Number of persona in the target market

There are several ways to determine the number of personas in the target market.

Important requirements

It is important to understand that we never need the very exact number of personas in the target markets.  A business plan is about a very rough set of figures. An approximate figure is therefore sufficient. This figure should be:

1. Corresponding to the power of ten, i.e. 1,000, 10,000 or 100,000
2. Within the power of ten, based on further assumptions and data, the value should approach a reasonably realistic value, e.g. 5,600, 45,000 or 230,000.
3. The result must be discussed and agreed with the management

Persona number determine in closed and open markets

If we want to determine the number of personas in the target markets, then we consider the following classification of markets:

1. The target markets are closed markets, e.g. dental practices in Germany (approx. 40,000 according to the Association of Dentists)
2. Their target markets are open and not specified by any industry, e.g. product managers in Germany and they do not find numbers

Number of personas in closed target markets

If you develop products for closed markets, the number of companies is defined.
As shown above, you can get the number of companies from associations, for example. You can also get the numbers of companies from official statistics.

If you know the number of companies, then you can also determine the number of personas in the target market quite easily.

Example:

There are 40,000 dental practices in Germany, then this results in approx:

• approx. 50,000 dentists (there are practices with several dentists)
• approx. 80,000 dental assistants
• etc.

In this case, the number of dentists is equal to the number of persona, i.e. approx. 50,000 in Germany.
These figures are perfectly sufficient for the preparation of a business plan.

Number of personas in open target markets

If we want to determine the number of product managers in Germany, for example, we can proceed as follows:

We should determine figures for the following questions:

1. How many companies with what approximate number of employees are there in Germany?
2. From which approx. company size is there a product management in the company?
3. How many product managers are there with what number of employees in the company?

The figures from question 1 can be found at the Federal Statistical Office, which also exists in a similar form for other countries.

Accordingly, there are:

• Number of companies with 10 to 50 employees = approx. 350,000
• Number of companies with 50 to 250 employees = approx. 73,000
• Number of companies with more than 250 employees = approx. 16,700

Question 2 can be answered from experience. There is product management at the earliest from more than 50 employees in the company and these are then technology companies. So we only consider companies with 50 to 250 employees and companies with more than 250 employees.

The answer to question 3 depends on the industry. There may not be product managers in all industries, which we should take into account. The ratio of product managers to employees in manufacturing tends to be lower e.g. 1,500 employees and 10 product managers. In technology companies the ratio is larger, e.g. 250 employees and 10 product managers.
Now we agree on a rough average value and assume the following:

• Number of product managers in companies with 50 to 250 employees = approx. 2
• Number of product managers companies with more than 250 employees = approx. 5

Now multiply the numbers:

• Number of companies with 50 to 250 employees = approx. 73,000 x 2 product managers = approx. 146,000 product managers
• Number of companies with more than 250 employees = approx. 16,700 x 5 product managers = approx. 83,500 product managers

At the end you add up the results:

• approx. 146,000 product managers + approx. 83,500 product managers = approx. 229,500 product managers in Germany

Conclusion: you can use this way for the number of persona, for each persona and determine their approximate number. 

It is important to coordinate with the management!

The number of product managers in Germany that we have just determined is a rough assumption that is perfectly adequate for calculating a business plan.
Nevertheless, this number must be discussed with the management.

Your advantage: You can show management a path based on official data as well as explain your individual steps, and that's what it's all about.

Read the continuation: Interviews with the right persona

The article Number of persona in the target market is an excerpt from our textbook Strategic Product Management, which is available for free download.

Overview: Articles and information for product managers