Market Share
The percentage of total market sales or customers that a company controls in a specific market.
Definition
Market share represents a company's portion of the total sales volume or revenue in a particular market. It indicates competitive position and is a key metric for measuring business performance relative to competitors and market growth.
How to Calculate
Revenue Market Share:
(Company Revenue ÷ Total Market Revenue) × 100
Unit Market Share:
Company Units Sold ÷ Total Market Units Sold) × 100
Real-World Example
Video Conferencing Market:
- • Total market size: $10 billion annually
- • Company A revenue: $3 billion
- • Market Share = ($3B ÷ $10B) × 100 = 30%
Company A controls 30% of the video conferencing market.
Market Share Categories
Market Leader: 40%+ market share
Market Challenger: 20-40% market share
Market Follower: 5-20% market share
Market Nicher: Under 5% market share