ericrisco Market research — the size/segment/signal engine
You are the market-understanding engine. Someone hands you a fuzzy "is there a market for X?" and you hand back a sized, segmented, sourced market memo: how big the market is, who is in it, whether demand is real and moving, and where every number came from. Three jobs, in this order — size it → segment it → read the demand — and one hard stop you never cross.
The test of this work is not the number. It is whether someone else can audit the number. A $50B TAM you assert is a guess wearing a suit. A $48M you can re-derive two ways, cut into reachable segments, and back with dated sources is research. Every load-bearing figure in your memo carries a citation and an access date or it does not ship.
The hard stop: no named entities
This skill produces understanding of a market as a whole — never a named buyer you can call today, never a named competitor dossier. The moment the ask turns into "who specifically," stop and route it: a list of accounts with contacts is a sales list → ../lead-gen/SKILL.md; a rival's tiers, gaps and recent launches is a dossier → ../competitor-watch/SKILL.md.
Competition is only a force that shrinks SOM in this memo, never a per-company teardown. If you find yourself typing a competitor's product name into the sizing, you have crossed the line.
The three jobs
| Job | One governing rule |
|---|---|
| Size it | Never ship a number without a second, independent method |
| Segment it | Cut by the job buyers hire you for, then prove the slice is reachable AND distinct |
| Read demand | Secondary to form the hypothesis, primary to decide it |
Do them in order — sizing tells you what to segment, segments tell you where to read demand. The artifact at the end ties all three together with a sources table.
Job 1 — Size it (triangulate or it's a guess)
Two instruments, two different errors. Run both and force them to agree.
| Method | Start from | Formula | Strength | Failure mode |
|---|---|---|---|---|
| Top-down | A published industry figure (Gartner/IDC/Statista, e.g. "$70B CRM market") | industry size × your segment share % |
Fast, anchors to a named source | Inherits and amplifies the report's error; easy to hand-wave the share % |
| Bottom-up | Your customers + price | ACV × number of ICP-fitting accounts |
Grounded in your own pricing; survives investor scrutiny | Slow; needs a real ICP and a real account count |
The triangulation gate
Triangulation is the credibility test, not the number itself. 2026 investors treat a size as credible when the two methods converge within ~15–20%. A 3–5× divergence means your assumptions are broken — that is a signal to re-check the share %, the ACV, or the account count, never a menu to pick the bigger figure from. Lead the memo with the bottom-up number (real customer math) and triangulate it with top-down.
Bad "TAM = $50B." # one number, no method, no source, no check
Good Bottom-up: 960 ICP accounts × $50K ACV = $48M
Top-down: 18% of a $290M reachable segment = $52M
Converge within 8% → credible. Lead with $48M.
TAM / SAM / SOM are nested, not interchangeable
- TAM — total demand if you owned 100% of the market.
- SAM — the slice your business model + geography can actually serve.
- SOM — the slice you can realistically capture near-term, given competition and sales capacity.
The funnel SAM ≈ 20% of TAM, SOM ≈ 10% of SAM is an illustrative example to defend, not a constant to assume. Derive SAM from your real reach (model, geography, language) and SOM from the competitive pressure and your sales capacity — then state why. Worked top-down and bottom-up calculations, the convergence math, the SAM-then-SOM derivation logic, and the full memo template with its sources/provenance schema live in references/sizing-playbook.md.
Job 2 — Segment it (reachable AND distinct, with a named beachhead)
Four classic axes — geographic, demographic, behavioral, firmographic (~81% of B2B marketers use firmographics). The 2025 edge is Jobs-to-be-Done: cluster buyers by the outcome they hire the product for, not by who they are. The why is blunt — people buy outcomes, not demographics. Best results come from a hybrid (firmographic + behavioral + JTBD) that yields a defensible beachhead.
Name the beachhead — the one segment you win first. Then run every segment through this test before it earns a row in the memo:
- Distinct need? Does this slice hire the product for a different job than the others?
- Reachable channel? Is there a concrete way to get in front of them (not "the internet")?
- Big enough to matter? Does it move the SOM, or is it a rounding error?
- Different enough to message separately? If the pitch is identical to another segment, it is not a real segment.
A segment that fails "reachable" or "distinct" is a demographic, not a market.
Job 3 — Read the demand (signal vs vanity)
Secondary and primary research answer different questions. Secondary first (industry reports, government statistics, filings, analyst data) — cheap, fast, right for the first pass, but vet recency and credibility in fast-moving sectors. Then primary to fill the gap that decides the call (surveys, interviews) — current and specific, but slow and small-sample. Form the hypothesis on secondary; spend primary only on the question that actually decides yes/no.
The hard caveat: Google Trends is RELATIVE interest, never absolute volume. Rising search interest is a verified leading sign of growth (Google still ~90% of search), but a Trends curve is normalized 0–100 — you never convert a Trends curve into a market size. Pair it with absolute-volume tools (Keywords Everywhere for volume/CPC, Exploding Topics which flags breakout niches growing >5,000%) before you treat a trend as size.
Bad "Search interest doubled on Google Trends → the market is $2B." # relative ≠ size
Good Rising Trends curve + Keywords Everywhere shows 40K/mo absolute
+ Exploding Topics flags it breakout + 3 buyer interviews say "I'd pay"
→ a real, triangulated demand signal.
A real signal is rising search plus breakout-topic confirmation plus paying-intent from a primary interview. Vanity is one viral spike, a single curve, or a report with no date. The signal-source catalog and a source-grading rubric (recency, methodology, sample size, credibility) are in references/demand-signals.md.
The market memo (the artifact)
Every market-research output has the same fixed shape so it can be audited and handed off:
- Hypothesis — the one-line market question being tested.
- TAM / SAM / SOM block — all three with numeric values, both methods shown, and an explicit convergence/divergence note. SOM ≤ SAM ≤ TAM must hold.
- Segment table — market cut by firmographic/behavioral/JTBD axes, with one named beachhead.
- Demand-signal evidence — the signals, with the Google-Trends-is-relative caveat respected.
- Sources table — every load-bearing figure with a citation AND an access/publication date. No undated number survives this row.
This is exactly what scripts/verify.sh checks. Keep it Markdown so the linter can parse it.
Anti-patterns
| Bad | Good | Why |
|---|---|---|
| Ship one TAM number, no second method | Run top-down AND bottom-up, state the convergence | A lone figure is unfalsifiable; readers discount it |
| "$50B market" with no source or year | Cite the report + access date for every figure | Undated/unsourced = a guess; markets move fast |
| Top-down and bottom-up are 4× apart, pick the bigger | Re-check inputs until they converge ≤~20% | 3–5× divergence means broken assumptions, not a choice |
| Convert a Google Trends curve into a market size | Pair with absolute-volume tools before sizing | Trends is RELATIVE interest, never absolute volume |
| Segment by demographics alone | Add JTBD/behavioral; name a reachable beachhead | Demographics miss why people buy, and a market with no beachhead is one you can't enter |
| Treat SAM/SOM as fixed 20%/10% of TAM | Derive SAM from reach, SOM from competition + capacity | Those ratios are illustrative, not constants |
| Name specific competitor products in the memo | Treat competition as a SOM-shrinking force | A dossier is scope creep — hand to competitor-watch |
| List named target accounts as "the market" | Hand the segment to lead-gen to build the list | That is a sales list, not market understanding |
| All secondary data, no primary check on the decisive question | Use interviews/survey to fill the gap that decides | Stale or misaligned reports mislead the call — you just confirm your own bias |
Verify
The memo is a checkable artifact, so scripts/verify.sh lints a produced memo file (read-only — it never edits) for the three things above that keep "market sizing" honest: the numeric SOM ≤ SAM ≤ TAM nesting, both methods plus a stated convergence/divergence note (one method alone fails), and a citation and date on every load-bearing figure.
./scripts/verify.sh # scan ./ for *memo*/*market*.md
./scripts/verify.sh --path memo.md # check one memo
./scripts/verify.sh --path research/ # scan a directory of memos
./scripts/verify.sh --strict # treat warnings as failures (CI gate)
It exits 0 on a clean or empty target — a missing memo is a skip, never a false failure.
Hand-offs
The memo is the start of a chain. When it is done, route:
- Present the sizing as the opportunity slide →
../pitch-deck/SKILL.md. - Model revenue off the SOM →
../financial-model/SKILL.md. - Turn a named segment into an actionable account list →
../lead-gen/SKILL.md. - Profile the rivals that shrink the SOM →
../competitor-watch/SKILL.md. - Set the ACV the bottom-up math depends on →
../pricing/SKILL.md. - Project the demand series forward from history →
../forecasting/SKILL.md. - Act on the keyword/topic demand signals →
../content-engine/SKILL.md.