Controlled market share. Market share is a marketing metric: assessment and analysis. Market segmentation

Market volume. Please calculate for me what the market capacity is and what market share we occupy; such requests are often heard from company executives. It will not be difficult for an experienced marketer to make such a calculation, so this article is dedicated to young professionals and novice marketers.

First we need to understand the market capacity

Market capacity = Volume of product consumption per capita * number of citizens in the region. (we take data from all possible sources: population census, per capita consumption statistics, etc.)

Now we calculate the market share as a percentage:

Market share = (Your sales volume (number/year) * 100) and divide by market capacity (it’s clear here, we take sales volume from our database)

Now from practice.

Changing market conditions
The shadow sector, which can be many times larger than official data.
Errors in information collection methodology.
There are errors when collecting information

If you calculated the market share, this indicator is the final figure at the time of calculation. By and large, your manager does not need this indicator. He will not make any decisions after knowing the market share. This is monkey work!

If your manager nevertheless asks you to calculate market share, ask him the following questions:

How are you going to use the resulting indicator to make a decision?
What will this information give you?
How the market share indicator will help you in your work.

If management starts to mumble, find an alternative that will really help in making a decision. Since you cannot accurately calculate the market share indicator, you cannot draw any special conclusions. And besides, to work with market share, it is necessary to observe the dynamics of this indicator. And all the inaccuracy of statistical data can lead to unexpected results. In modern marketing, it is necessary to work not for the market share, but for the customer share. Select for yourself large clients who are already yours and with whom you can work. Determine their purchasing potential and calculate the share based on these indicators. This will really help you increase your profits, and you can calculate your market share once a year and compare it with last year’s indicators, not for making a decision, but for the sake of curiosity. Good luck with your marketing!

Dear friends!

I get the impression that my articles are being written in vain, but at the same time a lot of people download my work.

Let's be friends and communicate! Please leave comments in each article whether you like the article or not. Maybe some recommendations or criticism. Let's live and communicate. In this case, I will have an incentive to write new articles, create and share new reports and many other interesting things with you.

Relative market share is determined by the ratio of a firm's share of the market to that of its leading competing firm.

The market shares of a firm or its strongest competitor are found as the ratio of sales volume to the market capacity of a given product, respectively, by the firm or its strongest competitor.

For example, the market capacity for product No. 1 is 7,353 thousand units, and the volume of sales of product No. 1 by the company is 2,500 thousand units. Then the market share of the company for product No. 1 is 34%

Hence the ODR for product No. 1:

This means that the volume of sales by the company of product No. 1 exceeds the sales of a similar product by the strongest competing company by 2 times.

4. Calculation of the share (%) of each type of product in the total sales volume of the company for 2000.

Table 1.2

5. Construction of the bkg matrix

As an assessment scale individual species products (average values in the matrix) apply:

Average market growth rate index (MR), equal to the average value of market growth rates for individual products:

Relative market share - average value ranging from minimal to maximum value relative market share.

For example, in our example:

The diameter of the circle for the product image is chosen in proportion to the share of product volume in the total sales volume of the company.

The BCG matrix has the form shown in Fig. 27.

6. Formation of the company’s product strategy based on the analysis of the bkg matrix.

It is formed by individual types of products and may contain the following strategic decisions:

Remove from the company's product portfolio;

Increase sales volume by changing the structure of the product portfolio;

Change relative market share;

Increase investment;

Introduce strict control over investments and redistribute funds between certain types of products, etc.

When forming a product strategy, you can use the following set of solutions and principles for forming a product (product) portfolio:

- “stars” to protect and strengthen;

If possible, get rid of “dogs” unless there are compelling reasons to keep them;

Cash cows require strict control of capital investments and the transfer of excess cash proceeds under the control of the company's top management;

- “difficult children” are subject to special study in order to determine whether, with certain investments, they will not be able to turn into “stars”;

The combination of “cats”, “stars” and “cash cows” products leads to the best results for the company - moderate profitability, good liquidity and long-term growth in sales and profits;

The combination of cat and star leads to unstable profitability and poor liquidity;

The combination of cash cows and dogs leads to falling sales and lower profitability.

One of possible options The company's product strategy is presented in Table. 1.3.

Table 1.3

The main direction of the company's strategy is changing the structure of the product portfolio and redistributing available funds.

The BCG matrix is a convenient method for comparing the various SZHs in which the company operates. The BCG matrix actually uses only one indicator to determine a company’s prospects in the market – growth in demand. Horizontally, the original version uses the market share of the company under study relative to the competitor's market share. For each agricultural sector, the future growth rate is assessed, market shares are calculated, and the results obtained are entered into the appropriate cells. The BCG diagram offers the following set of decisions on the further activities of the company in the relevant business areas:

“stars” to strengthen and protect;

if possible, get rid of “dogs” if there are no compelling reasons to keep them;

“cash cows” require strict control of capital investments and the transfer of excess cash proceeds under the control of the company’s top management;

“wild cats” are subject to special study to determine whether, with certain investments, they cannot turn into stars.

“Wild cats” under certain circumstances can become “stars”, and “stars” will subsequently turn into “dogs”. The BCG matrix helps to perform two functions: making decisions about intended positions in the market and distributing strategic funds between different business areas in the future.

General Electric Matrix

The pioneer in the development of an improved matrix of the company's strategic portfolio of SZH with variables: the attractiveness of SZH - KSF is the General Electric company (in collaboration with the consulting firm Mc Kinsey). This matrix has a dimension of 3? 3. Typically, in this matrix, the areas of circles (rectangles) representing SZH are proportional to the sales volumes in them, and the shaded sectors show the market share controlled by the company (Fig. 16.5).

Rice. 16.5. General Electric Matrix - McKinsey

In principle, the firm itself can set the boundaries between sectors of the matrix. But since when estimating in points we proceeded from the possible spread (-5, +5), and also normalized the resulting total values for factors, we can recommend the following sector boundaries:

small (weak): -5 ? -2; average (average): -2 ? +2; high (large): +2 ? +5.

Such matrices are usually supplemented with information on appropriate investment flows. For example, General Electric's matrix identifies three priority areas for investment:

With weak priority; - average; - high (see diagram Fig. 16.6).

Rice. 16.6. Feasibility of investment flows

The Shell company adds a number of recommendations to such a matrix, and also provides an additional decision-making table (Table 16.8).

Table 16.7

Investment strategy

Table 16.8

Decision-making table depending on profit prospects and return on investment

http:// www. stplan. ru/ articles/ theory/ mckincey. htm

McKinsey's 7S Analysis

assessment of the internal environment of a company operating in the market:

1.company strategy

2. competitive advantages

3. goals and values

4. staffing

5. style of company activity

6. organizational and functional structure

7. various processes occurring in it (management, production, sales, movement of information flows).

Example of the "7S" model

When all S-factors function in harmony, a company becomes a powerful competitive force. It can be argued that with its initial successes Apple company Computer is obliged to balance S-factors. She professed an entrepreneurial style, supported by the founders, which attracted the most powerful and creative personnel to her. With state-of-the-art technological and professional capabilities at its disposal, Apple's founders chose a loose matrix structure that matched the personal qualities of its workers and the challenge of creating new products.

Apple has developed support systems to reward innovation and monitor operations management. The reward system reinforced the universal values of teamwork and the pleasure of achieving the company's highest goal - to provide every family with the best, most user-friendly computer possible. Apple's strategy was to create a patented, easy-to-use system for the home, school, and graphics markets. All S-factors were well adjusted to one another and provided mutual support on the path to achieving the goals.

Do an MBA-style analysis of your favorite organization. Write down the seven S-factors on a piece of paper and dig into them. An MBA strategy consultant is doing the same thing you're doing now with the 7S model. True, the consulting firm will accompany its analysis with interesting computer graphics, put its work in a beautiful folder and charge your company a tidy sum.

Rice. 2. Model 7S Mc Kinsey

The presented model allows us to analyze both the “hard”, more tangible aspects of the organization’s activities, and the “soft”, more difficult to formalize. The first, hard ones, include strategies, structures and systems. Soft ones include the value system, skills and competencies, personnel and style. Analysis of these aspects allows us to identify the strengths and weaknesses of the company, but does not make it possible to analyze the external environment.

http://www.gri.com.ua/index.php?id=36&tx_ttnews=10&tx_ttnews=15&cHash=c5806fb4b9

One of the main indicators used in assessing the competitiveness of companies is market share. This is a simple but objective indicator of a company's performance. It may be that, at first glance, the company is developing just perfectly: profits are growing, the pace of sales is also increasing, and is becoming more and more recognizable. But if the market share is small, then the prospects for business development seem quite doubtful. Therefore, when analyzing a company’s marketing efforts, it is always necessary to monitor its market share, as well as the market shares of its closest and/or strongest competitors.

Where: D r- market share, %;
Q n– sales volume (sales) of our or another analyzed company. Can be calculated both in physical terms (pieces) and in monetary terms (rubles);
Q total– total sales volume on the market. It can also be expressed both in pieces and in rubles.

There are 3 consumer electronics stores in the city. For the year, sales volumes in store A amounted to 15 million rubles, in store B – 20 million rubles, and in store C – 25 million rubles Let's calculate the market share for store A:

Thus, the market share of store A is 25% .

Scope of application of the market share indicator

Market share measures two extremely important things. Firstly, the dynamics of market share over the years shows the success of the company's development over time. Secondly, calculation and comparison of the market share of the company and other companies offering similar products in a given region shows the competitiveness of this company.

Features of the market share indicator

Market share can be calculated based on:

cost indicators ( volumes of product sales in rubles.);
natural indicators ( sales volumes in pcs.);
number of clients.

market share can be calculated both relative to total sales volumes for the market as a whole, and relative to the sales volume of the strongest competitor (competitors).

Galyautdinov R.R.

Relative market share measures the market share of a company or brand compared to its largest competitor and therefore reflects the company's true market power and identifies opportunities for improvement. Let us explain the importance of the phrase “relative share”: with a 20% share you can either dominate the market or remain in second or even lower position among competitors.

The key question this metric helps answer is how much is our market share increasing compared to our competitors?

Calculating relative market share (see formula) allows managers to compare relative positions in markets various products. This KPI has gained popularity due to research (especially by the Boston Consulting Group) which has shown that major market players tend to be more profitable than their competitors (although there are detractors to this claim, see Notes).

Relative market share is more likely to be closer to cash flow, since the higher the market share, the more cash flow is generated. As a result of economies of scale, these profits are expected to grow faster the higher the market share.

The reason for choosing relative market share rather than just profit is that market share conveys more information than simple cash flow. The relative market share indicator shows the position of the brand relative to its main competitors and its possible future. It also provides insight into what type of marketing activity will have the greatest impact.

The relative market share measure was first proposed in the 1960s. and was subsequently popularized by the Boston Consulting Group in their famous Relative Market Share and Growth Rate matrix.

In this matrix, one axis represents relative market share - an analogue of competitiveness. The other axis represents the market growth rate - . On each axis, products are classified as “high” or “low”, falling into one of four quadrants. In the traditional interpretation of this matrix, products with a high relative share in a growing market are considered “stars”, the production of which must be supported by an appropriate level of investment. Cash for such investments can be obtained from "cash cows", products with high shares in relatively stable markets. “Question marks” or “problem children” may have the potential for further growth, but are currently in a weak competitive position. And finally, the “dogs” have neither growth potential nor sustainable competitive positions.

How to take measurements

Information collection method

Information can be obtained through analysis of publicly available annual reports and market research. If obtaining information is difficult, then such an analysis can be performed to order.

Formula

Relative Market Share (%) = Company Market Share / Largest Competitor Market Share.

As can be seen from the formula, a brand's share is measured relative to its largest competitor. Thus, if a brand's market share is 20% and its largest competitor has the same figure, then the ratio will be 1:1. If the largest competitor has a 60% share, then the ratio will be 1:3, meaning that the organization's brand is in a weaker position. If the largest competitor has a share of only 5%, then the ratio will be 4:1, meaning that the organization's brand holds a strong position, and this in turn can be reflected in profits and cash flow. When this method is used in practice, the relationship is logarithmic rather than linear.

Measurements are usually carried out annually, more often in dynamic markets.

The source of information is annual reports or market research.

The cost of data collection can be very high, especially in cases where high-quality information is not available. Benchmarking data is available for many industries, but this route can also be expensive. When available necessary information the cost of data collection is minimal.

Target values

Target values can be determined based on existing market research. Comparative data can be gleaned from articles that examine how organizations maintain high positions in relative market share.

Example. Let's consider the example of the production of small city cars. As initial information, we present a table with production indicators of the key players in this market.

Company	Number of units sold, thousand units.	Revenue, thousand dollars	Market share, %
Zipper	25	375 000	40
Twister	10	200 000	21,3
A-One	7,5	187 500	20
Bowlz	5	125 000	13,3
Chien	2,5	50 000	5,3
Total by market	50	9 375 000	100

A-One's management needs to know its relative market share relative to its largest competitors. The calculation was made in relation to the number of cars sold and the revenue received.

A-One sells 7,500 cars a year. Zipper, the market leader, sells 25,000 vehicles. In terms of the number of cars, the relative market share of A-One will be 0.3 (7500 / 25,000). We get the same result if we first calculate the shares of A-One (7500 / 50,000 = 0.15) and Zipper (25,000 / 50,000 = 0.5), and then divide 0.15 by 0.5 (0, 15 / 0.5 = 0.3).

As for the revenue from car sales, A-One has $187.5 million per year, while Zipper, the market leader, has $375 million. Therefore, A-One's relative market share by revenue will be 0.5 ( 187.5 / 375). Due to relatively high vehicle prices, A-One's relative market share in terms of revenue is greater than in terms of number of vehicles.

Notes

Along with relative (and absolute) market share, other metrics need to be taken into account to get the full picture. To determine the maximum possible market share of an organization, it is necessary to take into account production volume, revenue volume and margins. There are many ways to measure market share. The simplest is to rank revenue volume or measure the absolute volume of products sold or gross income. The volume measurement is the starting point; further these measurements should be expressed in terms of the market share held by the company. Holding 70% of a market where you are losing money is not a suitable strategy. The main criticism of the relative market share indicator is precisely that it does not take into account the company's profit.

Market share characterizes the company's position in the market relative to its competitors. Quantitative indicator market share is determined by the percentage of sales volume indicators to the total sales volume of goods of the same category on the market.

Although market share is the most important indicator marketing activities company, there is no generally accepted perfect method for measuring it. The company's share can be calculated both in the market as a whole and within a specific segment served. Served segment - part of the total market volume for which competition is being conducted. In a situation where the sales volume in the market as a whole is unknown, the share is determined relative to:

relative to sales of a number of closest competitors;
relative to the market leader, leading competitor.

Market share can be determined in two ways:

in kind;
in value terms.

Market share in volume terms (in unit terms) - the number of units of a product sold by a particular company as a percentage of total sales in the market, expressed in the same units.

Market share by piece = Unit sales (quantity)
sales (%) Unit sales volume across the entire market (quantity)

This formula can, of course, be transformed to output either unit sales or total market unit sales from two other variables, as shown below:

Unit sales = Market share by unit sales (%) * Unit sales volume for the entire market

Market share in value terms (in sales volumes). Market share by volume differs from unit market share in that it reflects the prices at which products are sold. In fact, relatively in a simple way The calculation of relative price is to divide the market share by sales volume by the market share by unit sales.

Market share by volume =Sales volume (RUB)
sales (%) Total market sales

Market share through consumption intensity trademark known as Parfitt and Collins technique (R&S technique). For the calculation, data from panel surveys are used (i.e., research conducted on a permanent sample of consumers). The following formula is used for calculations (in %):

Brand Market Share = Brand Penetration * Brand Repurchase * Brand Consumption Intensity.

Brand penetration to the market is defined as the percentage of buyers of a given brand (who made a purchase at least once) from total number buyers who purchase goods to which this brand belongs over a certain period. Repeated purchase of a brand characterizes consumer commitment to this brand. It is defined as the percentage I of repeat purchases made by customers over a certain period from among those who have already purchased this brand at least once. Brand consumption intensity is calculated as the ratio of the average amount of consumption of a given brand by repeat buyers to the average amount of consumption by all groups in a given product category.

Number of impressions: 114321