Well, it's the combination.
If you have been on the market for a while with no showings, it is probably time.
If you have had a lot of showings, but no offers, or no "second showings", it also may be time.
With a down market, the longer you wait, the less you end up getting.
All of this depends on whether your listing is properly advertised, though.
If your listing isn't properly advertised, then don't jump the gun.
Make sure there are plenty of good quality photos on the listing. Make sure the description is not only accurate, but inviting. Make sure there are directions on the listing.
Also , make sure your house shows as well as it can. Unclutter, depersonalize, and make sure you don't turn down showings unless you really have to.
And always have your listing agent keep you updated with your current market.