Customers and pricing
Relative market share
Our share divided by the largest competitor's share.
Facts checked against sources onWhat does Relative market share mean?
Relative market share is our market share divided by the share of our largest competitor. With 15% against a leader at 45%, our relative share is 0.33. If we are the leader, it is our share divided by the number two player's. The BCG growth-share matrix uses it.
Where does it come up in case interview prep?
Related terms
- Market shareOur sales as a share of total market sales.
- BCG growth-share matrixSorting businesses by market growth and relative market share.
- TAM, SAM and SOMTotal market, the part you can serve, and the part you can win.
- Penetration rateThe share of potential customers who already use the product.
- Share of walletOur share of what one customer spends in the category.
- ARPU (average revenue per user)Revenue divided by the average number of users.
- AOV (average order value)Revenue divided by the number of orders.
- CAC (customer acquisition cost)What it costs, on average, to win one new customer.
Learn it in context
See Relative market share at work in a lesson from Business basics for non-business learners, with checks as you go.
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