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What is penetration rate and penetration index? - 360 Marketing

Penetration Rate

Hovering over the “?(1) icon next to the word “Rate” in the upper-right details table header under “Market Penetration” will display the definition based on the demographic/firmographic elements that make up your list.


An example of such a definition could be something like “a percent representing the overlap in records  between Boat Owners and Benchmark for a given income value.”

The "Rate" is a percent representing the overlap in records between user’s list and the Benchmark list for a given demographic/firmographic value. 

It represents the count of each demographic/firmographic value covered in the user’s list compared to the count of the same value in the Benchmark file expressed as a percentage. It is calculated by taking the number of records of a specific demographic/firmographic value in the user’s list divided by the number of records of the same demographic/firmographic value in the Benchmark File multiplied by 100.

Clicking on the “Learn More(2) link below that definition will show you a more detailed explanation and how the Rate is calculated for each value.

Penetration Index

Hovering over the “?(1) icon next to the word “Index” in the details table header under “Market Penetration” will display the definition and clicking on the “Learn More(2) link will show you specific index definitions and how the Index is calculated for each demographic / firmographic value.

The Penetration Index compares your current market share (% of customers) to your potential market share (% of all businesses / households within the segment and your geographic footprint), and is referred to as the “Benchmark" (underlying population). 

Keep in mind that the penetration index only looks at the number of customers vs the benchmark and does not take any additional attributes into account. (revenue, number of orders, average order size, etc.) Penetration Index is one of many variables you should take into consideration.

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