Defining The Credit Card Industry's Terms

I find it personally shocking that I would defend corporate doublespeak, but I am afraid you erred when you stated that credit-card issuers use the terms "market share" and "share of wallet" interchangeably ("A learner's guide to Corpo-Babble," Up Front, Mar. 7).

To financial-service providers, market share is the number of units you have as a percentage of all those in the marketplace. A simplistic example would be that if there are 100 credit-card holders in the market and 25 carry yours, your market share is 25%.

However, if the total annual charges those 100 cardholders rack up are, say, $50,000 ($500 apiece on average), but your customers only spend a total of $2,500 ($100 on each card), then your overall share of wallet is only 5% (or $2,500 into $50,000). It tells you that your customers aren't spending as much as those of other companies and you should focus on usage stimulation, etc.

Both are very useful measures and definitely different.

Stephanie J. Fierman

Vice-President for Marketing

Chemical Bank

New York

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