How to use Benchmarking in e-commerce?

Ziel Lab
5 min readNov 4, 2020


Businesses are always striving for continuous growth and ways in which they can effectively make new processes to increase the selling of their products and services. But where does this end and how can a company determine whether it is actually successful?

Businesses always strive to reach at the top and in the process of this it strives to achieve benchmarks so that it can compare itself against a standard and develop a consistent way of measuring performance.

What is benchmarking?

In business, benchmarking helps to measure the performance and standards of your company’s products and services, and compare it against the set standards. These set standards help to define the aim the company wants to achieve and these standards are made through rigorous testing and through market leaders data estimates.

For example, suppose it takes 20 minutes for your company to produce a product. Is the 20-minute production measurement good or bad? The only way for you to know is to compare against other data, such as the time it takes the market leader to produce a similar product. If another

organizations can produce the same type of product in less than 20 minutes, you can use their time as a standard and try to improve on this with better production standards and aim at achieving this goal.

Benchmarking in e-commerce:

With the incremental growth in the e-commerce industry where new players are adding everyday and giants like Amazon and Alibaba are continuously evolving it becomes more important to specify what data is genuinely valuable for brands as they grow? Are there points where these industry benchmark data becomes more or less useful?

This is something that the brands struggle with a lot as they try to figure where they should fall compared to other businesses in the industry, and understand how they compare themselves so that they can act on these metrics. Dan Brazelton (co-founder of The Bitter Housewife) recommends taking external benchmarks with a grain of salt — So it becomes even more important in the e-commerce industry to understand how these data points are measurable and how to use them.

Is benchmarking even comparable in e-commerce?

The biggest problem with benchmarking is that it might be easy to measure two similar things that have existed for a long time and have seen not an incredible growth, but for an industry like e-commerce where looking at industry-wide (or even vertical-wide) benchmarks, is actually like comparing apples to bananas.

Brands are different personalities, after all. All collected averages combine a really broad variety of data, meaning that the numbers you’re working from don’t always represent the actual experiences of individual businesses. Other businesses’ benchmarks only tell you what is possible. But they don’t tell you if it’s a good idea, profitable, or applicable.

So is benchmarking ever actually useful for the business?

The thing about benchmarks is that they aren’t necessarily a great way to approach your business, but.

There are cases where benchmarks can be useful: when they’re either super broad or super specific. For the brands that are new in the market,

benchmarks can help understand how your business fits into the broader market.

They help new businesses to understand the market while they are running paid experiments to make sure they are directionally correct. But again, you cannot just rely on these as you have to remember that internal measurements will always give you a better understanding of growth.

Benchmarks don’t have to be data-driven either. There are other ways to analyze bigger trends. You can always use broader benchmarks to understand how your brand approaches your market in context of the other businesses that surround it.

Benchmarking for specifics:

Benchmarking can be better used and applied when you focus on smaller elements of your business instead of focusing on concepts like average CACs for the industry.

Example: Marketing can be a lot easier to benchmark as compared to retention, because the data is more readily available. Competitor insights on platforms like Moz and Ahrefs have readily available information about pageviews, backlinks, and keywords.Founder of Haus, Helena Price Hambrecht, has an interesting take.

So let’s say a brand X has an average item price i.e. Y, cart = Y*1.4, convert rate for them is at 0.8%, recurring customers convert at 4.8%. In this example, you’re still working with averages, but the data is specific to a single company, and you can break down the areas where you should be working to hit that benchmark and where your brand is different enough that the data really doesn’t apply.

What parts of your marketing can you benchmark?

Industry specialists recommend looking at aspects like email open rates (Klaviyo has a great guide) to help put your email into context. A tool like Klaviyo would help you understand how your business can leverage on the data you have and through predictive analysis help you analyse your customer’s lifetime value.

Benchmarking helps in understanding the direction of the whole industry, but goal-setting should be internal and personalized according to the customers. You should focus about benchmarks in terms of aspects of your brand and not your overall growth.

The final approach

At the end of the day its your consumers that matters the most and how would you make the experience stand out using that data, through what tools you achieve your goal. Are you targeting the right consumers and have you segmented them correctly? Are you encouraging word of mouth recommendations with great customer service? Do you have enough touch points to create an amazing customer journey?

The benchmarks might help us to understand the people behind them, but your focus should always circle back to the customer experience. That’s where real growth lives.

About Ziel Lab

Ziel is a boutique marketing lab, based in Bangalore, India, and we build laser focussed campaigns for your inbound and outbound marketing.

While our experience spans a wide variety of projects and disciplines, our clients all share one common thread: They are all serious professionals who excel at what they do, and understand thevalue of great campaigns. If that sounds like you, send us a message and let’s talk.


“Ecommerce Email Marketing: Industry Performance … — Klaviyo.” 15 Aug. 2019, Accessed 2 Nov. 2020.

“Benchmarking in eCommerce: How to Use the Data Wisely.” Accessed 2 Nov. 2020.