What is Competitive Benchmarking?
Monitoring your company's progress is essential for expansion and informed decision-making. The purpose of competitive benchmarking is to compare a company's metrics to those of its rivals to identify opportunities for development.
Maintaining or gaining market share within a given sector is very difficult without continuously working to better your company.
All of these enhancements will help your business expand while also providing your customers with a better overall service.
The first step in making changes inside your organization is to get familiar with its flaws and to study the finest practices and methods used by your most formidable rivals.
To do this, you may use competitor benchmarking, which analyzes your competitors based on a variety of criteria (both internal and external to your own company).
- Competitive benchmarking is the practice of analyzing your brand's performance relative to that of similar businesses and the market as a whole using several different measures.
In a nutshell, it helps you evaluate how you compare against others in your field.
Competitive Benchmarking Metrics
There are many different measures that may be used for competitive benchmarking, and the indicators that are most important to you will change depending on your industry and company.
In general, however, you should make things as straightforward as possible so that they may be easily reviewed afterward.
Among other KPIs relevant to your sector and company objectives, you should prioritize the following:
- Ranking. Your SEO rating is a good indicator of how well or poorly you are doing in relation to the competition for certain keywords.
- Influence on Social Media. You can figure out how well your social media sites are doing and where you can make changes by analyzing your traffic, engagement metrics, follower counts, and other data connected to social media and comparing it to that of your competitors.
- Brand Awareness. Your brand's performance may be gauged in large part by looking at your site's direct traffic figures, while the proportion of your site's traffic is an indicator of its share of the market's voice.
- Product Market Acceptance. You may learn a lot about how to improve your product campaigns and offers by looking at how your products stack up against those of your competitors.
Benefits of competitive benchmarking
- Watch Who You're Up Against
For the time being, at least, you may have a leg up on the competition. Well, what if they begin to close the gap? If fresh players join the field, what happens then? Alternatively, what if a rival suddenly changes tactics?
Even if you don't intend to imitate their actions, it's smart to know what your rivals are up to.
- Keep up with the Latest Innovations
Using benchmarking data, you can determine where your brand stands in comparison to the competition and then work to strengthen that position. In recent years, this has taken on more significance due to the rapidity with which market circumstances may shift.
- Maximize Income and Sales
Your sales and income should increase as you find more ways to enhance the business. It's for this same reason that we should strive to better our situation. You should strive to improve upon what already exists in the market.
- Gain a Dispassionate Perspective on Your Company
The majority of marketers have a firm grasp on where their product stands in the industry. However, business owners and managers may be too close to the problem at times. It's preferable to use hard numbers to back up your intuition about where you are in the market. That is precisely what the goal of benchmarking is.
How to do Competitive Benchmarking
You should include competitive benchmarking in your strategic planning sessions, and review it outside of sessions to add new competitors to your list. If you take the time to properly set things up from the outset, you'll have no trouble keeping tabs on the competition's progress.
Follow these instructions to do a competitive benchmarking analysis:
- Explore market data to identify relevant rate metrics.
- Find out who your rivals are.
- Prepare a report detailing how you stack up against the competition.
- Carry out the research.
Competitive benchmarking gives you the information you need to compare your results to those of your rivals and learn where you can make improvements. Remember that comparing yourself to the competition is an ongoing process.