Is benchmarking relevant to your business marketing strategy?
Most businesses understand the power of marketing for increased sales, a broadened customer base, better brand recognition, customer loyalty, and more profit. Its power is only likely to rise as UK advert viewability increases, rising 19% from 2017 to 63.4% in 2018. But many businesses fail to see the real power of marketing in action. That’s because they don’t measure how effective it is through benchmarking.
How to benchmark your business
Understanding how your business compares to your competition can make a big difference to your business’s success. Successful benchmarking involves choosing metrics to measure against competing companies in your industry to see how you contrast. You should compare businesses of a similar size and similar objectives for a more accurate representation of where you stand.
Things you would consider include:
- Costs measured against industry norms
- Wastage levels
- Market share
- Gross profit margins compared to competitors
- Number of returning customers and the number of complaints
- Sales per employee
- Comparison of your strategic objectives to find lessons to be learnt
- Analysis of allocation of resources
The metrics you choose to measure should be directly related to the success of your business. Meaning any improvements you make in these areas will have a significant impact on your business’s profitability.
The benefits of benchmarking in marketing
Successful benchmarking allows for a clear understanding of where your business stands and how far you are from your goals. It also allows you to use other companies to improve your operations to become more profitable. It also allows you to foster business growth by comparing your strengths and weaknesses and highlighting significant areas for improvement.
Concerning your marketing, benchmarking has a number of benefits. If your findings show improvements in your business, this can act as evidence that your marketing strategy is paying off. If your benchmarking shows a decline in areas such as customer perception, it could mean that your strategy and the messages you are presenting need reworking to fit your customer base. Benchmarking is a useful tool in strategic marketing as well as marketing evaluation.
Do you need to benchmark your business?
Getting caught up in your business and giving it all your focus can be beneficial. You can start to make real progress toward your goals. However, when you built your business from nothing, you can become blind to what’s going on in the wider world. Benchmarking is a way to help open your eyes to new opportunities, new ideas, and new ways of working that will improve your business by helping you see the bigger picture.
Benchmarking doesn’t just help you understand how you are performing. It enables you to understand your potential, which is essential if you want to create a marketing strategy that will harness this potential. You need to be able to see where in your business operations this potential for improvement lies. As such, it is a vital part of marketing and business management that remains as relevant as ever. And luckily it is becoming much easier to do.
When benchmarking, there is usually no requirement to contact competitors directly. You can find much of the information you need online. Competitor analysis sites like SimilarWeb and Hitwise can be easily accessed and used for competitor analysis. MailChimp gives an overview of how your email performance compares to similar senders. Google Analytics offers various benchmarking tools, and don’t forget about the Google Trends tool.
But, like all things in marketing, if you want to make the most out of your benchmarking, you need to make sure the results of your analysis are founded on secure marketing knowledge and valid information. This is why many people choose to hire professional marketers to help with their marketing analysis and benchmarketing.
If you need a professional marketing company to steer your business in the right direction, get in touch with KUB today on 0345 053 7417 to see how our services will get you to the top.