Is it that magical time of year again? You know, the time when organizations across the globe meet up to go over their strategic planning?
They may review their previous objectives, see how accurate they were, and plan for the future, among other things. What’s at the core of their plan? Strategy. Strategic planning is essential for any company to set goals and a path for the coming years. So how does one do strategic planning, exactly? It starts with benchmarking.
Does your organization include benchmarking in strategic management? If not, you’re definitely losing out. Read on to learn more about strategic benchmarking and examples of what it can do for you.
What is strategic benchmarking?
Strategic benchmarking means comparing your strategy to other successful companies’ strategies to determine the differences and identify opportunities. Knowing what high-performing companies do can help you optimize your business strategy and identify areas where you can excel.
While there are many types of benchmarking, strategic benchmarking is one of the most important for developing a high-level understanding of the path to success. How can you start benchmarking strategies? Here are a few strategic benchmarking examples.
Strategic benchmarking examples
SWOT is a great formula to start benchmarking in business strategy. Short for Strengths, Weaknesses, Opportunities, and Threats, SWOT will give you an understanding of your own organization in comparison to the market. Seeing your strengths and weaknesses next to threats and opportunities helps you evaluate what you should be focusing on.
Let’s say, for example, one of your organization’s strengths is its website’s stickiness. When visitors land on your website, they’re glued to the screen, scroll all the way down to the bottom, and often visit multiple pages. Now, let’s say you see an opportunity in the market to work with influencers who could promote your brand on their social media channels or websites. This could be a great opportunity for you to bring more qualified visitors to your already sticky website. SWOT is an excellent method to benchmark your unique selling points against what’s going on in the industry.
Strategic benchmarking is all about knowing what your competitors are doing. To understand their strategies, you need to do a full competitive analysis. This includes determining which companies are your competitors, and which have strategies you want to dissect. Once you determine which have successful strategies, dig deep to map out their activities and focus.
This could include putting yourself through their lead funnel to see how they interact with customers at different stages. Understand their key messages, the pain points they focus on, and how they highlight their unique selling points.
Also, read customer reviews to see how customers respond to their sales funnel and what they think of the customer experience. This will give you deep insight into their lead generation and customer acquisition strategies so that you can benchmark their strategies against your own.
You can do this competitor research for many different types of strategies. For example, let’s say you want to overhaul your business’ content strategy. You would do a full competitive content analysis to determine your competitors’ content strategies for SEO, blogs, and social media. You can use this analysis as a benchmark to build your own content strategy.
Remember when we said that strategic benchmarking is all about comparison? A visual comparison can be especially useful for understanding your position in the market. Market mapping gives you a complete picture of the competitive landscape, including customer segments, product comparison, and market forecasting.
It helps you understand supply, demand, saturation, and of course, location. Just like in old-fashioned cartography, market mapping requires you to define your borders and all the major characteristics of the market. Based on the parameters you identify, you’ll be able to pinpoint competitors on the map. You might pinpoint companies, products, or different audiences to see where you stand in relation.
For example, let’s say you want to create a strategic benchmark for a new product your company is launching. You would find out the competing products and determine their positioning in terms of quality, features, and price. After placing these products on your map, you can figure out where your product will fit.
Similar to the previous types of strategic benchmarking we discussed, trendspotting is about understanding the market and how you fit in. Trendspotting differs in that it’s all about finding out what’s happening now. In all the previous methods we discussed, you might be analyzing longstanding pillars in the industry; such as accepted practices and established companies. This is great for developing a low-risk strategy. But if you want the big rewards of being a market leader, strategic benchmarking must include trendspotting.
Look to online content streaming for a good example of trendspotting. Netflix set the trend for online streaming, and companies like Amazon, Hulu, and Disney quickly followed suit. Blockbuster, on the other hand, didn’t react to the trend fast enough, and we all know what happened there.
How can I improve my strategic benchmarks?
There are many ways to improve your benchmarking activities and Similarweb can help. We have several useful benchmarking tools that will ensure your strategic benchmarking process is thorough and beneficial:
- Market Intelligence: Explore your market, discover industry trends, analyze competitive performance, and understand audience behavior.
- Company Research: Understand how competitor websites and apps are performing to reveal any company’s digital footprint and growth into new markets.
- Market Research: Gain the full picture of your industry – analyze consumer trends within your market, become an industry insider, and grow your digital market share.
- Audience Insights: Analyze consumer behavior, better engage your existing audience, and explore new digital strategies for growth.
- Conversion Funnel Analysis: Understand the complete customer journey – uncover competitor strategies and performance metrics down to the purchase level to better define your digital strategy and unlock your full potential.
Strategic benchmarking in action
We can’t stress enough the importance of benchmarking in strategic management. Your organization sets goals, analyzes progress, and stays at the top of your industry. If you’re ready to get started, read our article about benchmarking best practices – your strategic management team will thank you.
What are the benefits of strategic benchmarking?
You’ll understand what your competitors are doing, compare your progress to theirs, and get inspired to try new activities and practices to boost your organization’s performance.
What are the challenges of strategic benchmarking?
It can be a challenge to analyze your competitors’ strategies, especially because most companies don’t make their strategies public. However, you can get a great idea about a company’s strategy by going through its sales funnel.
How do you use benchmarking as a strategic management tool?
Strategic management is all about building the framework for a company’s activities. To ensure the framework is realistic and to improve its possibility for success, you need benchmarking.
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