Calculation
Penetration rate requires a well defined target market. In some cases, a total addressable market or serviceable available market is used. The other data item that is required is knowing how many unique customers you sold to in a period of time. The calculation of penetration rate is:penetration rate = (# customers / size of target market) x 100Example
A tour company on a resort island views all tourists to the island as their target market. In a given month, 1200 tourists visit the island and 300 take the tour. The penetration rate is calculated as:penetration rate = (300 / 1200) x 100 = 25%| Overview: Penetration Rate | ||
Type | ||
Definition | The percentage of your target market that you sell to in a period of time. | |
Value | Evaluating and formulating sales and marketing strategies. | |
Also Known As | ||
Related Concepts | ||
