One industry could be categorized into different market niches. Companies use these niches to satisfy their consumers. To understand if this niche is successful or the whole industry, companies take advantage of the metrics to manage their sales. There is a metric that measures the revenue not only to the niche but the whole industry. This metric is called Market Share.
What is market share?
Market Share basically means the percentage of an industry’s sales that belong to a particular company. Think about it as if one cake represents the market share of a whole industry. The goal of every company in this market share is to get a slice. As the industry grows companies need to expand with it to keep their sales percentage. The company with the largest market share in the industry is called market leader.
How is calculated?
Market share is calculated by dividing a single company’s sales for a particular period by the total sales of its industry during the same period. The result can be expressed as a percentage.
Here is a formula for calculating the market share of the company:
Market Share = Total Company Sales / Total Industry Sales x 100
There are several ways to increase your company’s market share.
- Find a specific target audience and build a reputation.
- Create a personality for the brand. You need to stand out from competitors and do something different.
- Create a marketing strategy and engage with the customers. This way you can turn your target users into loyal customers.
- Offer new technologies to users that the competitors can’t provide. This way the consumers would wish to buy this technology and become loyal customers.
- Expand the product even if the product itself doesn’t change.
- Keep the prices at a standard level by always comparing them with competitors.
- Win users trust. Ask customers for opinions about your brand, what they like, and what they don’t. And try to turn the negative reviews into positive ones.
- Another way to boost the business is by adding discounts or other benefits.
Example:
A good example of increasing the company’s market share would be Apple Inc. This technology company not only offers new products to its users but also upgrades their devices. Apple Inc. evolves according to users’ needs and gains their loyalty.
