Market share

Airlines competing for market share of Europe-Japan revenue flight market: Swiss and SAS

Market share is the percentage of the total revenue or sales in a market that a company's business makes up. For example, if there are 50,000 units sold per year in a given industry, a company whose sales were 5,000 of those units would have a 10 percent share in that market.

"Marketers need to be able to translate and incorporate sales targets into market share because this will demonstrate whether forecasts are to be attained by growing with the market or by capturing share from competitors. The latter will almost always be more difficult to achieve. Market share is closely monitored for signs of change in the competitive landscape, and it frequently drives strategic or tactical action."[1] Additionally, market share is a key metric in understanding performance relative to the growth of the market as measurement of internal sales growth (or decline) only may be a result of similar growth or declines in the industry being measured.[2]

Increasing market share is one of the most important objectives[according to whom?] of business. The main advantage of using market share as a measure of business performance is that it is less dependent upon macro environmental variables such as the state of the economy or changes in tax policy.[not verified in body]

In the United States market, however, increasing market share may be dangerous for makers of fungible and potentially hazardous products such as medicine, due to a US-only legal doctrine called market share liability.[why?]

  1. ^ Farris, Paul W.; Neil T. Bendle; Phillip E. Pfeifer; David J. Reibstein (2010). Marketing Metrics: The Definitive Guide to Measuring Marketing Performance. Upper Saddle River, New Jersey: Pearson Education, Inc. ISBN 0137058292. The Marketing Accountability Standards Board (MASB) endorses the definitions, purposes, and constructs of classes of measures that appear in Marketing Metrics as part of its ongoing Common Language: Marketing Activities and Metrics Project.
  2. ^ "What is Market Share?". The Stevenson Company. 2019-06-12. Retrieved 2019-10-09.

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