What Is the Difference Between Sales Measurement and Market Share

question 44

Essay

What is the difference between sales measurement and market share? Give example of both methods. ANS The basic unit of measurement is the sales transaction. A sales transaction results in a customer order for a specified quantity of an organization's product sold under specified terms by a particular sales person or sales group on a certain date. Many organizations record these bits of information about their transactions. With such a record, a company can analyse sales in terms of cash or sales volume, or market share. A company's market share is the company's sales of a product stated as a percentage of industry sales of that product. The primary reason for using market share analysis is to estimate whether sales changes have resulted from the company's marketing strategy or from uncontrollable environmental forces. When a company's sales volume declines but its share of the market stays the same, the marketer can assume that industry sales declined - because of some uncontrollable factors - and that this decline was reflected in the company's sales. However, if a company experiences a decline in both sales and market share, it should consider the possibility that its marketing strategy is not effective. PTS: 1 DIF: Easy REF: Methods of evaluating performance 10. What is market shareholder value analysis?

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Definitions:

Media Production

The process of producing media content, from conceptualization through to the final output, covering various formats such as film, television, and digital media.

Acquisition Differential

The excess amount paid over the net asset value in a company takeover, reflecting intangibles such as the target's brand, customer relationships, and synergies expected from the merger.

Comparative Consolidated Financial Statements

Financial statements that present the combined financial position and operations of a parent company and its subsidiaries, along with comparative data for previous periods.

Net Income

The amount of profit left over after all expenses, taxes, and costs have been subtracted from total revenue.