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Why Market Share is Essential on Amazon

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Scott Needham

Amazon is a marketplace where the biggest brands keep getting bigger — and the data proves it.

Here’s what Harvard Business Review had to say about market dominance:

"As market share increases, a business is likely to have a higher profit margin and a decline in marketing costs as a percentage of sales."

Let me simplify that for you:

Market leaders make more money per sale.

They spend less on advertising but still dominate.

They’re nearly impossible to catch once they’re ahead.

Why? Because of scale, brand position, and all the other reasons. Let’s break this down with a real-world Amazon example.

Quest Nutrition: Spending Less on Ads While Dominating Sales


Take Quest Nutrition, for example. They are absolutely crushing the competition in the protein bar category.

SmartScout Data about competition in the protein bar category


Do I understand why? Not really (I personally can’t eat them). But that’s beside the point.

The real story is that Quest spends LESS on advertising than its competitors while maintaining a dominant market position.

That shouldn’t be possible, right? But it is—because market leaders get stronger over time.

This got me thinking: What’s the value of knowing Ad Spend Share in a category?

Why Ad Spend Share Matters on Amazon


At SmartScout, we built an Ad Spend Share metric to help sellers see how much top brands invest in ads relative to their market share.

Here’s why this data is a game-changer:

1. Market Share is the Scoreboard


📊 It tells you if you're winning or losing.

📊 It shows whether you’re catching up or falling behind.

📊 It helps non-Amazon people (executives, investors) understand your brand’s position.

Think of it this way: If Amazon is a game, Market Share is the scoreboard.

2. Ad Spend is a Leading Indicator


💰 What you spend on ads today = future customers.

💰 Especially in repeat-purchase categories like supplements, snacks, and beauty.

💰 Ad Spend Share can predict who will be the dominant player in the months ahead.

If Quest Nutrition keeps spending efficiently, they’ll continue to widen the gap from competitors.

3. Ad Spend Share Inspires Action


🔹 A smart Amazon seller never expects to stop advertising.

🔹 The goal isn’t just to spend—it’s to maximize ROAS and keep scaling.

🔹 Whoever can spend the most profitably will win in the end.

Or as Abraham Lincoln probably said: "Whoever can spend the most in marketing will win in the end." (Okay, maybe not Abe, but the principle is true.)

If you want to move up the ranks and dethrone the market leader, you need to know:

How much your competition is spending on ads

How that compares to their market share

How to adjust your own strategy to compete

Final Thoughts: Can Anyone Dethrone Quest?


📌 Amazon favors the big players—but smart sellers can still break through.

📌 Market leaders spend less on ads while maintaining dominance.

📌 Understanding Ad Spend Share helps brands scale strategically.

So, is anyone going to dethrone Quest in the protein bar category?

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