Question
I am dealing with controlling air conditioner through the internet (app).
I have data how many airco's are being sold every year.
I have data what's the penetration of smartphones in the countries i target.
I have data how many households have WiFi (it's mandatory for my device).
How do I get the number how many potential customers (airco, smartphone and WiFi) do i have?
Answer
Assume 1,000 air conditioners are sold each year, 50% of housholds have a smart phone, and 25% of households with a smartphone have wifi. Then your potential customer base is 1,000 * .5 * .25 = 125 customers. But that's a top down analysis; generally, bottoms-up analyses are more robust.
