Market share is like a popularity contest for FMCG brands. It’s all about how much of the pie you get to eat – or, in this case, how much of the market’s attention and money you’re able to capture. Let’s be real, who doesn’t want a bigger slice of the pie?

In a nutshell, market share refers to the percentage of total sales in a particular market that your brand is able to capture. For example, if your brand’s sales are $10M and the total market sales are $100M, then your market share would be 10%. The higher your market share, the more successful your brand is in the particular market.

Why is market share so important?

For starters, it is by far the most important metric to keep an eye on because it’s a direct reflection of how well your brand is performing against your competitors. If your slice of the pie is getting bigger, it means you’re gaining ground on your rivals and are becoming a bigger player in the market. On the flip side, if your slice is shrinking, it’s a sign that your competitors are eating your lunch and you need to up your game.

Another reason why market share is important is that it is a direct result of your sales volume and sales value. Generally speaking, the higher your share, the more sales you’ve made and the more money you’ve generated. But there’s more to this than just making a quick buck. Having a high market share means more people moving through your brand funnel. When people recognize your brand and see that your brand is popular and successful, they’re more likely to trust and value it. And if they feel like your brand is meeting their needs better than your competitors, they’ll keep coming back for more.

Market share also plays a role in determining where your brand’s products should be sold and how they should be marketed. If you have a high market share in a particular retail chain, for example, it might make sense to focus your efforts on expanding your presence in other chains rather than making a little extra impact in the same chain. Similarly, if you have a low market share in a particular product category, you might need to invest more in advertising or product development in order to create awareness and differentiate yourself from your competitors.

Watch outs

Don’t get too caught up in the popularity contest. Although it’s the most sought-after metric in brand performance, it’s important to keep in mind that it’s not the only metric. A great share doesn’t necessarily mean that your brand is doing everything right – you still need to focus on providing quality products and excellent customer service to maintain long-term success.

Moreover, it’s worth noting that in some markets, having a lower share can actually be an advantage. For instance, if you’re operating in a niche market with unique and specialized products, you may not need to capture a huge share of the overall market to be profitable. In fact, trying to compete for a larger share in such a market could be counterproductive, as it might require sacrificing the quality or uniqueness of your products. In other words, sometimes it’s better to focus on being the best in a small segment of the market, rather than trying to be everything to everyone.

Influencing market share

Overall, market share is a critical metric for any brand manager working in FMCG. By keeping an eye on your slice of the pie and understanding the factors that influence it, you can make informed decisions about how to allocate your resources, where to focus your efforts, and how to stay competitive in a constantly-evolving market. Understanding consumer needs, developing strong brand identities, offering the right price, and investing in marketing and advertising are all essential tools for a brand manager to improve market share and ensure sustained growth and profitability.

Think of it like being a master chef in a baking competition, you need to have the right ingredients and skills to win it.