Competitive benchmark studies can be used for a variety of strategic reasons. Traditionally they are most closely associated with comparing pricing, rating quality satisfaction and evaluating the speeds & feeds of competitive products. One form of benchmarking that is grossly under utilized is the marketing performance benchmark. It focuses on measuring a company’s online and offline marketing effectiveness and operational performance level compared to its competitors. This type of study allows you to:
Evaluate the maturity level of go-to-market strategies
Determine usage rates of “best in class” marketing best practices
Measure a company’s overall operational effectiveness
While many departments may shy away from doing such an evaluation, because in essence it gives them a report card, the insight that is gained is invaluable. It is a marketing metrics tool that can give you the strategic intelligence you need to get a jump on your competition.
1. Open up the Kimono: Performance benchmarks require you to “open up the kimono” and do an operational self-evaluation against your competition. If conducted in the right way they can deliver a tremendous amount of process improvement information, strategic insight and tangible business value. Benchmarks should become a fundamental element of your metrics plan and conducted at least once a year.
2. Know The Competitive Landscape: Not to be confused with brand awareness studies, value proposition conjoint analysis and other types of market research, a performance benchmark is used to better understand your competitors’ strategies, tactics and quality of execution – and how you compare to their use of best practices. The insight you gain can give you guidance on how to:
Be Different: Do things better/differently than your competitors when you are head-to-head in the same communications channel
Dominate White Space: Identify options available to select a different communications channel or tactic to use that can allow you to dominate unused white space without being in direct competition
Outperform: Develop ways to outmaneuver and pursue unique go-to-market strategies. Data collected overtime can also allow you to monitor your progress and determine if you are catching-up, maintaining or surpassing your competition
3. View It as a Chess Game: Having a good understanding of the competitive landscape can allow you to pursue unique and creative ways to out-flank others in your industry. Think of it as a chess game and if you play it the right way it will allow you to stand out, dominate and ultimately win. Even in cases where you can not match them dollar for dollar in the size of their budget. Making the right moves, at the right time and with the right creativity/innovation will always out-trump size. Just ask Apple a few years back right before they hit the iPod gravy train.
4. Develop a Framework: You should first develop a framework to determine the type of performance data you need (both quantitative and qualitative) that will allow you make strategic decisions based on the outcome of your analysis. The most effective and actionable comparison points you should use are key performance indicators (KPIs) and industry recognized marketing best practices. Once your comparison points are defined you need to prioritize, organize them by functional/operational areas and then weight the importance of each. Your framework not only gives you a methodology to follow in order to collect the right competitive intelligence, but it also gives you a consistent process to use in making your concluding performance evaluations.
5. Tap into Six Sources: There are many ways to gain the competitive intelligence you need for your benchmark. In fact, in the last few years there has been a dozen or more new online tools/sites introduced that will provide you with free information. Here are six sources and ways to collect data that you should consider:
Website(s): Sites can provide a wealth of information regarding their strategies, tactics and how progressive they are in terms of using Web 2.0 technologies and their use of the latest marketing best practices. Do they conduct Webcasts, post Podcasts, use a blog, have a user community, promote their social media sites, etc.
Web 2.0 Tools: There are a variety of free tools like compete.com, technorati.com, trackur.com and others that allow you to track online conversations, evaluate unique Website visitor traffic and monitor what is taking place in social media. There are also new sites that provide community-based research and offer free crowd-verified performance benchmarks.
Social Media and Blogosphere: Take a look at the discussion strings that relate to your industry, participate in the dialog and ask questions. You may be surprised by the competitive information you can pick up in these channels.
Interviews: New employees to your company that have been hired from a competitor are always a good source of information. Take time to meet with them and interview them on their experience.
Associations/Analyst Libraries: While most of these resources will require you to pay a membership fee or pay for services, searching their libraries for applicable studies may provide you with useful comparison data. You should check free online sources first before taking this step and deciding to pay for a report.
Conferences/Events: While a little “old world”, conferences and events still are a good venue to collect information, network and ask questions about your competitors.
Get a jump on your competition. Performance benchmarks should be conducted yearly and incorporated into your strategic planning process and used as an element of your marketing metrics plan. Develop a framework first so you know what you need to evaluate. The valuable insight you gain can help you modify your go-to-market strategies, adopt new “best in class” marketing best practices and take a new tact that can help you leap frog your competition. It is all about being smarter and gaining a competitive edge. Knowing how you stack-up against your competitors can give you a strategic advantage.