Relative market share compares the market share of a company with that of its next biggest rival. A company which has a relative Market share means that they are the market leader which eclipses their competitor by this factor.
Purpose. The purpose of the “relative market share metric” is to access a firm’s or a brand’s success and its position in the market. A firm with a market share of 25% would be a powerful leader in many markets but a distant “number two” in others.
Market share is the percentage of total industry revenue that flows to your company. If you divide your percentage share by the percentage share of the largest company, you have your relative market share.
Both absolute market share and relative market share can help businesses make strategic decisions to fuel their growth. While absolute market share shows how much growth potential a company has within its industry, relative market share offers insight on how to identify and outperform specific competitors.
And there can only ever be one brand/firm that has a relative market share greater than one. This will be the market leader only. All other brands (or firms) will have a relative market share of less than one.
How do you calculate relative growth rate?
In classical growth analysis, relative growth rate (RGR) is calculated as RGR = (ln W2 – ln W1)/(t2 – t1), where W1 and W2 are plant dry weights at times t1 and t2.
What do you understand by BCG matrix?
The Boston Consulting Group (BCG) growth-share matrix is a planning tool that uses graphical representations of a company’s products and services in an effort to help the company decide what it should keep, sell, or invest more in.
What is BCG matrix with example?
A perfect example to demonstrate BCG matrix could be the BCG matrix of Pepsico. … Cash Cows – With a market share of 58.8% in the US, Frito Lay is the biggest cash cow for Pepsico. Stars – Even though Pepsi’s share in the market has been reduced to 8.4%, it’s still the star for Pepsico because of its brand equity.
Market share is the percentage of total sales (by value) or total output that a business has in a specified market.
Apple claimed a 23.4 percent share of the market in the fourth quarter of 2021, an increase from the previous quarter. Apple’s long time competitor, Samsung, followed in second place with a market share of 19 percent.
Relative market share can be calculated in terms of revenues or market share. It is calculated by dividing your own brand’s market share (revenues) by the market share (or revenues) of your largest competitor in that industry.
How to Increase Market Share?
- Innovation. Innovation is an excellent method of increasing market share. …
- Lowering prices. A company can also expand its market share by lowering its prices. …
- Strengthening customer relationships. By strengthening their existing customer relationships. …
- Advertising. …
- Increased quality. …
What is the best marketing strategy?
If you are looking for the overall most effective marketing strategy for small business, content marketing is the winner. Content marketing encompasses blogs, videos, social media posts, podcasts, webinars, and more – basically, any type of content you can distribute online falls into this category.