It is nothing more than an expression derived from “benchmark” which in Portuguese means reference. In other words, analyzing companies in the same segment as yours that are references in the market and understanding which strategies are used.
Our role is to reduce bureaucracy and make this world accessible . In this article, you will learn what it is and how to apply it in your company to optimize your results.
What is Benchmarking?
In the world of Marketing, data is also very important. Learning how to analyze it effectively is extremely necessary for good positioning.
Rather than being a pointless exercise in data analysis , benchmarking can help you identify areas where you can improve and make your business more profitable.
Therefore, every company interested in improving its Marketing must carry out an in-depth analysis of the techniques that brought the best results for its competitors.
This fundamental practice not only allows you to study your competitors, but also to understand your own company's internal processes. All of this is always aimed at optimizing the results generated from the Marketing strategy.
By identifying which techniques are used in companies that have already built authority in the market, your company can not only reference itself, but also analyze its own performance in the market, focusing on its products, processes and services offered.
Although referencing can often sound like “copying” or “stealing ideas,” that’s not what we’re talking about. This practice is not wrong and adds value to both parties . After all, it gives every company the opportunity to stand out in the market.
How to take the first step towards Benchmarking?
To benchmark your business, start by deciding which areas you want to benchmark. Select those that are central to achieving your core business goals, such as finances, sales, or margins. For example, you might benchmark your business costs against industry norms.
Look at the mechanics of your business. How well are you using your technology, for example? Are other companies benefiting from new ways of doing things? Think about how other companies’ goals and processes can benefit your business.
Avoid overcomplicating your approach , stick to one or two key metrics to measure. The more focused your research, the more useful it will be.
To help you with this process, we have put together a list of some things that every company needs to be aware of before starting out:
Duty begins at home
Benchmarking is not just about studying the singapore business fax list competition. First of all, you need to study your own company and the marketing strategy that has been used up until now.
This way, you can identify the processes that already present good results and improve them, and most importantly: Analyze what your company may be doing wrong and find out how to improve.
At this stage, you will be able to see what type of professional you need to invest in to add value to your work team.
Other than that, defining which objectives you want to achieve and building an action plan is essential to achieving results with benchmarking.
Have a strategic plan
Thinking about an action plan that helps optimize results is one of the first things companies should think about.
In this document, the responsible team will list the goals to be achieved , which results are satisfactory, deadlines for the start or end of the project and the budget required for implementation.
Define your work team
Above all, it is essential that the team responsible for executing this strategy is aligned with your company's action plan.
It is not enough to simply analyze data in a generic way, it is necessary to have professionals with a good analytical profile to process and interpret this data correctly.
Customer feedback remains essential
It is very important to know if your company is projecting the image you would like. Therefore, relying on your customers' feedback can be a good way to define which aspects need to be improved and what has been pleasing.
Thinking about a channel for these questions to be answered increases credibility with the consumer and also helps in obtaining data.
Point out who your references are
Another fundamental point to start benchmarking is knowing how to identify which companies in your segment are seen as references in the market.
After all, no business exists alone. It’s important to know who your current and future competitors are and how they are operating in your market and in any market you want to expand into.
You need to decide which companies you will analyze. At a basic level, you can compare your data against published industry standards or data available from a consulting service such as Benchmark.
It’s worth comparing your operations to companies outside your industry that excel in the areas you want to measure. Analyzing your approach and adapting it can help you outperform your competitors .
You can also team up with other businesses so that you can benchmark on an ongoing basis. It is vital that you reach an agreement with a business (or businesses) of similar size and structure and one with similar goals.
It’s a good idea to draw up a benchmarking agreement with your partner. This should include the information you want to exchange and how it will be used. Never ask for information that you’re not prepared to share in return.
Keep the indicators in mind
Knowing which indicators to focus on when analyzing data is very important. Each company can choose which metrics are best to use when conducting research.
We have separated some indicators that can help you in this process:
• Costs: Utility bills, salaries, etc.
• Key performance indicators: Sales per employee, gross profit margins, etc. Some indicators may require analysis, such as customer satisfaction levels or the effectiveness of staff training.
• Processes: Inventory management, quality control or customer service.
• Strategy : You can learn strategic lessons from other organizations.
Don't forget that to think about indicators, you need to have already created a benchmarking action plan . After all, analyzing all the information that somehow sparks interest for your business will certainly bring results in a given area.
4 best benchmarking practices
The first step to effectively growing your business is to assess how your current sales and operational efficiencies compare to similar companies.
When setting your business goals for the year, wouldn’t it be valuable to know how many orders your competitors processed last year? Or how many different channels they’re selling on and what e-commerce solutions they’re using?
Benchmarking isn’t just good for assessing where your company is today. It can also help you identify where the best opportunities lie for market expansion and operational improvements.
To establish a competitive benchmark for your business, you must:
1. Determine key metrics
What are the most central data points for your business? Focusing on key business-driving metrics like revenue, order volume, and cost of goods sold makes competitor research and measuring success much clearer.
Benchmarking allows you to perform an in-depth analysis of your competitors. Knowing what price your competitor charges for the same service as you is important to understand whether your product's pricing is in line with the market.
2. Research and evaluate competitors
How are your competitors differentiating themselves in the market? What different sales channels and retail technologies are they using? These are the types of questions you need to answer and the competitor actions you need to anticipate.
Visiting a competitor's channels is essential in the Benchmarking process. This way, you can analyze the strategies, language and type of content that has been bringing results.
3. Take advantage of benchmarking tools
Aside from expensive market analyst reports, data that can provide competitive analysis on how you are performing against your competitors is scarce.
Fortunately, there are free tools available to make the research and discovery process easier.
You can count, for example, on a platform called Ubersuggest .
With it, you can analyze how other companies in the same segment as yours operate in the world of digital marketing. This helps in the process of understanding what has worked for other companies and how to use these same techniques to optimize your results.
This type of analysis provides necessary information about what your persona consumes on the internet and what are the main searches they carry out on competing companies.
This way, you can have a broader view of the results obtained and make the objectives of your action plan with benchmarking possible.
4. Develop a practical plan
What insights has your research uncovered for your business? Once you’re clear on what your competitors are doing and what changes you need to implement to drive business success, it’s time to determine your key goals for the year and start developing tactical plans to achieve those goals.
Be sure to track your progress weekly and monthly to confirm that you are hitting important milestones.
