Posted in Marketing and Strategy Terms, Total Reads: 308
Definition: Dollar Market Share
Dollar market share can be calculated by dividing the dollar revenue earned from a product by the total dollar sales including its competitors in that segment. The unit market share is calculated by dividing the number of units of the product sold by the total number of units sold in the segment. Both metrics are used for analysis, depending on the context.
Market share can be calculated on different bases, such as the number of units sold, or the share of dollar volume of the market.
The market share is a marketing metric which indicates the percentage of the market that has been captured by a particular product or brand.
The market share can be used as an indicator to understand the performance of a firm. It shows where the company stands, relative to its peers or competitors. If the total market size grows and the company maintains the same market share relative to its peers, it implies that the revenues from the product are also increasing.
For example, if the total sales revenue from a particular brand of biscuit, say X, is $200000, and the total revenues from the sales of biscuits in general is $2000000, this implies that the dollar market share of X is $200000/$2000000 = 10%.