The total addressable market (TAM) represents the full revenue opportunity available for a product or service if it achieved 100% market share. It provides a high-level view of commercial potential and is often used during strategic planning, investment discussions, and product development.
In B2B marketing, understanding TAM helps organisations quantify the size of a market and identify its long-term growth opportunities. It sets the outer boundary for how large the business could potentially scale within a given category. TAM calculations may be based on number of companies, total spend, or similar macro-level indicators.
While TAM offers the broadest perspective, it’s most valuable when paired with serviceable addressable market (SAM) and serviceable obtainable market (SOM). Together, these metrics help teams distinguish between theoretical potential, realistic opportunity, and achievable market share, resulting in more grounded, data-driven planning.
