I have worked in the advertising and marketing industry for a long time, and the first thing that we always do when evaluating a new client is: are they under or over industry standards? On website conversion, on cost per click, on frequency of posting, on engagement...etc
While I support some sort barometer for comparison, average industry standards should be a guide, an initial way of gauging the opportunity but certainly not the only or last one. Industry Standards are an average at best, a median of a group performance or an approximation most of the time. For the beauty industry, as an example, I have found standards on website conversion from visit to order of 3%, 5% or up to 13%. Big difference!!!
One main problem I see with Industry Standards is, they are compounded by different companies with different business models. In the beauty industry what works for Sephora, proactiv or Clinique may not work for you. The way they convert a lead and the ROI they get may not fit your business model. As an example, a common practice in direct response beauty industry is for brands to lose money in the first sale to secure a continuity model (future sales with automatic refills). Can your business afford that? do you have the technology for an automatic refill of products or a loyalty program that will secure future revenue?
The best way to know if you are doing well is to get the "Nirvana Number": compare yourself directly with a competitor that is in the same industry, product, business model and marketing budget as you do. But how easy is it to get that directly from your competitors? Impossible. Maybe no, I bet you know at least one Nirvana Number ...YOU... Your past history and rate of improvement over time. How to get your own Nirvana Number?
1- Do a breakeven analysis, know what you can and can't afford in your business model
2- Establish goals, you may want help from an expert on what is realistic and what is not.
3 - Then and only then compare your self to industry standards. They may be at hand and achievable, GREAT! They may not, get help to see if you are missing something in your road map to greatness. However as long as your consumers are happy, your business is profitable and your are improving year over year, your business should thrive.
4- Go back to step 1 periodically. Things change and the world evolves.
If you need a hand to do analyze data like a pro, Let's chat.
By Naira Perez