Benchmarks Walkthrough

This guide will explain what benchmarks are, how they’re calculated, and how to access and interpret your benchmarks to see how your metrics stack up in your industry.

What are benchmarks?
How benchmarks are calculated
How to access and interpret your benchmarks
How to opt-in/opt-out of benchmarks

What are benchmarks?

Benchmarks are data points that give you context for how your business metrics compare to related businesses in your industry. This makes your metrics much more actionable.

A good example is your 90-day repurchase rate. Without having a sense of the distribution of repurchase rates of similar Shopify stores, it’s difficult to know how much room you have for improvement. If your repurchase rate ranks in the bottom quartile of your industry, you’re likely leaving money on the table by not focusing on how to boost repeat sales. If you’re in the top quartile, perhaps your resources should be focused elsewhere.

The same can be said of other metrics such as average order value, gross margin, and blended CAC. You know which direction you want these metrics to go, but without industry benchmarks, it’s hard to establish realistic targets.

This is why we built our Benchmarks tool.

How benchmarks are calculated

When you create your Lifetimely account (or when you log in for the first time after the launch of our Benchmarks tool), you’re given a short 4-question survey to help us categorize your business.

You’ll be asked to select:

Your business model (whether you sell your own brand, resell other brands, or dropship)
Whether you sell consumable or durable goods
Which product category best describes your shop
If you sell to businesses or consumers

Your answers to these questions determine which stores we use as a comparison for your metrics.

Let’s say that based on your survey answers, we find 40 reasonable matches for your store. We’ll then create bell-curve distributions based on 11 different metrics, with specific values provided for the median, the 25th percentile, and the 75th percentile for each metric. We'll also plot your business's value on each curve. All data is completely anonymized.

⚠️ Note: To make sure your benchmarks aren't skewed by a small sample size, we require a minimum number of businesses in an industry before calculating metric distributions. If we haven’t reached this threshold for your industry, then we’ll hold off on calculating benchmarks until the threshold is met, at which point we’ll send you an email to let you know that your benchmarks are ready.

How general performance ratings are calculated

General performance ratings are determined by averaging your store's position relative to similar stores across all 11 benchmark metrics.

How to access and interpret your benchmarks

Accessing your benchmarks

To see your benchmarks, click on the Benchmarks tab in the left-hand menu.

Once benchmarks are ready for your industry, your report will look like this:

1

In the top left of your report, you'll find the survey answers that we've used to categorize your store. These answers can be modified with the pencil icon in the bottom right of the window labeled "Edit".

⚠️ Note: Changes to your answers can only be made after there are enough stores in your current category.

2

In the top right of the report, you’ll see a measure of your business's general performance based on your positioning in your industry across all 11 benchmark metrics. Your performance is given as the quartile in which your store ranks relative to similar stores.

3

The rest of the report charts your benchmarks for the following 11 metrics:

P&L metrics
- Net sales
- Contribution margin
- Gross margin
Order metrics
- New customer AOV
- Repeat customer AOV
Retention metrics
- New customer repurchase rate, 90 day
- New customer repurchase rate, 180 day
- Repeat customer repurchase rate, 180 day
Acquisition metrics
- Blended ROAS
- Blended new customer CAC
- Marketing % of net sales

Understanding your benchmarks

There are four numbers provided for each benchmark:

1: Your business's calculated average for the metric
2: The median metric value across all businesses in your industry
3: The 25th percentile metric value across all businesses in your industry.
4: The 75th percentile metric value across all businesses in your industry.

The quartile in which your business ranks will be shaded either green (top 25% or 25-50%) or yellow (50-75% or bottom 25%).

👉 Keep in mind that for some metrics (such as Blended new customer CAC above), a lower value is preferred, and in these instances the bell curve distribution will have list higher values on the left and lower values on the right.

How to opt-in/opt-out of benchmarks

You can opt-in or out of benchmarks at any time in the Privacy and Personal data tab of your Settings.