying questions with market sizing cases in our case library

Ready to test these formulas under realistic pressure? Try an AI Mock Interview that scores your structure and accuracy, or work through our Market Sizing Practice Drills for targeted repetition. For the underlying methodology behind top-down and bottom-up approaches, see our guide on Market Sizing Techniques.