This is a historical post from 5 March 2008. Benchmarking has since been removed from Google Analytics.
Google has released the new benchmarking feature which allows you to compare your site to data provided from similar sites. We are now able to not only see internal site context (i.e. how different pages or areas of your site are performing), but how a site is performing within industry context (i.e. how the site compares to similar sites).
The new benchmarking report allows you to better understand overall site performance.
In order to take advantage of the new benchmarking feature you will need to opt-in on your Account Settings page, Google will then anonymously share your data within your industry vertical to generate reports. If you do not wish to share your data, then simply select "Do not share my Google Analytics data".
Along with industry benchmarking, Google Analytics now allows you to opt-in to share your Google Analytics data with other Google products, this will allow for integrations with AdWords, AdSense and other Google products.