What is share of wallet in SAP CRM-ANA - CRM Analytics?

SAP Term: share of wallet

• Component: CRM-ANA

• Component Name: CRM Analytics

• Description: The share of a customer's buying potential that a company commands.

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• Key Concepts: 
  Share of wallet is a term used in customer relationship management (CRM) analytics to measure the amount of money a customer spends with a company relative to the total amount they spend on similar products or services. It is used to measure customer loyalty and the effectiveness of marketing campaigns. 
  
  How to use it: 
  Share of wallet can be used to measure customer loyalty and the effectiveness of marketing campaigns. It can be calculated by dividing the amount of money a customer spends with a company by the total amount they spend on similar products or services. This calculation can be used to identify customers who are loyal to a company and those who are not, as well as to measure the success of marketing campaigns. 
  
  Tips & Tricks: 
  When calculating share of wallet, it is important to consider the total amount spent on similar products or services, not just the amount spent with a particular company. This will give a more accurate picture of customer loyalty and the effectiveness of marketing campaigns. 
  
  Related Information: 
  Share of wallet is related to other CRM analytics such as customer lifetime value (CLV) and customer segmentation. CLV measures the total value of a customer over their lifetime, while customer segmentation divides customers into groups based on their characteristics and behaviors. Both can be used in conjunction with share of wallet to gain a better understanding of customer loyalty and marketing effectiveness.