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KPI for Measuring of Customer Wallet Share posted in category Sales

WinningKPI - Sales - KPI for Measuring of Customer Wallet Share posted in category Sales

KPI details:

This indicator is for measuring the % of a customer’s budget for a product category, which is spent on purchasing that product from Company A, over a given time period (e.g. annually).

More details:

The Customer Wallet Share is a very important element for any company, and there is a very high competition on all markets for companies to maximise this KPI.

For instance, a customer annually spends $1000 on purchasing internet connection, $700 for home Wi-Fi connection from Company X and $300 for a 3G connection on Smartphone from Company Y. In this case, Company X has a 70% of the customer’s wallet share, whilst Company Y only has 30%.

Company Y may set a KPI to increase that wallet share to 100% in the next quarter, by offering the customer a better joint deal on both home WIFI and 3G connection.

Formula:

Budget spent on Company X product/ Total budget for product x100

KPI units: %

KPI time frame: update quarterly or yearly

Posted by KPI Expert | Help to protect community: Flag for moderation

Ideas suggested by WinningKPI community:

Here are comments:

Loyalty, customer retention and customer wallet share go hand in hand. If a business can achieve and increase all of them, that is the key to success.

Promotions, loyalty cards (accumulating points), discounts cards etc. are measures that foster growth in customer wallet share.

The reason why a customer will choose to buy from you instead of your competitor is because you are better or because you gave the customer a reason to purchase only form you.

Brands and brand images tend to have power to increase customer wallet share.

Apple has my 100% wallet share in the mobile phone industry, as for years I have not purchased from another company; somehow they convinced me they are the best.

During University I shopped almost only at one clothes store, because it offered the highest student discount.

Becoming the ‘better’ choice in the customer’s mind is vital to increasing wallet share.

KPI Expert | September 6, 2012 at 8:30 am

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