Estimation of Market Size (BASS Model)


N's spirit Basic MBA > Estimation of Market Size (BASS Model)

Estimation of Market Size (BASS Model)

BASS Model is a kind of Logistics Curve to which purchasing behavior of customers is added. BASS Model is sometimes called BASS Diffusion Model.

Logistics Curve is originally used in order to calculate expansion of population or bacteria but purchasing factors is considered in BASS model.

Examplea of BASS model

BASS Model


Formula of BASS model

S(t)@@(m (p+q)^2 / p) * (exp[(-p-q)*t] / (1+(q/p) * exp[(-p-q)*t)^2

S(t): Sales quantity at time t
m: Maximum accumulated sales quantity
p: External influence coefficient (whether people who haven't purchased yet attempt to purchase by external factors like advertisements.
q: Internal influence coefficient (whether people who haven't purchased yet attempt to purchase by recommendation from others who have already used it)
t: Time (normally it is year)

Standard bass model is used with p = 0.03 and q = 0.38

If p or q is changed in BASS model, each graph is as below.

BASS Model


The more p is, the earlier time until peak become, which means large influence from external factors like advertisement. The more q is, the shaper peak become which means large influence from internal factors like word of mouth.

As done by using Logistics Curve, p and q can be set based on benchmark products or services when penetration speed is estimated


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Estimation of Market Size
Estimation of Market Size (ATAR model)
Estimation of Market Size (Logistic curve)
Estimation of Market Size(BASS model)
Stage Gate System


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N's spirit Basic MBA > Estimation of Market Size (BASS Model)

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