We have been stuck with the term "benchmarking" for a while when doing our SWOT analysis or simply analyzing our competitors. Very often, we associate benchmarking with offline business.
Digital benchmarking, on the other hand, is determining the online performance of the company in terms of online marketing, online sales, online orders, online branding, etc.
Businesses in Online Gear
Today almost every company's performance depends on technology and internet, making digital benchmarking extremely important. We don't need to focus and spend as much time on logistics, business processes, infrastructure and traditional marketing as we used to before, because right now business is about driving online sales and getting clients online. So when thinking of your competitors or industry leaders we shouldn't focus on the basic business questions, instead let's focus on the internet side.
Let's Analyze How
Salesforce is getting its clients through digital marketing, Morgan Stanley is using social media to build up online community, Goldman Sachs has started online podcasts to attract more attention online; Alibaba and Amazon are winning in e-commerce.
Startups, SMEs and even large enterprises should focus on these types of cases to stay in the market and find their own competitive edge.
Digital Benchmarking has the Answers
Digital benchmarking gets the answers related to online performance. This analysis opens up the very hard to answer questions such as how did a basic app company get viral? What are the key factors? When launching the next Uber or the next Airbnb, you have to analyze industry leaders from A to Z. You have to take the whole journey of how they get their clients online, what process does the client follow to go through online? How does the payment work online? After going through all of the findings you will then have to think where you can add your unique value proposition as your competitive advantage.
Formula for Online Branding
Consider this. Unicorn, app-based companies don't do any offline marketing. 95% of their enitre success is based on online customer acquisitions and online marketing. You have to figure it out how they do it and that's where digital benchmarking comes in handy. To make it easier, I have made a formula on how to get your digital benchmarking right:
We all know that financial companies like J.P. Morgan and Merrill Lynch are well known and well branded but when it comes to online branding, how much do we see those financial institutions performing with equal dexterity?
Our grandparents and our parents definitely know the big banks but there are lots of millennials who have never heard of those banks before.
From traditional Marketing to Online Branding -- Banks Doing the Right Thing
The most successful banks in the world have started hundreds of years ago and the business was spread by word of mouth and traditional marketing. However, the banking industry has not stopped evolving as there are new financial institutions, formed every year, with revolutionary mobile bank applications.
There are more and more new digital type of banks launching every year, which are going fully digital and their visibility depend on their online performance. In other words, their online visibility relies on online marketing.
Difference between Traditional and Modern Banks
Most of Gen Z haven't heard or seen any of the traditional enterprises, which were founded in the late 70s, 80s and 90s. The difference between the traditional banks and newly formed banks is that the latter are digital natives and traditional banks have to adapt to technology development and online branding experience.
The result is that traditional banks have to actually spend money and efforts in order to be able to appeal to the new generation whereas newly formed, modern banks don't have to spend a penny to get instant popularity.
In terms of digital visibility, traditional banks are not really pushing their marketing efforts online as much as they should. It is very likely that due to lack of digital marketing, traditional banks may lose the brand to newly formed ones which are, from the very beginning, based on online performance.
Mobile Banks May Become Leaders in 10 Years
For many years from now traditional banks will, most likely, still have the power and the market share, but due to fast changes in the current market, it may take only 10 years for newly formed mobile banks to actually overcome the traditional banks.
When building your company, think digital first and make sure your business can be scalable online, either it's B2C or B2B, global online scalability is a must for absolute survival.