Why Use Relative Market Share?
Why should marketers review relative market shares? Let’s find out why relative market shares are often a more insightful metric than ‘normal’ market shares.
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Market Concentration and the Herfindahl-Hirschman Index
The Herfindahl-Hirschman index (HHI) is a measure of market concentration. It is calculated by squaring each of the market shares.
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Market Concentration for Marketers
The market concentration marketing metric uses unit market shares to determine the extent of dominance by the large players in the marketplace. It is a key metric to measure the intensity of competition within a market.
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BCG Matrix Formulas
This article details the formulas and calculations required to construct the BCG matrix, namely Relative Market Share and Market Growth Rate.
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Market Share in the BCG Matrix
For those people familiar with the BCG matrix, you should recall that the horizontal axis measures relative market share. And this factor is the more important of the two dimensions in the model.
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Variations of Market Share
It would be a mistake for a firm to rely upon one market share measure only. Assuming that the firm has access to competitive sales information, then a variety of market share metrics should be calculated and reviewed.
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Examples for Calculating Market Shares
Market share is an easy metric to calculate provided you have access to unit and revenue sales. Here are some examples, and grab the free market shares Excel template as well.
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Price Premium Index
Price premium refers to the brand’s price to the consumer relative to a key competitors price or relative to the average price charged in the marketplace. There are two ways to calculate price premium, depending upon whether or not we have access to market share information.
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Decomposing Market Share
Did you know that market share is made up of three underlying components? The factors are share of customer, penetration share and usage index. Find out more!
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Market Shares: Overview and Formulas
Market share is a measure of how the brand/firm is performing relative to its competition.
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