This article examines why the Google Analytics benchmarking reports should be approached with extreme caution or potentially avoided altogether and suggests more reliable methods for assessing true business performance.
Benchmarks are reference metrics that help you compare your business performance against the performance of other businesses in your industry.
Introduction #
Benchmarking might sound like a good feature on the surface: compare your performance against similar businesses and adjust your strategies accordingly. However, Google Analytics 4 (GA4) benchmarking reports come with serious limitations that undermine their practical utility.
Limitations of GA4 Benchmarking #
Why the Numbers Can’t Be Trusted
- Data Quality Concerns
Garbage In, Garbage Out
The fundamental problem with benchmarking lies in data quality. There’s no way to verify if other websites in your peer group have implemented their tracking correctly.
Inaccurate data tracking leads to inaccurate data collection: This can lead to skewed data, such as inflated or deflated metrics due to duplicate tracking or misconfigured analytics setups.
For example, when a website accidentally fires page view events multiple times, it artificially lowers their bounce rate.
This inaccurate data collection makes their engagement metrics look better than they actually are, even though it’s just a technical error.
- Key Event Inconsistency
Comparing Apples to Oranges
The key event metrics in GA4 present a significant challenge for benchmarking due to the inability to select a specific key event within the benchmarking reports.
Basically, Google Analytics (GA4) allows websites to define their own key events, but does not allow users to select specific key events for comparison within the benchmarking reports. This means that while one website might consider a “purchase” as a key event, another might track as a key event something as minor as an “add to cart” interaction, leading to comparisons that are not apples-to-apples.
This lack of standardization (arbitrary “key event” definitions chosen by each individual website) makes direct comparisons of key event metrics across businesses unreliable and potentially misleading.
- Lack of Context
Broaded Categories
The broad industry categories used in benchmarking often group together companies that are vastly different in size, business model and strategy, which consequently have different target audiences, traffic sources, conversion funnels and user journeys.
These different market dynamics within the same category dilutes the relevance of direct comparisons and can lead to misleading conclusions.
- Lack of Data Granularity
Missing the Full Picture
Since the data is aggregated and anonymized, the level of detail available to businesses is limited.
This privacy measure ensures that your data is protected but also creates a barrier, for companies seeking to utilize GA4 benchmarking, to gain a detailed understanding of their industry landscape. As a result, it becomes challenging to make informed strategic decisions.
The Limited Utility of GA4 Benchmarking #
Google Analytics 4 (GA4) benchmarking, due to these limitations, often creates more problems than it solves. Here’s why:
- Anxiety Instead of Insight
Companies frequently find themselves worried about metric disparities without understanding their true significance.
This can lead to:
- Generates unnecessary concern over metrics without context.
- Creates pressure to match potentially irrelevant standards.
- Distracts from focusing on own business objectives.
- Leads to questionable optimization decisions.
- Action Paralysis
Even when discrepancies are identified, information about the strategies employed by competitors is not available, making it difficult to understand the reasons behind their numbers.
As result:
- Difficulty in determining if the disparities actually matter.
- No clear path to improvement without context.
- Unable to replicate others’ success without understanding their strategies.
- Risk of making changes based on unreliable comparisons.
GA4 Benchmarking, analogous to the DDA (Data-Driven Attribution) model, operates as a black box. Both rely on Google’s algorithms not publicly disclosed.
Better Alternatives to GA4 Benchmarking #
Instead of relying on GA4 benchmarking, businesses should focus on:
- Internal Benchmarking
Focus on your own data:
- Track progress against your historical performance.
- Set goals based on your specific business context.
- Monitor the impact of your changes and optimizations.
- Understand your unique user behavior patterns.
- Focused Metrics Analysis
Instead of broad comparisons, concentrate on:
- Conversion rate optimization for your specific goals.
- User journey analysis within your context.
- Revenue and ROI metrics for your campaigns.
- Customer satisfaction and engagement metrics.
- Exploring Alternative Benchmarking Tools
Tools like SEMrush Market Explorer can provide valuable competitive insights:
- Analyzes market competition.
- Identifies key players in the industry.
- Provides market share data.
- Highlights potential growth opportunities.
By shifting the focus from generic industry comparisons to data-driven strategies that provide actionable insight aligned with specific goals, businesses gain deeper intelligence, enabling precise decision-making.
Conclusion #
While GA4 benchmarking reports might seem attractive for comparison and goal-setting, their practical value is limited by data quality issues, lack of context, and the inability to drive meaningful action. Organizations would be better served focusing on their own historical data, specific business goals, and measurable improvements rather than potentially misleading industry comparisons.