10 Ways to Increase Your Product Market Share

A definition of product market share

There’s no need to get too technical here. Your market share is simply the percentage of the market or sector that you are responsible for, according to your sales. You can calculate the market share of a single digital product, or a service that you provide, or your business as a whole.

The importance of market share

Whether for a product or a business, market share is a practical and useful metric. Firstly, it indicates a basic level of success (or otherwise) – if we imagine the market as a body of water, are you a big fish in a small pond, or the opposite? Maybe you operate in an ocean, not a pond – you might still be a big fish. Either way, the largest market share indicates the market leader.

So, market share is a way of comparing your success to that of your competitors – your competitive advantage. As such, it offers insights into the effectiveness of your marketing, advertising, sales team, product development, or any other activity that drives market share. Market share is also important because it is used as an indicator by investors, especially in a growing market – if you maintain your share, your revenues are increasing with the market; if your share is increasing, your revenue is growing faster than your competitors’. Consequently, changes in market share can also affect stock performance.

What is your market share?

Calculating your market share is relatively straightforward. For the business as a whole, decide on a fiscal period (a month, a quarter, a year, multiple years…) and divide your total revenue or sales for that period by the sector’s total revenue or sales to find your share.

For a product, the calculation is the same, but you substitute the sales of the product and the sales of all comparable, competing products on the market.

Usually, this calculation is done for a country or territory; e.g. for the US or for North America, or for Poland or for Europe.

Top 10 ways to increase market share

As simple as it is to define market share, increasing it is less easy. In the words of one of Boldare’s product strategists, “Increasing market share can be a complex task that requires a strategic approach… the specific methods may vary depending on your industry and business.” That said, here are 9 general tactics to consider when creating a market share strategy.

1. Understand your target market: Before you can boost sales and revenues, you need to understand your potential buyers. Conduct thorough market research to identify your target users’ needs, pain points, preferences, and behaviors. Use this deeper understanding to tailor your product(s) and marketing tactics to better meet their demands.
2. Differentiate your offerings: How do you stand out from the competition? Identify your unique selling points from the buyer’s perspective. For each product, develop a value proposition that resonates with its target market, emphasizing the benefits they can gain with you alone.
3. Enhance product quality: Your product(s) should offer exceptional quality and user satisfaction. Use customer feedback and market trends to continuously improve your offering. Quality products generate word of mouth recommendations and attract new customers.
4. Competitive pricing: Part of your market research should focus on pricing. What are competitors charging for comparable products? Thoroughly evaluate your costs, the market, and user expectations to create an optimal pricing structure that maximizes your market share. You don’t have to be the cheapest, but you do have to offer value for money.
5. Effective marketing and promotion: The best product in the world won’t achieve a share of the market if nobody knows about it! Develop a comprehensive marketing strategy to raise awareness and promote your product and your brand. This includes utilizing a variety of marketing channels (social media, advertising, content marketing, public relations, etc.) that will convey your unique value proposition to the widest possible segment of your target audience.
6. Expand your distribution channels: New (and old) customers can be reached by using new distribution channels – the easier it is for users to get their hands on your product, the more you will sell. This could include partnerships, collaborations, e-commerce platforms, or even brick-and-mortar. Accessibility is key.
7. Build customer loyalty: Users who value what you are not just customers, they’re fans. Fans are loyal, they become brand advocates and recommend you to others, increasing your reach. Provide excellent customer service, consider loyalty programs, and seek user feedback to continuously improve your product.
8. Innovation and continuous improvement: A product or business that stands still loses market share. Market leaders tend to have an organizational culture of innovation. Invest in R&D and enhance your products, services, and processes. Products that continue to evolve (in line with user needs and wants) increase their market share.
9. Monitor and adapt: Complacency is fatal. And markets can change suddenly in a VUCA world (consider for a moment the global impact of an unforeseen pandemic over the last few years). Monitor market trends, competitor activity and customer feedback. Agile market leaders are ready to adapt their strategies as necessary.

Which of these strategies are critical to increasing your market depends on your specific business, product and market. One thing is true for all, though, and that is increasing market share is a long-term strategic endeavor that ultimately relies on delivering value to your customers and users.

Maintaining market share

Continuing on from strategy #9 above, markets can change, and if a competitor is expanding their market share – through price-cutting, innovative new products, or a new marketing campaign – it could be at the expense of yours. So, how can you prevent loss of market share for your business or product? As we’ll see, many of the strategies for building market share are also necessary to maintain it.

• Product innovation – No product is ever perfect or complete; at least, not while the market is constantly evolving. Avoid obsolescence by staying abreast of new technologies and innovations, and incorporating them appropriately into your product(s) in line with what product users are telling you they want and need.
• Plug the gaps – Sometimes it’s not a case of improving a product, a new product is necessary. Monitor the market for emerging new needs or user pain points. These represent gaps in the market (perhaps new technology opens up new possibilities, or perhaps the arrival of new customer needs expands the current market). If you don’t have a product to meet the needs of this expanded market, rest assured that a competitor will! One strategy is to develop new products or brands to plug these emerging gaps.
• Confrontation – While this is not an ideal or recommended option, sometimes this can get ugly. Competitors and their products can be confronted through price-cutting, aggressive marketing, or even undermining the competing products. In some ways, this kind of strategy belongs to a previous age of business, but there’s no denying that it still happens.

Increase and protect your market share

Your market share – whether business or product-related – is a metric that reflects the success of your organization. Understanding how market share works, and the impact it has (including on your business reputation and product desirability) can be vital for any business; especially one looking to scale up or boost profitability.