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Could Market share and Brand penetration be calculated as the same percentages?
A certain percentage of a city's population uses a type of product and the percentage of brand choice between several brands is provided. The percent of each brand is multiplied by the total units sold and that result is divided by the total number of units sold, giving a market unit share equivalent to each brand percentage given. The number of product users is multiplied by each brand's percentage of choice and the result is divided by the total number of product users, not the total city population, also yielding the same percentages as each brand choice and the market unit shares. It seems off to me, but does this make logical sense?
1 Answer
- Don GLv 73 years ago
Seems like you are just going around in circles. Say 20% of a population of 1.0 mil uses this type product. That means 200,000 people. The % of brand choice is: Brand A - 40%; Brand B - 50%; Brand C - 10%.
Say total units sold is 20,000. So A = 8,000, B = 10,000, C = 2,000. Dividing the result by total units sold gives you the same %, or market unit share equivalent. Total product users of 200,000 x Brand A's 40% = 80,000, Brand B's 50% = 100,000 and Brand C = 20,000. The result divided by the number of users, 200,000, means A = 40%, etc. So you're back to the original brand choice %.
So of course Market Share and Brand Penetration are the same.
