How can Companies Increase Market Share?

There are multiple ways in which companies inculcate to improve their market share. Some of these ways are as follows:

1. Innovative Technologies

Innovation is one of the best ways to increase market share. There can be different forms of innovation such as innovation in product, innovation in the production method, or introduction of a new technology in the market which would give a blow to the competitors. Innovative techniques can give an edge to the company over its competitors and provide a dominating position in the industry. This method would attract customers which would add to the company’s market share.

2. Enhance Customer Relationships

Building customer loyalty is an important technique to gain market share. Strengthening customer relationships would help the companies protect their existing hold on the market by avoiding the exit of present customers due to attractive offers by competitors. By focusing on relationship building, companies can build customer satisfaction which would help in increasing customer base due to word-of-mouth from the satisfied customers to their near and dear ones.

3. Acquisitions

A strong method to increase market share is acquiring a competitor and increasing dominance over the industry. The acquisition helps the company to increase its customer base as customers from the acquired company would also fall in the customer base of the new company. This would reduce competition in the market and finally increase the market share. Thus, when a company is in the growth industry, the management often seeks to acquire a competitor for their advantage.

4. Reduce Prices with Better Quality

By reducing the prices of products and services, companies can expand their market share as low price attracts more customers. If the number of customers is increased, then there will be more sales which in turn increases the market share of the company. Further, in the current era, customers purchase those products which are high in quality.

5. Hire Talent

If talented employees are on board, the companies need not focus much on training or turnover rather they can devote their time and resources to building core competencies. Best talented employees can be hired by providing competitive salaries and benefits including flexible schedules and casual work culture.

The part or percent or amount of a market obtained by a company is termed the Market share. In simple words, market share defines the total sales of a company compared to the total sales of the entire industry in which it operates. This gives a proportionate percentage of the company among its operating industry. If market share is viewed from the customer’s perspective, then market share would be the percentage a company holds among all the purchases made by the customer in a particular product or service. For example, if a consumer purchases 100 bottles of shampoo as a whole and a certain shampoo maker sells 30 bottles, then the particular company holds a 30% market share. This calculation of the market share holds a company’s total sales over a particular time frame and the total sales of the industry operating within that period.

Geeky Takeaways:

• Market share is the part or percentage of a market gained by an organization or a company. The total sales of a company about total sales of the industry is the market share of the company.
• If market share is viewed from the customer’s perspective, then market share would be the percentage a company holds among all the purchases made by the customer in a particular product or service.
• This calculation of the market share holds a company’s total sales over a particular time frame and the total sales of the industry operating within that period.
• The company that has the highest market share and usually holds the maximum influence over the market is known as the Market leader in an industry.
• There can be two types of market share: Value share and Volume share.