Answer this question honestly: Do you know how well you are performing against your main competitors? Gaining this type of insight is fundamental for your business to thrive—particularly if you are a PR or marketing agency with a big focus on customer relationships and brand reputation.
With so many players on the scene, your current and potential customers are quite literally spoilt for choice. So, how do you find out how you’re comparing to your biggest rivals? By conducting a competitive benchmarking analysis.
If you’re curious to learn more about this, keep reading. You’ll discover how to implement such a process and ensure your target audience always chooses you.
Competitive benchmarking: Definition and benefits
First, let’s define “competitive benchmarking”. This simply refers to the practice of comparing your performance with that of your competitors to work out how you’re faring against them.
Running a thorough, relevant, and laser-focused competitive benchmarking analysis can help you reap lots of benefits. Below we have listed a few.
It enables you to keep tabs on your competitors
Well, this is probably a given, but it’s nonetheless an important advantage that’s worth mentioning. With a well-thought-out competitive benchmarking analysis, you can track your rivals to find out whether they have achieved anything particularly important recently, or if they are responding to specific industry trends in a successful (read: profitable) way.
For example, let’s imagine that both you and your main competitor have a strong presence on Facebook. However, since they started taking a generational marketing approach to their social media strategy and incorporated user-generated content and social proof, their sales have soared. This could be a powerful indicator that you, too, might need to rethink parts of your own social media marketing strategy.
It provides you with an accurate overview of your business
Sure, competitive benchmarking is all about looking at your competitors – or is it? Not quite. A really solid strategy will also uncover crucial information about your own company. This includes any gaps in your offering, ineffective digital marketing strategies, unsatisfactory conversion rates, and more.
Using social media for growth, as we saw in our previous example, might be a powerful tool that you’re not taking full advantage of yet.
Similarly, you might realize that your company is not producing enough relevant content for your target audience or that implementing hyperlocal strategies might be what turns potential customers in a specific geographic location into happy (and returning) buyers, forging a deeper connection with your customer base.
It helps you build a more powerful strategy for your business
By looking at what your competitors are achieving from a strategic point of view, you’ll be able to reveal whether your current strategy is lacking anything specific. This, in turn, will allow you to take better, organic approaches that enable you to overtake your savvier rivals.
This could mean implementing location-based targeting as part of your social media marketing strategy, adding email marketing to your digital strategy to enhance how you connect with your audience, or rethinking your brick-and-mortar store’s layout to increase foot traffic. Either way, competitive benchmarking analysis can equip you with the data you need to make the right choices.
It may benefit your company culture (and your employee retention rates)
Have you discovered that some of your main rivals are offering their employees some pretty amazing benefits, training, or development opportunities, which allow them to retain the best talent across the industry? Well, you might need to follow suit if you want to keep attracting your target audience and employ the best people for the job.
It could help you boost your revenues
When done well, a competitive benchmarking analysis has the potential to help lift your revenues. How? It’s simple. Just compare your company’s sales reports with those of some of your biggest competitors, and you will almost certainly be able to spot golden opportunities to open up new revenue streams, widen your target audience, or even expand into new markets.
Maybe there’s an opportunity to expand your retail portfolio to manage PR for dropshipping clients. Or perhaps you can use your expertise in social medi straetgy to support a new wave of clients in the sustainability sector.
Competitive benchmarking: Four best practices
Now that you know what competitive benchmarking is and what you can gain through a well-thought-out strategy, let’s look at some best practices to put it in place.
1. Choose your benchmarking framework
Not all competitive benchmarking analyses were created equal. Depending on your goals and needs, you’ll first want to select the framework that best suits your company.
Here are the three most popular ones:
- Customer journey map: This process involves analyzing your customer journey across all the touch points. These can include your email campaigns, online ads, website, and social media platforms (to this effect, it might be very useful to leverage social listening). Once you have completed this analysis for your brand, do the same with your competitors, and you will be able to see how you perform against them.
- Growth share matrix: This framework includes four parts – Stars (products/services with high market share and growth), Question marks (products/services with low market share but high growth), Cash cows (products/services with high market share but low growth), and Pets (products/services with both low share and growth). Simply allocate your products/services to each of these categories to work out which ones are worth investing in.
Image sourced from neostrom.in
- SWOT analysis: SWOT is an acronym that stands for Strengths, Weaknesses, Opportunities, and Threats. Strengths and Weaknesses include internal factors, while Opportunities and Threats are all about external things, such as your customers, market fluctuations, and your competitors. By working out SWOT rates for both your company and your rivals, you can shine a light on opportunities for growth and improvement.
2. Select the most relevant metrics to track
With your chosen framework ready to go, it’s now time to select the metrics that you’re going to track during your competitive benchmarking analysis. These are entirely up to you, but below, you’ll find some inspiration:
- Traffic: Check out how your website is performing by looking at the geography, demographics, and other characteristics of your visitors. Then, have a look at how your main competitors are performing, and whether you should adjust anything in your digital marketing strategy to improve some of those areas.
- Brand awareness: When a new customer needs the product or service that you provide, do they automatically think about you, or do they go straight to your competitor? Brand awareness is a crucial metric to track, so we recommend using a specific tool such as ChatGPT or another LLMOps (read this if you’re wondering: “what is LLMOps?”) to verify your online presence and compare it to that of your rivals.
- Customer sentiment: Do you know how customers (and online users in general) perceive your brand compared to your rivals? This is another vital metric to add to your analysis, as it will enable you to assess your customers’ sentiments towards your company—and take action if necessary.
- Social media metrics: If you are active on a range of social media platforms, you’ll definitely want to include metrics such as reach, engagement, and unique impressions. These indicate how your social media campaigns are performing against your competitors, and whether you might need to tweak some of them – maybe by including something like a hyperlocal social media marketing campaign.
Image sourced from chatgpt.com
3. Use the right tools
A lot of the work involved with competitive benchmarking simply can’t be manual. Not only would it be incredibly time-consuming, but it would also potentially lend itself to the risk of human error. In turn, this would completely skew the findings of the analysis, and negatively impact any decision-making that follows.
Web scraping tools can automate the collection of valuable data from competitor websites, allowing you to rapidly gather and update information about their marketing strategies, pricing, and product offerings.
So, make sure you work with the best and most advanced digital tools that can support you with your competitive benchmarking analysis. These include popular ones such as BuzzSumo, Ahrefs, and SimilarWeb. Review each one and select the platform that most closely matches your needs and that includes the features that are most relevant to your brand.
Using the right tools is also essential when it comes to strengthening data security and data governance (read this if you’re wondering: “why is data governance important”?) so remember to select a solution that offers strong safety protocols.
4. Share your insights with the team
At this point, you’re done with your competitive benchmarking analysis. But don’t be fooled, because the real work is only just starting now. Yes, this is the time when you take stock of what the analysis has uncovered and share it with your team.
Let’s imagine, for example, that one of the initial findings from your competitive benchmarking analysis is about your social media platforms. Specifically, it shows that adopting hyperlocal marketing strategies on both Facebook and Instagram might stand you in good stead when it comes to overtaking your number one competitor.
Or maybe it highlighted that your competitors are increasingly using AI in marketing to create hyper-personalized campaigns and automatically generate content to save time. As a result, you’re planning to implement similar tactics with the best tools at your disposal.
This information is pure gold – but not if you keep it to yourself. Make sure that every relevant team member has access to it and that they have the right tools and resources to take action accordingly. The way you share this data is entirely up to you. You can do so through a collaboration platform, your company’s intranet, or IP telephone systems, depending on your preferences and those of your team.
Key takeaways
Conducting a competitive benchmarking analysis may be a fairly lengthy and complex process, but it’s also a truly invaluable one. As we have seen in this article, this type of analysis is crucial to help you determine how you perform against your main competitors, what your strengths and weaknesses are, and whether there are any untapped opportunities for your brand to look into.
Essentially, a competitive benchmarking strategy is not just a way to keep a close eye on your competitors. It’s also a powerful tool to create stronger connections with your prospective customers through hyperlocal campaigns, personalized content, and the delivery of a stellar customer experience.
So, what are you waiting for? Start tracking your competitors and check how your company performs against them!
