Share of Wallet

Posted in Marketing and Strategy Terms, Total Reads: 1227

Definition: Share of Wallet

Share of wallet refers to the percentage of spending by a customer for buying the products of a particular company or brand. Consider a consumer who purchases soft-drinks. If he purchases 4 Pepsi and 6 Coke during the month then the share of wallet for Pepsi is 40% and for Coke is 60%.

Companies try to increase the share of wallet of a consumer by offering different product mix under the same brand. The consumers tend to buy the product if it comes from their trustworthy brand. For example many people used to consume Amul milk and Amul Butter. When Amul launched different products like Amul Cheese, Amul Dahi, Amul Kool these customers bought the new items because it came from their trustworthy brand of Amul. Thus in this way Amul increased its share of wallet.

Apart from increased revenue companies also benefit from the fact that getting new customers (customer acquisition) is difficult than customer retention. The existing customers turn out to be more brand loyal if a company offers more products under the same brand name. It also increases a customer lifetime value with the brand.


Hence, this concludes the definition of Share of Wallet along with its overview.


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