Before launching a new product or service, every company should research the size of its market.
Take toothbrushes, for example.
Your market size will be pretty significant, as everyone (hopefully) brushes their teeth. If you narrow your market down to those who use electric toothbrushes, your market size will become smaller.
Understanding market size also helps businesses distinguish between two categories: the addressable market and the available market.
The total amount of money you can make from your product or service is called the addressable market. The available market is the part of the addressable market where you can realistically compete.
By defining the market size, you can assess opportunities, plan research and development, and understand the growth level needed to hit your goals.