Expanding Share of Wallet with Card-Linked Offers

Consumer choice is a challenge for retailers. A plethora of choices, online and off, makes the competition for wallet share fierce. But what exactly is share of wallet, and what factors actually impact customer spending? How can brands accurately track it? And, what are the key factors impacting SOW in 2020?

What Is Share of Wallet?

Share of wallet (SOW) is the concept of how companies compete for the limited budgets of consumers within a category. The metric is calculated by determining the amount of money a consumer regularly spends at a brand’s location vs a competitor in the same category. For example, if a customer spends $200 of their $500 per month grocery budget at Safeway, Safeway has a 40% share of wallet for that particular customer.

Because it deals in the fluctuations of consumer budgets, share of wallet is most often referenced in areas where consumer spending is regular and repeated. CPG and QSR brands, for example, are highly focused on share of wallet metrics and strategies.


Share of Wallet vs. Market Share

Share of wallet differs from market share in that the former captures a given customer’s spend with a brand within a particular category of goods, while the latter is the share of overall revenue that the company enjoys in the industry segment as a whole. Because of the macroeconomic implications, it is often much more difficult to shift market share than share of wallet; brands looking to garner increased market share in a given segment must undertake broad and sustained efforts in order to shift market share by even a fraction of a percent.

Wallet share, on the other hand, is largely contextual; brands focused on the share of wallet concept acknowledge that they do not exist in a vacuum, but rather in intimate competition with their competitors at a store by store and region by region level. Walmart, for example, leverages its gigantic footprint and operational efficiencies to secure a monstrous 17% market share in the grocery segment, but when it comes to wallet share in a given category (clothing for example), even Walmart is subject to the same competitive forces as any other retailer.

See How Empyr Can Help

Key Factors Impacting Share of Wallet

What are these factors? To truly understand wallet share, we must first understand the factors that work together to determine its outcome.

In-Store Experience

Presentation, selection and convenience (one-stop shopping) all play a key role in the in-store experience. Since multiple companies compete across sectors for wallet share, expanding in-store selection is a great strategy for moving the needle in wallet-share, particularly if that segment is under-served in a particular region (think Target strategically moving into grocery).

Online Convenience

In-store pickup and delivery, especially curb-side pickup in grocery and CPG, has ignited additional sales for key players in those segments and has the potential to be a $35 billion channel by the year 2020. Kroger, Target, Walmart, and Whole Foods are all jockeying for position in this channel.


Keeping your rewards or cards “top-of-wallet” for customers requires regular, well-targeted and segmented offers to drive revenue. One of the most innovative ways brands are driving top of wallet-focused promotions is through card-linked offers.

Ease of Payment/Redemptions

Coupons are a huge industry, and those brands that make it easy for customers to access and redeem those coupons while closing the attribution gap — i.e. knowing which coupons are driving sales and for whom — are going to be the most successful in tapping into this $1B channel in 2020.

Loyalty Programs

Loyalty programs are incredibly valuable for maintaining revenue and decreasing consumer acquisition costs, and there is a demonstrable correlation between loyalty programs and increased lifetime value through repeat business.

Related: Why Every Retail CMO Needs a Card-Linked Strategy

How Is Wallet Share Measured?

Capturing share of wallet, however, does not begin and end at these factors. Often, companies make the mistake of measuring these factors against their own internal performance standards, rather than in comparison to its competitors, but standalone in-store merchandising or loyalty strategies will not be sufficient without also understanding how each of these factors ranks against direct competition.

This important distinction is best explained by HBR’s “wallet allocation” concept. The “Wallet Allocation Rule” accurately grasps the fact that store performance metrics do not, and should not, exist in a vacuum, but rather in close relationship to other competitors in the same geo and market segment. The rule takes into account the aforementioned metrics like in-store presentation and loyalty, but also the rank of those metrics by its customers compared to their closest competitors.

This distinction is huge for understanding share of wallet and for driving revenue at a store-by-store level. The HBR study makes some interesting discoveries, including the “correlation between changes in satisfaction or intention to recommend and in share of wallet was very weak,” meaning that while loyalty programs and in-store satisfaction may have an indirect impact, they don’t independently influence wallet share in any significant way without also increasing rank against the competition. Walmart’s failed 2009 “Project Impact” was a direct result of misinterpreting wallet share for in-store presentation survey metrics.

Share of Wallet Strategies

So how can brands accurately strategize for competition at the store level? Through Empyr’s partnerships, brands can leverage transactional reporting data to gain visibility into large shifts in spending in a given space, to understand how much spend it actually takes to move market share in a given industry, and to identify which competitors might be ripe for share of wallet competition in a given market segment and/or geo. This transactional data can also provide an intimate understanding of which promotions are performing the best through its card-linked offers platform.


Understanding and capturing share of wallet can be complex, as there are a variety of factors that directly and indirectly impact it. The most forward-thinking brands still monitor and push for results in all the traditional areas: in-store experience, online convenience, loyalty programs, promotions, and ease of redemption, but also seek to understand these factors in the right context, is, in comparison with the direct competitors in a given segment. The most dynamic of those utilize advanced software and transactional reporting data to gain both wallet share and market share.

Interested in obtaining a share of wallet report or increasing share of wallet for your category?

See How Empyr Can Help

*applicable brands only

New call-to-action