Short version: A benchmark is a comparison point used to judge performance, quality, cost, speed, or progress.
In business and marketing, a benchmark can be internal, such as last quarter’s conversion rate, or external, such as an industry average, competitor range, platform average, or best-practice example. The point is to make performance easier to interpret. A number without context can look good or bad for the wrong reason; a benchmark gives the team a reference.
A good benchmark should match the situation being measured. Comparing a new brand’s paid social results with a mature household brand can mislead the team. Comparing a landing page for a cold audience with a checkout page for returning customers is also unfair. Benchmarks are useful when they are transparent, comparable, and connected to a real KPI.
Related terms: reporting, KPI, and conversion rate.