What is meant by 'market share'?

Market share refers to the percentage of total sales in a specific market that is controlled by a particular company or brand. This metric is crucial for understanding a company's standing in the market relative to its competitors. By measuring market share, businesses can assess their performance and market presence, which can inform strategic decisions regarding marketing, pricing, and resource allocation.

Understanding market share allows companies to identify growth opportunities, analyze competitive strengths and weaknesses, and evaluate the overall market dynamics. A higher market share often indicates a stronger competitive position and can lead to economies of scale, increased brand recognition, and greater customer loyalty. This concept is fundamental in marketing because it provides insights into market trends and consumer preferences.