Area market potential

A part of the total market potential with respect to different cities, states and nations. Estimation of area market potential is important because many times companies face the problem of selecting the best territories in allocating their market budget optimally among these territories. Therefore, they need to estimate the area market potential. Two major methods of assessing the area market potential are: market build-up method, which is use primarily by business marketers, and the multiple factor index method, which is used primarily by consumer marketers.