Market penetration is the percentage of your target market that you sell to in a period of time.Market share is the portion of the total value of a market that is captured by your products, services or brand.
DifferenceMarket penetration is the percentage of customers you reach at least once in a defined period of time. It is often calculated relative to a target market that can potentially be much smaller than the market as a whole.Market share is typically calculated for a total addressable market or the portion of the market that a firm can reach. It is based on your revenue as a percentage of the total sales of an industry or market.
ExampleA software services firm targets 2,000 corporate customers and sells to 1,000 of them. This represents a market penetration of 50%. Their revenue from these sales represents a market share of 2.2% of the total market for business software.
|Market Penetration||Market Share|
|Definition||The percentage of a target market that buy your products, services or brand in a period of time.||The percentage of total sales in a market captured by a single product, service, brand or company.|
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