Volume of the target market
Our product addresses the need of project management in startups and small business, categories constinting in enterprises with 1 to 50 employees.
According to the National Institute of Statistics, at the end of 2016 there were 23,848,600 micro and small and businesses in Europe. During our validation stages, we found out that approximately 52% of these business do not use any task management tool, but 63% of them would consider this. These findings lead us to a number of 7,693,554 potential customers, the number representing the target market size.
Therefore, according to the formula below, our computed penetration rate is 32,7%.
Penetration Rate = (Number of Customers ÷ Target Market Size) × 100
To compute the overall market volume, we need to multiply the number of targeted customers with the penetration rate:
Market volume = 7,693,554 * 0.327 = 2,515,792.
On the other hand, our product is also targeting freelancers or any busy person who needs some order in their daily tasks. We found out that at the time being there are approximately 8,900,000 freelancers in Europe, so the target market size within this segment adds up to 2,915,640. In the end, the market volume of this particular customer segment equals 953,414.
On an finishing note, total market volume is 3,469,206.
Players/competitors in our targeted market
Our direct competitors, as determined by our initial market research, are: Trello, Jira, Google Tasks, Asana and to some degree Microsoft Project.
Jira is the most popular task management system, mainly because it integrates with most of the other tools Atlassian is providing, such as: Bitbucket, Trello, Bamboo, etc. Another reason for Jira’s popularity is represented by the fact that it provides the necessary tools for use in an Agile framework, which became adopted by the vast majority of the software development companies.
On the other hand, a direct competitor to Jira is represented by Microsoft Project that draws its success from being used in a bundle of Microsoft products and services like Microsoft Server, Azure, Microsoft Office Suite, etc.
Google Tasks, even though adopted by companies that use the G Suite from Google, it has become popular with freelancers and individuals that use it to organise their private lives because of the fact that Android mobile phones include the Google suite free of cost and it is installed by default.
Trello has been bought by Atlassian in 2017 and it has been promoted as a free, board oriented, task management tools for all ever since. Although very popular with individuals and freelancers, Trello didn’t get much sympathy from companies, hence its market share is one of the smallest out there.
Asana is a team organisation tool that provides good quality features, but none of their usage plans is for free, not even for personal use. Even though it has been on the market since 2008, their market share is one of the smallest and hasn’t increased very much over the years.
Market share for competitors
At the moment, our competitors share of market value is as follows:
Trello: 4.99%Asana: 0.71%Jira: 42.67%Google Tasks: 12.48%Microsoft Project: 14.71%Others: 24.44%
Potential market share 5 years after launch
Year 1: TaskYourself is a new product, so our target for the first year after launching is to reach the market share of its smaller competitors, which translates to a percentage between 0.5% and 1.0%.Year 2: We estimate a slight increase in the market share, reaching about 2.0%.Year 3: In the third year we estimate another increase of 0.8% to 1.1%, as a result of adding new features and integrated the feedback from our customers. This should take us to somewhere in between 2.8% and 3.1% of market share.Year 4: As our product gains popularity, we believe we can win another 1.0% to 1.3% because of the latest improvements and take our share to about 4.1%.Year 5: Our ultimate goal for the 5th year after launching is for our product to become a competitor as popular as Trello is in the present (or even better if possible), with a market share of above 5.0%, ideally at 5.2%.
Total market value and value of market share 5 years after the launch
Since our product is offered free of charge for individual users, our market value is based on the monthly business subscriptions. TaskYourself applies the following price policy:
- €15/month for micro businesses (1-10 employees)
- €20/month for small businesses (11-49 employees)
We found out that our target market consists of 95% micro business and 0.5% small business.
Year 1: 25,158 represents the total number of enterprise clients, given the 1.0% market share.
- 23,900 * 12 * €15 = €4,302,000 (micro businesses)
- 1,258 * 12 * €20 = €226,440 (small businesses)Year 2: Total number of enterprise clients, given the market share of 2.0% is 50,316
- 47,800 * 12 * €15 = €8,604,000 (micro businesses)
- 2,516 * 12 * €20 = €452,880 (small businesses)Year 3: Number of customers reaches 72,958. By year 3, the offices of our company should expand to accommodate the influx of new employees so a big part of the profits will go into paying for the new contracted services.
- 69,310 * 12 * €15 = €12,475,800 (micro businesses)
- 3,648 * 12 * €20 = €875,520 (small businesses)Year 4: With a market share of 4.1%, we should have about 103,147 customers.
- 97,990 * 12 * €15 = €17,638,200 (micro businesses)
- 5157 * 12 * €20 = €1,237,680 (small businesses)Year 5: 125,790 clients, assuming a market share of 5%.
- 119,500 * 12 * €15 = €21,510,000 (micro businesses)
- 6290 * 12 * €20 = €1,509,600 (small businesses)