What is meant by share of customers?

The term "share of customers" refers specifically to the portion of customer spending that a company captures within its relevant product categories. This metric indicates how much of the overall consumer expenditure in a given market segment goes to one particular company, reflecting its ability to attract and retain customers compared to its competitors.

Understanding share of customers is crucial for businesses as it helps them gauge their competitive position in the market and identify opportunities for growth. By tracking this metric, companies can make informed strategic decisions, such as improving customer service, refining product offerings, and enhancing marketing strategies to increase their share.

The other options focus on different concepts: market sales percentages relate to overall market share; the total number of customers in a market gives a demographic insight without indicating spending patterns; and the ratio of new customers to total customers highlights customer acquisition, which does not directly address how much spending a company captures.