One thing that keeps the digital marketers worrying is to select the best measurements for getting metrics. When you can count every click and scroll, the hesitant marketer could quickly develop analysis paralysis.
If it sounds similar to you, you can consider the online measurements like charting a map while exploring. It will record where you have been and also help you in your next direction. With this in mind, measuring share of voice and share of the market are the best ways to start.
Share of voice and share of the market provides an overview of the business landscape which helps you to market their products or services. With the help of the right tools, the SOV and SOM will help you to get more profound insights to explore the marketing opportunities.
What is the share of voice?
Share of voice is defined as an individual brand’s percentage of the total spending for the category for a specific period.
Graph showing the share of voice
What is the share of the market?
Share of the market is defined as the brand’s percentile of the total sales for the category for the same period of SOV.
Graph showing share of the market of a solar cell manufacturing company
Why is the share of voice significant than the share of the market?
Based on the Harvard Business Review, there is a connection between the advertising spending and market share based on an analysis of Share of Voice compared to the Share of the Market.
Most of the exporter marketers are in the statue of equilibrium, where SOM and SOV remain the same. The individual brand remains in a relative state of balance where its SOV approximates its SOM. The equilibrium occurs with the competition when the primary market share leaders stay within 10% of each other’s share of voice.
The market leader’s share of voice is less than its share of the market. When the share of voice decreases, the marketer is vulnerable to challenges. And the decrease in the share of the market of established brands starts to occur when a brand’s share of voice always falls below its share of the market by 4% of more.
If you are a smart marketer, you should invest a little more in a share of voice than a share of the market. To gain significant improvements in the share of the market, you just need to create or exploit disequilibrium by using advertising spending as an offensive weapon based on competitive analysis.
To increase your share of the market, you must double your share of voice which might need 18 months approximately and also 25% total spending for that category. To win the share of the market, it is best to invest in the market where the competitors are underspending, i.e. not protecting their share of the market. Cutting the ad spending for generating short-term profit can make you lose competitive ware.
How to beat the competition with the share of voice and share of the market?
As per the IDC report, the digital market is expected to grow from 130 exabytes to 40,000 exabytes which are nearly 300% more. The marketers will be struggling to find the information necessary to reach their customers. Still, they will be unable to harvest the data to see what is required to maximize their brand value.
Today’s marketers can harness the massive amount of digital data collected from multiple sources to understand the competitive landscape in various platforms. You can measure your brands and your competitor’s SOV and SOM and identify the areas where your competitors are behind. You can optimize, refine and align your digital marketing campaigns, investment, and assets to maximize the conversations in all the buying platforms.
The share of voice and share of the market helps the marketers to identify the hidden opportunities within their market and increase conversion and revenue.