Having a sense of your market share provides a good indication of your competitive rank and a way to monitor your growth within your target market. To calculate your share of the market, first define the size of the market in which you compete.
You can assess your target market’s size by using the following criteria:
- Geographic targeting: For example, a retailer may determine that its geographic target market consists primarily of people who live or vacation within a two-hour drive of the retailer’s place of business.
- Customer targeting: How many people or businesses actually fit your customer profile? An online florist may focus exclusively on wedding planners and brides-to-be within a single state or region.
- Product-oriented targeting: For instance, a microbrewery may measure its share of a market as a percentage of all premium beer sold in its geographic target area.
After you have a good sense of your total target market’s size, you can use several approaches to calculate your share:
- Unit sales
- Number of potential customers
- Total sales volume
Via Ashok Ramachandran