There are two types of Market Share, that is, two ways of calculating this indicator: value-based and volume-based .
The difference between the two is very easy to understand, check it out:
The value indicator is related to the company's revenue and its market.
Thus, the goal is to understand the level of revenue share of the company compared to the overall revenue of its market.
In addition, we have the volume share, which analyses the total number of sales in relation to sales made by the entire market.
An example that simplifies the understanding of their difference is the following:
Stop and think about the comparison of the participation of these three mexico whatsapp data vehicle brands: Volkswagen, Fiat and Ferrari.
Even though Ferrari's value share is very high, its volume share, compared to the other two car manufacturers, is certainly lower, as few people can afford to buy its vehicles.
What elements are taken into account in Market Share ?
Before understanding how to calculate market share, let's review all the elements that are taken into account to obtain a realistic result.
They influence the type of calculation, as well as the index being sought, from the simplest and most objective to the most complex.
We have separated the main factors, along with a brief explanation of each. Check:
Billing
The calculation of the value ratio takes into account a company's revenue compared to the revenue of its sector.
Perhaps the main problem is, precisely, knowing this last measure.
Some sectors disclose results publicly, especially in the case of publicly traded companies.
However, if your organization does not have the necessary data, it will be necessary to make estimates in conjunction with specialized consultancies or even studies.
Brand penetration
In the case of brand penetration, this is a factor that will depend on market research tools and the help of specialized consulting firms.
It is not necessary in the calculation of market share, but it can be included, which increases its degree of complexity, especially since we are talking about an index with a certain margin of error.
Market value
When we talk about market share by market value, what is considered is the monetary value that your company represents.
That is, if your organization was valued at $5 million and you have three competitors worth $3, $5, and $7 million respectively, your market share would be: