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Marketing benchmarking is the process by which companies set standards for their marketing departments to achieve in marketing their products and interacting with customers. The standards being set are known as benchmarks, and they reflect the ideal level of performance for each marketing practice. A company using marketing benchmarking is often one that is relatively new and needs a set of best practices on which they can base their own marketing efforts. Benchmarks can be derived from existing companies or competitors in the market, or they can be based on past efforts that have delivered optimum performance within the company doing the benchmarking.
Judging the performance of any single aspect of a company’s operations can be a difficult task. Especially when the company is relatively new and has little past history as a basis for comparison, it is necessary to establish some sort of standard against which all efforts can be judged is needed. Since marketing is such an important aspect of any business, finding standards for that department is crucial. That is why so many businesses practice marketing benchmarking.
When considering marketing benchmarking, it is important first to understand just what a benchmark actually is. A benchmark is some standard of performance that a company wishes to reach. Once the benchmark is established, the company in question can then find out how far away they are from reaching that standard. They can then devise the methods that will be needed for them to reach the benchmark that has been set.
In terms of marketing benchmarking, there are many areas where a company may want to establish benchmarks as goals. For advertising efforts, a benchmark may be set that establishes the ideal amount of consumers reached or the desired sales created. Customer service benchmarks may be determined through surveys and focus groups. Brand awareness may be measured as well to see if a company is making an impact in the minds of consumers.
Determining where to find these benchmarks is an important part of the marketing benchmarking process. In many cases, a company can look to the efforts of the power players within their industry as a model for performance. The risk in doing this is that the company may end up copying a proven formula without coming up with any innovation. For companies with a little bit of track record, they can look to their own past marketing efforts for best practices in the hopes that those techniques may pay off once again.