Benchmarking in eCommerce: How to Use the Data Wisely

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Last updated
Apr 30, 2020

I’ve had benchmarks on the brain recently.

What kinds of data are genuinely valuable for brands as they grow, and what metrics lead them astray? Are there points in business growth where industry benchmark data becomes more or less useful?

It’s something a lot of brands struggle with- figuring out where they should fall compared to other businesses in the industry, and understanding how to act on those metrics. It’s not easy.

So let’s see what the community has to say! I reached out to the DTC Twitter Mafia (patent pending) and boy howdy did they come through.

Let’s walk through the most important questions to ask when considering industry benchmarks.

Is the data even comparable?

The #1 problem with benchmarking is that it’s really difficult to compare apples to apples. When looking at industry-wide (or even vertical-wide) benchmarks, you’re actually comparing apples to blueberries- or something like that.

Brands are unique, after all. Averages can 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.

David Hoos of The Good has some great advice on benchmarks:


Dan Brazelton (co-founder of The Bitter Housewife) recommends taking external benchmarks with a grain of salt. In his words:

“Other businesses benchmarks only tell you what is possible (if they are truthful and accurate). But they don’t tell you if it’s a good idea, profitable, or [even] applicable.”

Is the data actionable (and is the action even correct)?

Okay, so what can you do with your benchmark metrics? Data is a tool for understanding the larger picture, but without context (and a rock solid focus on the unique experience your brand provides), things can get sketchy.

In the words of Digitally Native: “The goal for any brand is to create unique value for the end consumer, so modeling yourself off others even in terms of operating benchmarks / KPI is a step in the wrong direction.”

Matthew Parvis of Fresh Clean Tees recommends setting internal benchmarks and using the term “stay in your lane” in every decision-making process. In his mind, the danger is choosing to “make a change for the sake of making change. That typically leads to mistakes.”

So be aware of the tradeoffs involved in chasing benchmarks.

Duncan Blair from DTC furniture brand Article cautions that “Pursuing improvement in/focus on something because you are 'below industry benchmark' sometimes comes at the expense of that which makes your brand compelling.”

And this gets even hairy-er when companies try and benchmark their retention. Here’s Ken Johnson from Churn Buster:


It's more important to focus on your unique approach and customer priorities than what's going on around you.

Before you apply any industry benchmarks to your goal-setting, ensure you have outlined how you differentiate, and never let a benchmark steal your focus.

So is benchmarking ever actually useful?

There has been a single recurring theme in my conversations about benchmarks: they aren’t necessarily a great way to approach your business, but.

And it’s a big but. (🍑?)

There are edge cases where benchmarks can be useful: when they’re either super broad or suuuuper specific.

Let’s cast the net wide, first:

For newer brands, benchmarks can help understand how your business fits into the broader market.

Kevin Lee says benchmarks are “helpful to us now since we're very early and need some benchmarks while running paid experiments to make sure we're directionally correct.”

But again, the most important thing to remember here is that internal measurements will give you a better understanding of growth.

According to Jamey S: “They (benchmarks) are great for a starting point and reference points if they represent a very similar brand/product. But your business growth (and all measurable data) should be measured upon itself. Focus on your constant improvement and execution.”

Benchmarks don’t always have to be data-driven either. There are other ways to analyze bigger trends.

Founder of Haus, Helena Price Hambrecht, has an interesting take. She looks at benchmarks in a broader sense.


Essentially, you can use broader benchmarks to understand how your brand approaches your market in context of the other businesses that surround it.

Getting specific:

Rather than only looking at broader concepts (like average CACs for the industry), more specific benchmarks can help you hone in on smaller elements of your business (albeit, they’re much harder to find).

Marketing, for example (and content in particular), is a lot easier to benchmark than retention, because the data is more readily available. Competitor insights on platforms like Moz and Ahrefs are absolutely loaded with information about pageviews, backlinks, and keywords.

eComm specialist Dan Barke expands:

“Averages within an industry are not so useful, as the variance can be so wide that the average tells you next to nothing. Info about individual cases can be very useful.”

He recommends looking for averages from specific brands wherever possible, “as you can work back the differentiating factors between you and them… and figure out what you may change to improve.”

So let’s say “beauty brand X's average item price is Y, cart = Y*1.4, prospects convert for them at 0.8%, returning customers convert at 4.8%.”

In this example, you’re still working with averages, but the data is internal 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 other parts of your marketing can you benchmark? Zeeshan Sheikh recommends looking at email open rates (Klaviyo has a great guide) to help put your email into context.

Benchmarks can be tempting to use when looking at conversions, but, again, be mindful in your approach. Corey O’Neal from Madison Reed put it this way:

“I don’t care that a site’s conversion is X% because their sources of traffic and levels of intent are totally different than mine.”

The Current State of Benchmarking

  • Industry benchmarks are general. Your brand is not- or at least, it shouldn’t be.
  • Understanding the direction of the broader industry is important, but goal-setting should be internal.
  • When you do compare, look for the most specific data possible from the most similar businesses you can find.
  • Benchmarking retention is not possible.
  • Think about benchmarks in terms of aspects of your brand and your processes, not your overall growth.

In a nutshell: the data is rarely specific, but your approach to it should be laser-focused.

In the end, it’s the customer experience that will stand out and move the needle on these metrics. Is your content valuable and targeted to the needs and interests of your customers? Are you encouraging word of mouth recommendations with great CS? Are you creating joyful touchpoints across the customer journey?

I think that’s the most important thing to remember when it comes to benchmarks.

The metrics 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.