It’s human nature to compare yourself to others. In business, that translates to everything from “How much do they charge for their widget?” to “Is their office bigger than ours?” But business comparisons lead to incorrect expectations and can limit your growth.
Comparisons sometimes are a guide to making what you might think is the “correct” decision. Let’s say ABC Company and XYZ Company are in the same business as you. Through some research, you learn that both companies spend about $5,000 a month on their marketing. When it’s time to set your own marketing budget, I’m betting you’ll be around $5,000 a month.
Don’t Compare Yourself to Average
The comparison paradigm is often applied to metrics. A whole industry has been built around tracking “average” marketing metrics such as click-through rate, cost per click, impression share, conversion rates, Google search rank and variations of return on ad spend (ROAS). Clients need to know how their online marketing is performing, but whether your click-through rate is above or below the mean doesn’t tell you whether or not your marketing works.
Especially now, as the world grapples with the Covid-19 pandemic, last year’s averages are meaningless.
When you compare your marketing to someone else’s, there are too many variables to make worthwhile comparisons. Is the market for outdoor swimming pools the same in North Carolina as it is in Minnesota? Is one business launching a new product going to get the same results as another that is promoting an email registration? Is one brand more recognizable than the other? How do the businesses’ personalities differ? And on and on …
Averages Ignore Uniqueness
By their nature, averages ignore the characteristics that make each business different. That’s one reason it makes more sense to compare your marketing metrics to past performance, with a goal of improving the metrics over time.
A marathon provides a good analogy. There are two levels of competition. Elite athletes run to see who is fastest. But the rest of runners in a marathon have different goals. First, they want to finish. Second, they want to finish with a better time than the last time they ran a marathon. They’re competing against themselves.
Other athletes do it, too. From season to season, baseball players want to improve their batting averages or the number of home runs they hit. Basketball players want to score more points or grab more rebounds. They’re competing against their own past performances to improve their results and, hopefully, their teams’ records.
Are You Better Than Yesterday?
Apply the same principle when it comes to analyzing your marketing metrics. How do the results compare to last week? Last month? Last quarter? Last year? If you’re using Google Ads, is your click-through rate improving? Are more people taking the action you want them to take?
If you’re focusing on search engine optimization, is your website traffic increasing?
When you compare yourself to past performance, you have more control. You can see what tactics work best for you without worrying as much about what competitors are doing. It doesn’t mean it will be easier to make improvements, but focusing on your own results clears the path to finding answers.
Self-comparison lets you set the bar for your own performance. Why settle for average?