Market share myths: iPod vs Zune and Mac vs PC

Apple Store“Analysts and reporters like to talk about market share statistics, but the conclusions they draw are often misleading. Here’s a look at how those numbers are used to paint grossly inaccurate portrayals of the market share of the Zune among iPods, and alternatively the Mac among PCs,” Daniel Eran writes for RoughlyDrafted.

“Market share simply refers to the portion of a vendor’s unit sales compared to the overall market. However, most large markets include specialized niches that each act as a market. For example, within the overall market for vehicles are passenger cars, and buried within that major segment is the small but profitable luxury car market,” Eran writes.

Eran writes, “BMW doesn’t compete against ship and plane builders, nor even the entire line of cars built by GM. It would therefore be absurd to talk about BMW’s small share of the ‘vehicle market,’ or even to compare its market share among other car makers. It’s simply pointless and irrelevant.”

“Microsoft-enamored analysts have long been titillated to report Apple’s small Mac market share in comparison to all PCs sold worldwide,” Eran writes. “They are not as quick to mention that the definition of ‘the PC market’ ballooned as PCs makers pushed into markets unrelated to Apple’s business, resulting in a commensurate decrease of Apple’s share as the overall PC market rapidly expanded into unrelated directions.”

More about the iPod vs Zune, the difference between unit sales and market share, profitability, statistics, Microsoft CEO Steve Ballmer, pretty graphs, and more here.

[Thanks to MacDailyNews Readers “RadDoc,” “JadisOne,” and “Bill M.” for the heads up.]
As we’ve long said, actual market share numbers are limited by measurement methodologies. It’s a tricky business. Every measure of market share uses different samples and often excludes important sources (i.e. NPD’s market share percentages do not include Apple Retail Stores, Wal-Mart, Dell’s online sales, etc.). What really matters when looking at specific market share reports are the trends they show over time, if they use consistent methodologies. The trends are what’s valuable. All measures of Mac market share that we’ve seen show increases, regardless of the specific percentages at which they arrive; they all differ because they all measure differently. Mac unit sales continue to show year-over-year increases, as do iPod unit sales.

Related articles:
NPD: Apple #5 in notebooks, #1 in online songs unit share – March 13, 2007
Net Applications: Apple’s Mac market share continues rise, hits 6.38% in February 2007 – March 01, 2007
NPD: Mac sales grew 108% in January – March 01, 2007
Briefly: NPD data indicates Apple iPod units tracking above Street – February 28, 2007
Net Applications: Apple’s Mac market share continues rise, hits 6.22% in January 2007 – February 01, 2007
NPD: Apple iPod held 72% share of PMP market in December; Microsoft Zune had 2.8% share – January 21, 2007
Gartner: Apple’s U.S. Mac shipments up 30.6% year over year – January 18, 2007
Net Applications: Apple’s Mac market share continues rise, now at 5.39%, up 31% year-over-year – December 01, 2006
Apple’s Mac market share surges, up 35-percent year-over-year as growth accelerates – November 01, 2006
Analyst: Apple has ‘real shot at dramatically expanding Macintosh market share’ – October 31, 2006
Analyst: Apple Mac gains market share, the reason why is significant – October 26, 2006
IDC: Apple Mac attained 5.8% of U.S. market share in Q3 06 – October 18, 2006
Gartner: Apple Mac grabbed 6.1% of U.S. market share in Q3 06 – October 18, 2006
Gartner: Apple Mac grabbed 4.6% U.S. market share in Q2 06 – July 19, 2006
IDC: Apple Mac attained 4.8% U.S. market share in Q2 06 – July 19, 2006

65 Comments

  1. Yeah, I assume then that because BMW makes less than 5% of the cars on the road worldwide, they must be on the verge of going under at any moment. On the other hand, I see tons of Fords out there on the road everyday, so that obviously must mean that they are leading the entire industry. That’s the same kind of argument a M$ fanboy would make anyway. ” width=”19″ height=”19″ alt=”rolleyes” style=”border:0;” />

    Your Frustration. Our Fault.

  2. Welcome to Business 101. I am an optimist and think most people realize this and will say, “yeah, so what?”.

    But rather than stating the obvious, I think Eran should dig deeper into why people *don’t* question this crap when they hear it from the media. Anyone who is not a hermit knows that more than 3% of the computers in homes are Macs, but they hear a figure from “news” outlets and just think it’s true.

    Bottom line, people are just sheep (think Pink Floyd).

    Enjoy your weekend (I’m headed to Pebble Beach for golf )

  3. I expect another “Enron” coming from Microsoft. Falling sales, profits down, failed product launches. Give it some time. Ballmer is lose enough with numbers he will say the sky is blue all the while a hurricane is blowing everything away.

    MS stock holders should get out while they can.

  4. To BustingTheSkullsOfIdiots,

    Well, I don’t know about Eran, but you must have a pretty cracked skull from the “screen name” you used! LOL

    I say, “Figures don’t lie, but liers can figure!”

    I would be curious to see how the numbers stacked up if we compared computer sales of mid level and upper level computers (the kind Apple sells) to consumers (not business) and matched Apple sales to the other companies.

    First the loss leader computers would drop off the map. Now we would be looking at “The buying habits of those people with a knowledgable choice”. I think it would be a very interesting chart. LOL I can easily see Apple being either third or even second in sales in the USA. Wouldn”t that shock the pants of a lot of people. ” width=”19″ height=”19″ alt=”grin” style=”border:0;” />

    ne

  5. I’ve still never seen a Zune outside of the display at a store…

    The niche market place analogy is useful. I think it is contradictory for the author to then ridicule monkeyBallmer for wanting to compare Zune sales to only those at the same price point. Obviously, it is not descriptive of their position in the entire market, but it is legitimate to show how it is competing against similar devices. I would actually love to know their market share in this $249+ HD based player niche. I would be shocked if the monkeyBall’s numbers are correct. In fact, 10% would be surprising.

    On a related note, are the numbers on sales at the Zune marketplace? By sales, I do not mean “points used”, but rather songs sold.

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