Estimation question

How would you estimate the number of new users Amazon gets in a day?

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What this question tests

Estimation using known scale of an established platform and reasonable growth rate assumptions.

How to approach it

  1. Estimate the platform's total active customer base, commonly cited in the hundreds of millions to over a billion globally across all markets.
  2. Estimate overall annual growth rate in active customers, for example a modest single digit percentage given maturity in many markets.
  3. Convert annual net new customers into a daily figure by dividing by 365, noting this is net growth, not gross new sign ups.
  4. Adjust to reflect gross new sign ups specifically if that is what is being asked, factoring in that many sign ups come from existing household members creating additional accounts.
  5. State the final estimate as a range and clarify whether it represents net platform growth or gross new account creation.

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