Learn Consulting Market Sizing in 7 Minutes

Market sizing questions are very common in consulting interviews. This video will provide you with a market sizing framework to tackle any market sizing case or question. We'll go through several examples of market sizing practice questions and provide answers to them.

You’ve probably heard of one of the most famous consulting case interview market sizing questions before: how many golf balls can fit in a Boeing 737?

At first glance, this might seem like a ridiculous question. Why would a consulting interviewer care whether or not you can estimate the number of golf balls that can fit in an airplane? What does this have anything to do with consulting, business, or one’s intelligence?

At the end of the day, for market sizing and estimation questions in consulting interviews, interviewers don’t care about the exact answer you give. Whether your answer is correct or off by orders of magnitude, interviewers use these types of questions to assess three things. Interviewers want to see you structure an approach to the problem, execute on the math correctly, and clearly communicate and walk them through your work.

[virageist]

The golf ball example is so much easier in metric

[judyl.]

0:06 one of the famous consulting case interview: market sizing/ estimation
0:28 the question is related to consulting, business, intelligence.
0:52 assess on 3 points: 1. structure an approach; 2. execute on math; 3. communicate
1:10 the approach: 1. structure an approach 2. perform calculations 3.walk interviewers through each step
1:28 market size = total dollars of sales in one year for a particular service and product.
1:35 structuring an approach: is the hardest part.
1:50 requires: logic and creative brainstorming.
2:24 how much cell phone insurances cost per year, and we will multiply all these figures to get market size.
3:31 we might estimate the cell phone insurance costs $25 per month, or $300 a year.
2:56 the most common math mistakes: decimal points and missed zeros.
3:44 give us a market size of $24.3 Bn
4:01 communication.
4:16 if the interviewer eyes closed, they can follow your math and know exactly how you doing it.
6:42 whether this answer is correct or not, is not matter.
5:24 4/3 = 4 over 3 = 4 divided by 3
5:27 radius ^3 = radius cubed
5:34 sphere 球型; the volume of its sphere.
5:40 let's convert it into feet since we're likely to use feet as a unit
6:14 volume = L*W*H = 10, 000 feet
6:23 let's also assume 20 percent of the airplane volume is occupied by seats and furniture.
6:28 so we actually have 8, 000 cubic feet on the airplane.
---
一億: 100 mn
十億: 1bn
---
term:
0:40 order of magnitude (尤指數字的)數量級，大小.
1:47 make-or-break situation: 要麼（either）极度成功，要麽（or）彻底失败

[uv]

there is one big problem with this examples. you do not give any logical explanation to your assumptions. you can just assume that the annual cost of cellphone insurance is 300$. even if that's true, you have to explain why you choose this number. for example: A flagship phone costs 1, 000$. mostly, people who bought flagship phone will buy insurance. 300$ is roughly 1/3 of the price, hence I chose this number.

other then that I liked you video. thank you!

[micromania]

the plane case is insanely difficult, i dont think interviewers would come up with that bu always good to see it live

[ZOZKSABOY]

It's a shame to see this type of content with fewer views. What a great explanation and layout for answering market sizing questions

[MJ-mqqh]

Thank you, your explanation is so easy to understand and it is very helpful .

[lorenzofongponce]

Recently did a market sizing question for a FAANG company and I think the phone insurance example would get nitpicked a lot by interviewers!


1. Why assume 90% of people have cell phones? How about people who own multiple cellphones? How about people who buy cycle through one or more cellphones per year?


2. Does it make sense that almost 1 in 3 people who own a cellphone would buy cellphone insurance? Why 30%? On what grounds was that assumption made?


3. Is the insurance for a flagship Apple phone and a second-hand 2013 phone both $25 a month? Why does that make sense?


Especially for jobs that require a lot of deep diving and sanity checks, although it's true that in the end the exact numbers don't matter, I'd imagine they definitely do want a bit more nuance

[technologyandinnovation]

Stick with either 747 or 737 during the interview. Don't change plane because there size is significantly different.

[prachijain]

how did you assume 90% has cellphones and then same question for other assumptions after that ?

[randym]

Just wondering how to do the pen writing animation? Is it standard in power point?

[JosefinaUgarte]

I didn't get how you estimated the annual costs of the insurance. Why $300 dollars per year?

[ElvisSCL]

1:27 Do not assume anything! This is a big mistake during interview. ASK if this this number of insurance sold or revenue.

[davidbuenomartinez]

The solution in the formula in 5:25 must be done mentally? Is a calculator allowed?

[piyushsingh]

a correction in the first sentence, the picture that you drew represent a B747(jumbo jet with a hump) and not B737

[chauchau]

6:37, you did not eliminate the empty gap space between balls. I assume it's 5%.

[No-shvs]

How did you get from 1728 cubic inches to 0.001 cubic feet?

[santhosh]

What if don't know the formula of volume during interview ?

[ginevrafratto]

why do you estimate that 30% of people will get an insurance? what is the logic behind?