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Glossary

Share of wallet

The portion of a customer's total spend on a category that you hold. Your revenue from the customer divided by everything they spend on what you sell.

DefinitionThe portion of a customer's total spend on a category that you hold. Your revenue from the customer divided by everything they spend on what you sell.

How it is computed

Share of wallet = your revenue from the customer ÷ the customer's total spend on the category

The numerator is in your systems to the penny. The denominator, the wallet, never is. It comes from a benchmark provider, the customer's own disclosures, or an estimate from the customer's size and a typical spend ratio. Record which one was used per customer.

By product

Share of wallet is most useful per product line: a customer at 60 percent in one line and 5 percent in another has a specific opportunity in the second. A single blended share hides it.

Levels

Sum revenue and sum wallet across customers before dividing. Never average the customers' shares; a small customer at 80 percent and a large one at 5 percent is not 42 percent.

Penetration is share of wallet's cousin for products rather than money: of the products a customer could buy, how many do they buy. Whitespace is the gap expressed as a list of products and a value. Hit ratio is the trading desk's version, counted in requests won rather than revenue.

How it is computed

Your revenue from the customer in a category divided by the customer's total spend in that category, where the total is stated by the customer, taken from public data, or estimated from similar customers, with the source graded.

Example

A customer spends about $500,000 a year on the category and buys $110,000 from you: 22 percent. Similar customers give you a median of 45 percent. The gap to the norm is $115,000.

Where it goes wrong

A denominator nobody states. Share is quoted with no indication of where the customer's total came from or when.

Articles that use this term

AI and self-service analytics

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Account hierarchy: parents, subsidiaries and the level you actually sell to

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16 Sept 20263 min readTerritory, capacity and quota planning

Activity and outcome measures: which belong in compensation, and which do not

Why paying reps on activity measures produces activity and paying them only on outcomes produces sandbagging, the three tests a measure passes before it goes into a plan, the rep controls it, it cannot be gamed by logging, and it reconciles to a ledger, which coverage and outcome measures pass, which fail, the coverage-at-cadence exception that passes all three, and the identity that every credited dollar in a plan is a ledger dollar once.

16 Sept 20263 min readWallet share and penetration · Industrial manufacturers

Aftermarket attach: installed base against parts and service revenue

How an industrial manufacturer measures aftermarket capture per customer from the installed base register and the parts and service ledger: expected annual aftermarket per unit from the customers who buy it all from the OEM, actual per customer, the attach rate, and the list of customers running the OEM's equipment on someone else's parts, ranked by the revenue at norm.

16 Sept 20262 min readAI and self-service analytics

Asking questions of a sales workbook without rebuilding it in a BI tool

How a team whose data lives in Excel or Google Sheets can ask plain-English questions of the workbook they already keep: reading the structure as it is, mapping columns once, validating the totals, and getting answers with the rows behind them, without pivot tables or a data warehouse.

16 Sept 20263 min readBoard and management reporting · Finance and FP&A teams

Automating the sales report: from a manual monthly pack to computed tables

A practical path for a sales operations or finance team that assembles the monthly sales report by hand: what to automate first, the definitions that have to be written down before anything can be computed, the four exports the whole pack comes from, the identity checks that replace the reconciliation week, what stays manual, and the order in which the pack's sections move from spreadsheet to computed table.

16 Sept 20263 min read