June 8, 2011

Penetration

Penetration - Penetration is a panel data measure.  It is the % of households that have purchased a product, or shopped in a certain channel or retailer.   Higher is better and 100% penetration is as good as it gets.  In Nielsen the fact is calledItem Penetration (for specific categories/brand/products) or Shopper Penetration (for channels/retailers).  In IRI the fact is % Households Buying.
If annual penetration of Brand X in the New York market is 56%, it means that 56% of all households in the New York market purchased Brand X at least once during the year.
Sales = (Total # of Households x Penetration) x Buying Rate




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