Subject areaMetrics and measurement
Market share is the portion of a market's total sales that goes to a single company or brand.
It is calculated by dividing the company's sales by the sales of the whole market, over the same period and in the same territory, and it can be measured in value (revenue) or in volume (units sold).
The figure matters because it measures relative position: growing revenue inside a market that grows faster means losing ground. This is why the site's articles tie market share to the ability to innovate, and describe losing it as the consequence of falling behind competitors who accelerate.
An example
An industrial paint manufacturer has sold the same volumes for three years, while the market has grown in the meantime: its market share has shrunk, because competitors captured almost all of the new demand.
Enrico Giubertoni. Licensed under CC BY-NC 4.0: you may quote, translate and adapt this entry with the author’s name and a link, stating any changes. For commercial use, write to info@enricogiubertoni.com
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