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Market Share Analysis

 

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Market Share Analysis Market share analysis is a method of exploring how well a business operates in the marketplace, compared to its competitors. Read the following Market Share Checklist to learn about the steps of carrying out this kind of analysis. The checklist is designed for sales analysts, marketers and other specialists involved in market research.


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Define Goals.

  • To reach economies of scale through higher volume and lower production costs; or
  • To grow sales in a stagnant market through more intensive marketing; or
  • To build fine reputation through a range of marketing campaigns to ensure an increase of market share; or
  • To increase bargaining power through negotiating with more suppliers and channel members

Analyze Drivers of Market Share.

  • Driver #1. Share of preference – analyze the pricing and promotional changes of your product to understand whether you can increase your market share though this driver
  • Driver #2. Share of voice – explore the ratio of your company’s promotional expenditures and total promotional expenditures in the market to determine whether you can drive the market through improved advertising
  • Driver #3. Share of distribution – research the distribution channels your firm uses in order to figure out sales effectiveness and understand whether your market share can be increased through more intensive distribution

Analyze Variables of Marketing Mix.

  • Variable #1. Product – consider changing some attributes of your product/service in order to check whether you can provide higher value to customers and thus strengthen your position in the marketplace
  • Variable #2. Price – explore the price elasticity of demand to understand whether you can decrease price for reaching higher sales revenue
  • Variable #3. Distribution – determine what new channels can be added to your distribution network and then analyze whether these changes will increase your market share
  • Variable #4. Promotion – considering increasing advertising expenditures for growing your market share, unless your competitors do not use the same strategy

Assess Competition.

  • Identify and research all the competitors playing in your marketplace
  • Explore their products and services and then determine their unique selling propositions (USPs)
  • Break down your competitors into two groups – direct and indirect
  • Direct competitors – determine whether your customers are likely to purchase your product instead of the competitors, when they make buying decisions
  • Indirect competitors – figure out whether your firm can overcome the competitors that go after your customers in different and unexpected ways
  • Perform SWOT analysis to understand your firm’s strengths and weaknesses along with competitive threats and opportunities
  • Explore how well your business exploits its opportunities and strengths when trying to overcome the competition
  • Determine how well your business is protected against threats and weaknesses

 Improve Market Situation.

  • Check if your business is able to increase labor or supply costs that can impact your pricing and thus market share
  • Be sure to adjust the company’s policies to any new rules or regulations
  • Consider using technologies to improve product quality and strengthen your competitiveness
  • Monitor consumer trends and demands to be able to respond to shifting consumer preferences
  • Arrange regional or industry promotional events that can impact visibility of your offerings
  • Increase current number of clients through improved prospecting and lead generation
  • Start exploiting markets segments that provide the best.....


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