The structural health monitoring (SHM) benchmark study on optimal sensor placement problem for the instrumented Canton Tower has been launched. It follows the success of the modal identification and model updating for the Canton Tower in the previous benchmark study, and focuses on the optimal placement of vibration sensors (accelerometers) in the interest of bettering the SHM system. In this paper, the sensor placement problem for the Canton Tower and the benchmark model for this study are first detailed. Then an information entropy based sensor placement method with the purpose of damage detection is proposed and applied to the benchmark problem. The procedure that will be implemented for structural damage detection using the data obtained from the optimal sensor placement strategy is introduced and the information on structural damage is specified. The information entropy based method is applied to measure the uncertainties throughout the damage detection process with the use of the obtained data. Accordingly, a multi-objective optimal problem in terms of sensor placement is formulated. The optimal solution is determined as the one that provides equally most informative data for all objectives, and thus the data obtained is most informative for structural damage detection. To validate the effectiveness of the optimally determined sensor placement, damage detection is performed on different damage scenarios of the benchmark model using the noise-free and noise-corrupted measured information, respectively. The results show that in comparison with the existing in-service sensor deployment on the structure, the optimally determined one is capable of further enhancing the capability of damage detection.