Digital Marketing May 20, 2020
The Why and How of Competitive Benchmarking
You have a great offering, you’ve done your research, and you know who your competitors are and what they are doing. You can easily identify where their products differ from yours, how yours are better, and who your audience is. But is it enough?
The crucial next step to success is an ongoing process of competitive benchmarking – that is, the process of measuring and tracking the strategies and outcomes of other companies in order to help you keep up with the competition and reach your KPIs.
Why Conduct Competitive Benchmarking?
You are well aware of your own performance metrics: Google Analytics provides you with complete visibility into your site’s performance, sales metrics help gauge revenue and growth, and financial reports give a measure of financial outcomes. But your own metrics are not enough. If your traffic is growing at a rate of 10% each year, but your competitors are each growing at 2X that – is your growth enough? If you’ve decided to focus on Product A this quarter, and your competitor is selling a comparable version of Product A at 5X your volume, are you satisfied?
Competitive benchmarking is a tool that effective businesses use to pinpoint where they stand across a variety of metrics. It can also be used to measure your performance in relation to any KPI, and with regards to taking stock of your outcome compared to any other site.
The Competitive Benchmarking Process
1. Choosing your KPI
The first step to a successful benchmarking effort is to identify the KPI you are measuring: Do you want to improve your SEO performance? Grow in a new market? Increase traffic to your site?
Identify your KPI first, so you know what to measure. These goals should be 1) realistic and 2) measurable! What good is it if you have a goal, but are unsure of how to measure it?
Here are some KPI ideas:
- Increase web traffic by __%
- Engage users – improve visit duration by __%
- Reach top 2 results on ranking on (define keywords)
- Improve share of voice in ___ topic from __% to __%.
- Increase brand awareness – improve branded traffic share by __%
2. Identify the Right Competitors
The competitive selection process is crucial for effective benchmarking and relies heavily on the KPI you’ve chosen in Step 1. There are a few types of benchmarks you can use here, but ultimately, the opportunities are limitless.
Here’s a short sample list, but keep in mind that any benchmark can be done against a wide variety of companies:
- Immediate competitors: When looking to see how you can improve your share of voice or performance on specific topics, it’s best to choose those competitors that are very near to you. These will compose your immediate competitive set, and you’ll want to continually monitor their overall performance to make sure you’re on the right track and, if needed, adjust your course of action accordingly.
- Best in Class: Though we dream big, it’s more likely that you are not the biggest and best site in your category; however, you probably really want to be. When looking to improve your long-term growth goals, aim high, and compare yourself to the sites that win your industry.
- Disruptors: It’s easy to look up for inspiration, but sometimes, you also need to look below. Companies that are much smaller than yours might be growing faster than the industry, which could pose a threat in the near (or far) future. Keep an eye on their performance to see what innovative methods they are using for growth, and how you can continue to stay ahead of them.
Having established your goals and which types of companies you should be comparing to, how do you identify which specific companies fit into your benchmark? You should be aware of your immediate competitive set and biggest players in your industry, but how can you identify who’s getting the most SEO traffic, and who is growing the most? If these are your goals, there are a few tools that can provide visibility into one metric over another. Using SimilarWeb, you can gain insight into a wide range of these metrics, and easily find the right companies to benchmark against.
3. What to Measure – And How
You know your KPI, and you have identified the sites, so now it’s time to measure. The metric you measure, and tools that you use to do so, will vary based on your goals. For example: aiming to improve SEO relies on seeing the competitive traffic on keywords and keyword groups; increasing brand awareness requires visibility into the direct traffic into a site; and expanding share of voice may rely on traffic share across specific pages of a site.
Remember to keep it simple! You want metrics that you can return to over time and see a clear picture. Aim to keep the number of metrics as few as possible for each KPI.
Here are a few tools to use for each type of KPI:
- Achieving Growth: Track site traffic, using a tool like SimilarWeb.
- Improving SEO Rank: Use one of the widely available SEO tools, including SimilarWeb’s marketing offering to identify whether or not your competitors are increasing SEO traffic, and which keywords they are using. Track their landing pages to see how they are achieving this.
- Increase Social Following: Monitor competitor’s social pages, including the number of likes and followers. Tools that are excellent at this include , , and .
- Expand Product Offering: Follow competitors in the news and see what they’re doing. An easy way to do this is by setting an alert for their name on . This will notify you any time a company is mentioned across the web. You can also use or and also keep an eye on company press releases and websites.
- Improve Profitability: This is admittedly easier in a public company, where you can view quarterly financial reports. You can also use sites like to see if your competitors have raised money, and how much.
Of course, there are other options like paying for a report from companies like Nielsen, or running your own survey, though these are highly expensive and/or complex.
4. Now What? Track!
Once you have decided on your KPI, identified your target competitive set, and defined which metrics you will need to track to achieve your goal, it’s time for tracking! Remember to keep separate benchmarking reports for each goal and type of competitor ( gauging against much smaller, and/or much larger companies on the same report can lead to confusion), and return to these measurements whenever you conduct your planning, which should be at least every quarter. Periodically reassess if these metrics are still relevant, important, and are helping you achieve your goals, and be sure to keep a finger on the pulse by investigating if there are any additional goals you would like to add to your stack in using benchmarks.
The process of competitive benchmarking is a necessary part of any business plan, and should be conducted regularly to make sure that your business goals make sense and that you are staying on top of them. The process helps businesses view their performance in perspective, and helps avoid blind spots. The type of benchmarking you will conduct largely depends on your goals and KPIs, and any measurement should be in line with that.
SimilarWeb offers robust tools that can help in any type of competitive benchmarking, including web traffic estimations, site segmentation reports, engagement metrics, and user acquisition strategies.