Expert analysis · reviewed 6 Oct 2026
Share of wallet: measuring a customer's potential before trying to grow it.
Key distinctions
Three conditions before calculating.
What has been won is not what remains
A customer's revenue measures what they already buy. Share of wallet shows what they buy elsewhere, and therefore the real room for growth.
Total spend is estimated, not observed
With rare exceptions, a company sees only its own sales. Total spend is rebuilt from surveys, industry data or models based on the customer's size and activity.
A high share is defended, a low share is won
Customers with a high share mainly call for retention; those with a low share and high potential justify a development effort. The two do not call for the same actions.
Method
Measuring and using share of wallet in four steps
- 01Define the spending category
Specify which of the customer's spending falls within scope — the whole category, or only the part the offer can really serve.
- 02Estimate total spend
Rebuild the spend of each customer or segment from surveys, panels or a model linked to their size, and document the margin of error.
- 03Calculate share and potential
Divide captured sales by estimated spend, then calculate the remaining potential in value, not only as a percentage.
- 04Allocate effort to potential
Rank customers by remaining potential valued at margin, concentrate commercial or marketing effort on them, then measure its effect against a control group.
At equal revenue, a visit sixteen times more profitable
Illustrative example: customers A and B each generate €40,000 of revenue. Their estimated category spend is €50,000 for A and €200,000 for B. Assume a sales visit captures 2% of the remaining potential, with a margin of 30%.
Customer A: (€50,000 − €40,000) × 2% × 30% = €60 of margin per visit. Customer B: (€200,000 − €40,000) × 2% × 30% = €960 of margin per visit.
At equal revenue, a visit to B brings in sixteen times more than a visit to A. Allocating visits in proportion to revenue would have split them equally between two customers with opposite potential.
Acceptance conditions
What must be true to act.
- 01
Always express remaining potential in value, not only as a share.
- 02
Document the source and margin of error of every estimate of total spend.
- 03
Do not allocate development effort in proportion to current revenue.
- 04
Distinguish retention actions, for high shares, from conquest actions, for low shares.
Limits
What this analysis does not prove.
- A wrong estimate of total spend shifts every priority; it must be checked on a sample.
- A low share may reflect a deliberate choice by the customer, such as a multi-supplier policy, which is hard to change.
- Share of wallet says nothing about the margin the customer would leave on the potential won.
- A customer's potential changes with their activity; it must be re-estimated regularly.
References
Works cited.
- Du, Kamakura and Mela (2007), Size and Share of Customer Wallet (opens in a new tab)
- Cooil, Keiningham, Aksoy & Hsu (2007), A Longitudinal Analysis of Customer Satisfaction and Share of Wallet (opens in a new tab)
- Keiningham, Cooil, Aksoy, Andreassen & Weiner (2007), The Value of Different Customer Satisfaction and Loyalty Metrics in Predicting Customer Retention, Recommendation, and Share-of-Wallet (opens in a new tab)