Glossary
Market Share
The slice of a market a company holds
Market share is the portion of a market a company holds. Sell 3 million in a market totalling 10 million and the share is 30%.
Share matters because scale is power. Selling more lowers unit costs, strengthens negotiating position and builds recognition. That is the structure by which the leader grows more advantaged over time.
High share is not automatically good, though. Share bought by slashing prices means losing money on every sale, which is why share and margin must be read together.
The direction often matters more than the level. A company going from 10% to 15% is sending a better signal than one sliding from 40% to 35%.
Whether the market itself is growing matters too. Gaining share in a shrinking market amounts to standing still or retreating. Share and market size always belong in the same sentence. Check how the company defines its market, too. Drawing the boundary narrowly inflates the share, so it is safer to examine the basis behind any published figure.