Lionel Messi, who left Barcelona for Paris Saint-Germain last summer, won the Ballon d’Or for a record seventh time on Monday.
The 34-year-old Messi led Argentina to the Copa America title in July and has scored 40 goals in 2021, including 28 for Barca.
Benzema, 33, finished fourth behind Messi, Bayern Munich striker Robert Lewandowski, and Chelsea midfielder Jorginho.
In his Madrid press conference on Tuesday, Ancelotti was asked if the Ballon d’Or “still has credibility” following Messi’s latest victory.
“We have to respect the decision. Messi won and he’s still a great player,” Ancelotti said.
“For the players, individual awards are important and they give motivation – but if they don’t win them, it doesn’t matter.
“Benzema has had a great season and finished fourth and now he will have extra motivation to finish first next year.”
Ancelotti added: “It’s an important award but it’s still individual. Karim Benzema isn’t crying about not winning it, nor Thibaut Courtois. They have accepted it without any problems.”
Ancelotti said he would have voted Benzema, Vinicius Junior and Luka Modric as his top three.
Vinicius scored a scintillating late winner against Sevilla on Sunday as Madrid moved four points clear at the top of La Liga.
They could extend that advantage to seven points by beating Athletic Bilbao at the Santiago Bernabeu on Wednesday.
“I don’t know if we are favourites for La Liga but we’re playing well and we’re consistent,” Ancelotti said.
Ancelotti also said Madrid will not sign any players in January but admitted unhappy players could be allowed to leave.
Some players like Isco and Eden Hazard have found themselves out of favour under Ancelotti this season.
Ancelotti said Hazard will be available against Athletic Bilbao but insisted the Belgium attacker “must improve his fitness because he’s had problems of different kinds.”
“I don’t like January signings much. If we have players who aren’t happy, it’s something we can think about but we are not going to sign anyone.
“We have enough to compete until the end of the season.”