Total market potential

certified ManagementGoeroes expert badge
1 min read

The total market potential is the maximum turnover that is available to all companies in an industry during a fixed period. Considering that the level of marketing and environmental factors are fixed. A common way to calculate the total market potential is using the following formula as follows:

MP = NxQxP

  • MP = the total market potential
  • N = the number of buyers in a specific product / market with fixed assumptions
  • Q = number of products purchased by an average buyer
  • P = price of an average product

So if 100 million people buy a book every year, and the average buyer buys three books a year, and the average price of a book is ten dollars, then the total market potential for books is three billion dollars.

(source: Free translation to Philip Kotler, Marketing Management, 1997. P. 135.)

Article rating: 2.4 (15 reviews)
Share this article

Related articles

Show more

Popular articles

Show more

Latest Articles

Show more
Direct contact with a business coach
Rick De Vlieger
Rick De Vlieger
€ 0,05 pm
Online marketeer
I'm the ONE Who knows about management & online marketing strategy. Call me for free!
Milagros Agustina Blache
Milagros Agustina Blache
€ 0,10 pm
I teach English
I'm the ONE I' the ONE who can teach you speak properly english or spanish.
Sara  Betancur
Sara Betancur
€ 0,10 pm
Management engineer
I'm the ONE fun and easygoing latin girl who enjoy teaching. I'd love to speak with you!
Andreea Georgiana
Andreea Georgiana
€ 0,05 pm
business analyst
I'm the ONE who knows how to live in full bloom how to feel better shows you places
Srikanth Reddy
Srikanth Reddy
€ 0,17 pm
dj, engineer
I'm the ONE Sri - care of happiness