What is the Sales Potential of a Market?

Companies often make sales projections to determine their production levels and, therefore, their profits. In this way it is easier to develop its growth, but it cannot be achieved without measuring it.

As a preliminary phase, there is the so-called market potential, one of the indicators used in marketing to determine which strategies are going to be used within a company.

It consists of projecting the total volume of sales that could be achieved in a specific sector of the market. For example, the commercialization of computers) in a certain place and time.

On the other hand, there is also the so-called sales potential, which is part of the previous one. But, in this calculation, sales that correspond to a single specific brand are involved. In this case, the example would be HP, Lenovo, Asus, Acer, Apple, etc. They are all computer brands.

This, for its part, measures how much is the maximum sales that can be made during a certain site and period, of course, always in the most favorable conditions. Even if the numbers are high, they must be achievable.

Finally, it is important to note that this calculation can be carried out on a large or smaller scale, that is, a sample can be taken local (one or some cities), regional (one or some departments or states), national (the whole country), international (several countries).

Likewise, the market potential and the sales potential may merge on some occasions, when the sale of a product or service is monopolized by a single company, as is often the case with some public services (water, gas, electricity).

For what and how is the sales potential calculated?

This study is usually carried out by those companies that wish to venture into the sale of a product or service. The idea is to determine if the production efforts are really going to pay off or not. The sales manager of the company is the one who usually takes care of this task to use it in their marketing strategies.

On the other hand, this calculation can be measured through CRM systems (customer relationship management), which are responsible for collecting information from each client thanks to various channels such as social networks, the company website, databases with contact record by chat, phone or email, among or

others. After obtaining and gathering the data, through these same systems, easy-to-interpret infographics can be elaborated, with the aim of optimizing and speeding up decision-making.

Another variable to take into account to carry out the calculation is the sales history of a similar brand (third parties) or of the one that wants to venture into the commercialization of a product (own). Many times the authority that a brand already has in the market is a plus point when wanting to launch a new product.

How many types of CRM are there and how do they work?

There are three types of CRM systems that serve to support companies in calculating their sales potential and are the following:

• Operational CRM

It is the one that automates the marketing and sales procedures, in order to detect potential customers to return them regular customers and collect their data to study their consumer behavior, so that you can provide them with better and better service.

• Analytical CRM

It is responsible for analyzing those data that were previously collected by different means, to transform them into profiles that are part of a statistic that allows managers to make decisions based on acts.

• Collaborative CRM

Its main objective is to share the analyzed data to help attract new customers and retain existing ones. It is achieved by collaborating with the marketing department to improve their campaigns and make them more effective; to the sales department, to increase the benefits offered to customers; as well as the customer service area, to improve its functions and thus reinforce the consumer experience.

What is the difference between the sales potential and the sales forecast?

Although these definitions are similar, they refer to different calculations. On the one hand, we have to sales potential seeks to determine how much is the maximum sales that can be achieved from the same product in optimal conditions (good distribution, advertising and promotion, among others).

Also, the sales forecast It is a more realistic figure, as it refers to the calculation of the sales volume that is estimated to be achieved under the conditions that the company can afford, based on its budget. In general, this study is done on an annual basis (although there may be revisions quarterly or semi-annual), after having made a calculation of the market potential and the potential for sales.

To determine both the sales potential and the sales forecast, four main variables are taken into account, which are the behavior of the consumer, the company, its competition and the economic and cultural context in which the activity takes place commercial

Finally, there is talk of a sales quota, which is an internal calculation that companies make to establish the sales goals that workers should meet in a certain period.