What Is Share of Wallet?
Share of wallet measures what percentage of a customer's total spending in your category goes to you versus competitors. Growing share of wallet is often more profitable than acquiring new customers.
Key Takeaways
- Share of wallet = your revenue from a customer ÷ their total spend in your category × 100
- A high share of wallet signals strong customer lock-in; a low share signals a cross-sell or competitive threat
- Growing share of wallet from existing customers is typically cheaper than acquiring new ones
- You need to know total category spend — which requires asking customers directly or using market research
What share of wallet measures
Share of wallet (SoW) is the percentage of a customer's total spending in a given category that they allocate to you. If a retailer spends £200,000 per year on packaging and buys £60,000 of that from you, your share of their packaging wallet is 30%. The remaining 70% goes to competitors — meaning there is 70% of their spend you are not capturing.
Why it matters more than revenue alone
Revenue tells you what you have. Share of wallet tells you what you could have. A customer spending £60,000 with you might be a great account — or they might be spending £500,000 in total and giving 88% to your competitors. Without share of wallet data, you cannot distinguish between a fully-penetrated account (no growth available) and an under-penetrated one (significant cross-sell opportunity). Customers with low SoW but high total category spend are your most valuable growth targets.
How to find out a customer's total spend
The honest approach: ask. In B2B sales, it is common and professionally acceptable to ask a customer: 'How much do you spend on [category] in total each year across all suppliers?' Many will tell you, especially if you frame it as part of a review or strategic planning discussion. Indirect signals: the size of the customer's operation (headcount, revenue, number of locations) can be used to estimate category spend based on industry benchmarks.
How to grow share of wallet
The most effective levers are: expanding the product or service range you offer to the customer (cross-selling adjacent categories); deepening usage of existing products (ensuring the customer is using the full value of what they have); improving service quality to displace incumbent suppliers; and proactive account management that identifies new needs before the customer turns to a competitor. Set a SoW target for each key account as part of your account management process.