One commonly used measure in comparing against competitors is market share. Is it an appropriate measure? Nearly every business is mesmerized by market share- keeping it or increasing it. Conventional wisdom about the importance of market share was that the biggest market share would give a company the biggest market share would give a company the biggest revenues and the lowest cost per unit. that approach may have worked in the past. However, the reality of today's enviroment is that increasing market share may not be the route to continued competitive advantage and profitabilty. Having the most customres doesn't automaically translate into having the most profits. In fact, ine study found that 70 percent of the time, the company with the largest market share didn' have the highest rate of return. Strategic decision markers need to address how customers needs are changing and how they can best meet those changing needs. Maybe that's how companines need to measure themselves against their comWhat do you think? Do you agree with the premises of this argument regarding the decreased importance of market share?petitors-- by how well they're meeting customers changing needs.
1. What do you think? Do you agree with the premises of this argument regarding the decreased importance of market share?
2. What are the implications for doing an internal analysis?
3. Are there customers an organization might not want?Explain.