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How to grow market share
No matter how successful you are as a business owner, you’re always going to face an urgent need to uncover new opportunities. You cannot let your company plateau instead of pursuing tremendous growth. Yet the market is changing. Passive “farming” sales strategies are not as viable as they used to be. You must learn how to grow market share in new ways.
Looking inside your own organization and finding efficiencies is key, but there is power to be found in reaching outside your business as well. If you’ve ever wondered, “What is market share and how can I grow mine?” we have the definitions and strategies you need.
What is market share?
Your market share is the percentage of the total market that you control. In other words, it is your percentage of the total sales of your industry. There are two types of market share: value and volume. Value market share is calculated based on revenue, while volume market share is calculated based on units.
You can determine your value market share by taking your company’s revenue over a certain time period and dividing it by the total revenue in your industry over the same time period. As one example of market share, if you sold $50,000 worth of left-handed scissors in a year, and overall sales of left-handed scissors were $500,000, you would have a 10% market share.
Your volume market share is calculated similarly, but you will take the number of units you sold and compare it to the total sales of units of that product. So, if you sold 10,000 pairs of scissors, and the total number sold was 50,000, you would have a 20% market share using this example of market share.
Why is it important to grow market share?
Learning how to grow market share has numerous benefits for your business. When you control more of the market, you have a competitive advantage. Customers already know and prefer your brand, so you can sell more with less effort. You might be able to negotiate better prices with your vendors. And you’ll create a barrier to entry for anyone who wants to get into your industry.
Apple represents an ideal example of the importance of market share. In the United States, Apple’s smartphone market share was 42% at the end of 2021, ahead of the next-closest competitor, Samsung, and far beyond other competitors who have less than 10% market share. This commanding lead gives Apple the ability to completely control its own supply chain, strike better deals with partners like music and media companies and command premium pricing on its smartphones.
So what is market share, really? It’s your ability to stay competitive and beat your competition – and it’s vital to your business success.
How to grow market share
With a little ingenuity and some wisdom from Tony Robbins and business guru Jay Abraham, you can learn how to expand your market share. Here are six effective and fresh strategies you can put into action today to attack new markets and increase your revenue.
1. Get personal
Thanks to today’s highly social marketing methods, your business can foster and develop many one-to-one client relationships. It’s imperative that you engage in these customer conversations because one long-held principle is still true: On average, less than 25% of leads are ever contacted.
To grow market share, you need to snap up the prospects being overlooked by your competitors. Create targeted ads on social media to help you expand share and influence over the market. Tap members of your team who are social-media savvy to monitor how other businesses are drawing in customers. Have someone from your team respond directly to customers on your social media channels and never miss an opportunity to capture leads.
And if you don’t have a social media presence, get one. Neglecting your social media is cutting out a huge portion of the market, and since you want to focus on how to expand market share, you cannot overlook this key – and free – component.
2. Create and maintain momentum
Every day you are sitting around wondering, “What is market share?” without taking action is a day someone else is taking market share and revenue away from you. An effective sales team is one that focuses not only on active demand, but even more so on latent demand. How can you reach current and prospective customers during your slow season? How can you create a raving fan culture that incites your customers to tell their friends and family about your brand? That’s how your business can create and maintain momentum – and you can unlock how to grow market share.
3. Develop effective leadership
Organizations struggle with prospecting because many sales people are not comfortable with it. Whether you’re a multi-million dollar company or an army of one, it’s your sales force that needs to go the last mile in attacking and capturing new markets. Fortunately, cloud technology can be very effective in scouting business prospects.
Whether you’re relying heavily on technology or a human team, make a refined strategy. Who’s responsible for leading the charge on prospecting? How are you measuring success or setbacks when it comes to reaching your market share goals?
Develop a calendar and goals that fit your business needs and check in on a monthly basis. Are you hitting your business goals – why or why not? At the end of each month, reevaluate your approach, work with your sales leaders and tackle the issue head-on. You can always work with a Results Training Coach if you feel that you need outside perspective on how to expand market share.
4. Maximize efficiency
The past several years of economic uncertainty have caused many organizations to downsize. Now that markets are expanding again, businesses are being confronted with the daunting task of doing more with less – like driving 20% more revenue with 20% fewer people. To grow market share, you must harmonize your resources with your level of demand.
With that in mind, what is market share for a small business? If you have a smaller workforce, don’t push your employees to their breaking point to reach an unattainable goal. Scale your expectations. You want to maximize efficiency within your organization while also giving your team the support they need to thrive. That way, you avoid burnout and receive outstanding results.
5. Build a mega partnership
Your business is not an island. You depend on others to make your business work (e.g., your suppliers and customers). But have you thought about building a mega partnership with another business? You might think that your business is too small or too niche or too new to build a partnership and grow market share. That’s where you’re wrong. As Jay Abraham reminds us, anything that financial capital would buy could be solved by finding the right partnership.
It’s all about finding the right fit. Don’t cut out potential because your business lacks financial capital. If you know that you can provide the skilled labor to make another business run more effectively, then you can focus on how to grow market share by approaching a larger business. Expand share by knowing what your business does well. Then, approach another business with a clear proposal of what you can do for them. It’s okay if you’re not bringing financial capital to the table. Having the full force of your business behind you is your capital.
Another way to build a mega partnership and expand share is to secure an endorsement. As Jay Abraham reminds us, businesses can be better together; a true mega partnership benefits both companies. Securing an endorsement could give your business credibility while allowing another company to project growth.
6. Go global.
It seems that almost overnight, the world has evolved into one giant market. There are challenges to branching out internationally (like training, evaluating and managing sales teams between continents) but the benefits can far outweigh the costs. Through managed expansions or channel partner relationships, your business can discover how to grow market share in any corner of the globe.
One way to feel more involved with global operations is by hiring local market industry experts to work with you in-house. These team leads can then communicate with your business’ representatives all around the globe in their native language and report back to you with results.
“Tony Robbins is the ‘ultimate coach’ for that special breed of men and women who will never settle for anything less than they can be.” —Pat Riley, Hall of Fame NBA Coach