How many inbounds per month is good?

Few agency owners know the answer to this question. 👇

How many target businesses are in your vertical market?

Translation:  

How many total plumbing businesses are in the US that have a problem you solve?

(For agencies who target plumbers)

Side note: This metric has many names, including  Total Addressable Market (TAM), Total Relevant Market (TRM), Serviceable Available Market  (SAM). Side note #2: Yes--I know these are all different but related metrics--I don't want to get into a war of definitions right now. 

Here's the thing...

Knowing the number of target businesses in your vertical market is critical.

How else do you answer the following questions:

• How many inbounds per month is good? (5% of your vertical market is actively buying per quarter)

• When should we launch the next vertical? (when 3-5% of your vertical market are clients)

• When should we raise our prices? (also when 3-5% of your vertical market are clients)

• How many businesses should we target with our outbound?

• ...and more.

Good news: If you don't already know the number of target businesses that are in your vertical market, it's not hard to get started.  One of my favorite sources for this type of data is IBIS World.  Check them out!

CQ

Frequently Asked Questions

Why does knowing the total number of businesses in a target vertical matter so much?

Because it's the foundation for answering nearly every strategic question, how many inbounds are good, when to launch a new vertical, when to raise prices, all depend on knowing this baseline number.

What are the different names for this metric, and do the distinctions matter?

Total Addressable Market (TAM), Total Relevant Market (TRM), and Serviceable Available Market (SAM), related but technically different metrics, though the exact definitional differences matter less than simply having a real number to work from.

How does knowing this number help determine when to launch a new vertical?

By using it as a benchmark, once 3-5% of the current vertical market has become clients, that's a signal it may be time to consider expanding into a new vertical rather than continuing to chase the same finite pool.

How does this same benchmark help determine when to raise prices?

The same 3-5% client penetration threshold serves as a signal for pricing power as well, once that portion of the market has been captured, there's often room to raise prices without significantly hurting demand.

Where can agency owners actually find this kind of vertical market sizing data?

IBIS World, mentioned directly as a favorite source for this type of data, offering a straightforward starting point for agency owners who don't yet know their vertical's actual market size.