Table Of Contents
Examples
Check out the following examples to get a better idea:
Example #1
The total value of cars sold in country X in 2022 is $16.8 billion. The revenue of the automobile companies in the country is given below. But first, let us find the share of the market leader.
P – $3.2 billion
Q – $4.1 billion
R – $2.4 billion
S – $5.6 billion
T – $900 million
Others – $600 million
Since S makes the highest revenue, it is the market leader.
Share of S = 33.33%
Example #2
The United States is currently the market leader in the microchip design market. Companies like Intel, Nvidia, Qualcomm, and others have contributed to the 46% global market share in 2021. However, the share has slipped from 50% in 2015. The main reason is the lack of government support for this sector. The Semiconductor Industry Association and the Boston Consulting Group estimate that the share of US companies in the sector will slide to 36% by the end of this decade if the government fails to offer support.
How To Increase?
Given the advantages of a high market share, businesses often look for ways to increase their foothold in the market. Let’s look at common ways adopted by firms for this:
- Innovation – It involves companies introducing new products and technologies that are anticipated by customers or will be easily accepted in the market. It is one of the most popular measures that firms adopt.
- Pricing – Another common method companies use is the market pricing strategy. Companies reduce the price of their offerings, usually less than the competitors’ price, to attract more customers.
- Promotion – Firms usually follow many methods that promote their products. These methods often aim to retain the existing customer base and acquire new customers. Attractive offers for first-time users and loyalty programs are some examples.
- Acquisitions – Acquiring another firm in the same industry (a competitor with a significant share or whose share can increase the acquiring company's share) allows the firm to gain its customers as its own.
Frequently Asked Questions (FAQs)
The global market share of the iPhone in the smartphone market as of Q3 2022 is 17.2%.
It is an important parameter that helps in determining the market leader. For companies, it helps them understand where they stand and thus develop strategies that help increase their shares in the market. For customers, it facilitates comparisons of companies with a good market reputation. Thus, it gives them a greater choice. It is an important indicator for investors too.
As of December 2021, Tesla held a share of 2.33% in the US market. Within the EV sector, Tesla has a share of 65%. CNBC reports that Tesla is still the dominant electric vehicle (EV) brand in the country, but cheaper EVs are gaining market.
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