Case #1: Market Sizing

Help our client RunForFun GmbH enter the German market for running shoes.

#InterviewPreparation #CaseStudy #MarketSizing

Starting point

  • RunForFun GmbH is a leading manufacturer of running shoes for daily training as well as for use in competitions.
  • The company is active worldwide and is now planning to enter the German market. Before doing so, however, the company would like to examine how attractive this market actually is.
  • RunForFun commissions an external strategy consultancy for this task. Among many other aspects (such as route to market, sales and marketing strategy) that are relevant for the client's decision, you first take care of determining the size of the market.


  • How many running shoes are sold in Germany per year?
  • What is the resulting market size (in EUR)?


1. Deriving the target group from the population

  • You first consider how large RunForFun's relevant target group is within the total population.
  • General factors influencing the usage and purchasing behavior of running shoes are, amongst others, age and the general affinity for sports.
  • To simplify matters, we exclude young and elderly people as target groups. In the age groups from 0 to 15 years, running shoes are primarily used for physical education. In addition, we simplify by assuming that the use of sports shoes is comparatively low among over 65 years old people. Furthermore, we can exclude professional sports, as equipment is purchased through sponsors in this field.
  • With a life expectancy of 80 years and ~80 million inhabitants in Germany, assuming equal distribution, there are about 1 million people per age group.
  • As a result, we have selected the 15 to 65 age group as the target group, which with our simplified assumptions comprises around 50 million people. In the next step, we want to further segment these into different types of runners.

2. Segmentation into different types of runners

  • Runners differentiate themselves sich in terms of training frequency and number of training kilometers completed. Based on this, different customer segments with differing demand characteristics (price and frequency of running shoe purchases) can be dertermined. For example, it can be useful to divide customers into the following segments:
  • Non-runners: are not part of the target group and can be excluded.
  • Casual runners: run rather irregularly or own running shoes also with other intended use (e.g., as leisure shoe substitute, for hiking)
  • Ambitious runners: Run regularly (c. 3-4 times a week, e.g. in a runners' group), mainly for health reasons. Performance plays a subordinate role. Total distance of about 1,000 km per year.
  • Competitive runners: Run daily and participate in competitions on a regular base. Run about 3,000 km per year.

3. Calculation of market size

  • Assumption: The number of shoes purchased per year and the price at which a pair of running shoes is purchased increases with the frequency of training or intensity of use. The reason for this assumption is, on the one hand, the limited durability of a running shoe depending on the number of kilometers run and, on the other hand, the increase in quality and willingness to pay a higher price for running shoes of higher quality. A second hand market for running shoes can be ruled out, as runners do not like to wear shoes that have already been broken in; running shoes are bought new.
  • From experience you know that a pair of running shoes is worn, on average, for about 1,000 km. Besides, you consider that shoes cost about 80-120 EUR.
  • For the distribution of the different types of runners in the population, you should make plausible assumptions, e.g. from your familiar environment. In a real project, data from associations, market experts or representative surveys conducted specifically for this purpose could help.
  • As a result, the market in Germany has a volume of around 24 million pairs of running shoes sold per year.
  • In terms of value, this results in a total market of around EUR 1.3 billion.
  • Relevant follow-up questions can be, e.g., what challenges there might be for RunForFun when entering a new market, and which sales channels and partners would strategically make sense.