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There are two secret keys to success with competitor analysis.
One, never obsesses with (and directly copy) what your competitors are doing.
And, two, look at both direct vs indirect competition for a complete overview of what’s working in the industry.
For the former, make sure you study the good and bad in various aspects of your competitors’ businesses. Then, double down on what’s working in your own way.
As for the latter, you have this guide where we’ll walk you through exactly what you can learn from direct vs indirect competition. We’ll also give you a quick recap of what each is.
So, on the whole, you’ll learn the following today:
Direct competition includes your industry competitors – the ones who serve the same product/service such as yours and possibly also target almost the same audience.
Let’s look at project management tools as an example. Some prominent names are Trello, Asana, Notion, and Airtable.
As a business, you can choose from any of these depending on several factors including which company’s marketing strikes an emotional and logical cord with you. This makes all four names each other’s competitors.
However, the competition doesn’t end at attracting the most customers. It continues on at retaining them too.
Let’s say you’ve picked Airtable. After some time, you realize it’s not meeting all your needs. Some folks in your circle have also been talking about how easy to use Trello is. Consequently, you end up switching to Trello whose marketing also spoke to you.
On the other hand, indirect competition includes competitors in your industry that don’t necessarily provide the same service/product such as yours but can satisfy the same need.
A typical example is that of water and coffee. While both are apples and oranges by nature, they can both satisfy thirst, therefore, are indirect competitors.
Let’s take another example.
Notion can be used as a CRM even though it’s basically a project management tool. But there are how-to tutorials and templates showing how Notion is used as a CRM. On the flip side is Freshsales CRM, an AI-powered CRM.
While both offer completely different value propositions, they are an example of being each other’s indirect competition.
That said, it’s essential you study both direct and indirect competitors.
But how many competitors should you monitor in total? The majority of our contributors (33.85%), monitor 3-5 direct competitors, and up to 3 indirect competitors (32.81%).
Other than this, 24.62% of our respondents keep tabs on up to 3 direct competitors. The same number also study 6-10 direct competitors. Only 16.92% track more than 10 direct competitors.
These are businesses from various fields including 35.4% from marketing agencies, 27.7% from the professional services industry, 16.9% from SaaS, and 9.2% from the eCommerce sector.
The remaining 7.7% and 3.1% come from education and other fields.
And how do these businesses study their competition? The majority of companies we surveyed use well-known SEO tools like Ahrefs ad Semrush (78% and 53%). Approximately 43% also use Google Keyword Planner and 25% use Moz.
Other tools mentioned include Buzzsumo, Similarweb, Mention, Link Explorer, Ubersuggest, and Spyfu.
With the definitions out of the way, let’s kick things off with a rundown of what you can learn from direct competition:
Now for the details:
Most marketers play it safe when it comes to marketing. So it makes sense to undertake to competitor study to find out what’s okay to do when you’re just getting started.
Minesh Patel of The Patel Firm, in particular, points out “There’s a fine line to walk between professionalism and showing the personality of your company culture.”
Hence, “monitoring the tone and content type my competitors are posting on social media and their website helped me ‘test the waters,’ so to speak, without putting my reputation on the line,” Patel explains.
“If a business sees big success with their marketing strategies with a more personal and vulnerable touch, it’s a green light to other companies that the formula can work.”
Streamlined user experience including an easy-to-navigate website and app, and a smooth onboarding experience are some winning factors for any SaaS business.
Using direct competitor research, PDFLiner’s Dmytro Serheeiv learned the same. “Analyzing competitor SaaS PDF editing platforms, which are very popular today, I learned how a streamlined SaaS experience must work.”
Says Serheeiv: “I noticed that the most popular services in the niche are also the easiest to use and don’t take a lot of time for you to learn how to use them. This understanding gave me the key to creating an assistive online PDF editing environment that offers unobtrusive guidance on all the editing stages.”
“The best thing you can pick up from competitors is the best practices from within the industry,” opines Jack Miller of How I Get Rid Of.
For example, you can determine what makes a good website and what your content marketing shouldn’t miss.
in fact, you can validate the smaller details by studying the direct vs indirect competition. Case in point: you can determine your blog, email, and social posts’ publishing frequency by studying how frequently direct competitors (as well as industry competitors) publish.
Miller, specifically, shares, “I remember doing this during our first years as content creators. I had a small team study and observe how many competitors did their social media posts, titled their articles using SEO, and created their content.
We all agreed to adopt some of them into our own style, and much to our surprise back then, it worked. There was a significant uptick in page views during that month.”
Related: B2B Social Media Strategy: 21 Ways to Drive More Engagement
Use social listening to eavesdrop on what your competitors’ audience is saying about them. To add, read through their product reviews to identify both their strengths and weaknesses.
Then, use the information to improve on what your competitors aren’t doing so well. In Social Plus’s Adam Moore’s case, this was customer feedback that they needed to work on.
“The most important thing I have learned from monitoring my direct competition is how important customer feedback is,” writes Moore.
“From comments and reviews left on their websites and social media, I am able to see what customers liked or did not like and take this into consideration when making changes to my company.
I have seen some consumers comment that other competitors had terrible customer service, and therefore I have focused a lot of my time ensuring that my customer service is top-notch in order to improve their experience.”
You can also dig up insights on competitors’ strengths and use them to reflect on your own progress.
The team at ExaWeb Corporation does this. Patrick Garde notes, “The most important thing I’ve learned from monitoring our direct competition is that it revealed our weaknesses. We’re thankful though as we see our competition as worthy rivals. This way, we’ll continue to work on the areas we need to improve.”
“Monitoring our direct competition has really helped us grow and shift our business in the right direction,” points out Alex Cascio from Vibrant Media Productions.
Admittedly, no business grows in isolation. So looking at how others are doing, the direction they’ve taken, and the things they focus on is crucial for your business growth.
As Cascio puts it, “It’s easy to put your head down and drive forward with a marketing campaign or ad, but knowing what your competition is up to and using the keyword planner along with other tools can prove to be extremely helpful in getting a competitive edge.”
Related: How to Use Google Keyword Planner to Research & Target the Right Keywords (According to 30 Marketers)
Here’s Cascio recipe for direct competitor research: “Monitor them on a few levels such as their marketing campaigns, what they’re doing on social (days they post, frequency, style, etc.), any article they are mentioned in/partnerships and also their customer service.”
“Hitting these points and setting time aside in our calendars have truly helped us stand out from a saturated market,” Cascio admits.
“Overall by monitoring our direct and indirect competition has led us to win more deals and gain further market share in our industry.”
Related: How to Do an SEO Competitive Analysis: A Step-by-Step Guide
This is key as ultimately you’ll win customers based on the value you offer. Hence, knowing the unique value your competitors offer helps you plan a better value prop to attract and retain customers.
This is exactly what Kevin Miller learned from competitor analysis. “What I learned from competitor research is that you must provide real value or no one will care about your brand or product.
You can do all the SEO in the world, but if people don’t feel like they are getting something of value when they visit your site, what’s the point?”
Millers writes, “I’ve also learned that small businesses have so many different approaches for their marketing campaigns, products, and services and it helped me realize that just because one method works for one company doesn’t mean it will work for everyone.”
Then, redo them in a better way. In fact, Adam Garcia of The Stock Dork made an interesting finding along these lines.
Garcia explains, “About a few years ago, I was monitoring a direct rival because they were getting more hits to their website. It was quite annoying since mine was much better and only after analyzing the backlinks, I came across the reason for their growth: guest blogging.”
“The amount of hits doubled for them after one of their leaders got featured on a decent website. I quickly realized that if they published my competitor’s piece, then they were likely to do the same for me,” continues Garcia.
“And to my relief, that is exactly what happened. In fact, monitoring them made me realize how important backlink analysis can be.”
The takeaway? Don’t just try to find out what’s working for your direct competitors. Walk the extra mile by first determining if it’d work for you then redoing the strategy in a better way than the competitor.
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This is uber-useful information to ensure you position your product in a way that’s different than your competitors and resonates with your audience.
For PromoPrep, Steve Lamar analyzed exactly this using direct competition research. “The biggest thing we learned looking at competitors was how they were positioning themselves in the marketplace,” writes Lamar.
“For instance, one of our largest competitors has been in the industry for over 10 years. They really started by creating content and writing content for marketers to increase their organic reach. This is how they established themselves and started to drive traffic and customers to their site.”
“We didn’t look at competitors from the standpoint of what their platform was doing, but it was more about how they were finding success from the marketing side,” Lamar elaborates.
“We tend not to look at competitors so much when building the product and try to focus more on our customers and asking them about their problems and what they’re trying to solve.”
“We find if you start chasing all the things your competitors are doing you’re either going to get frustrated or run out of money or both.” This goes back to the first point we made at the start of this guide – don’t obsess over what your competitors are doing.
Lamar opens up: “In the beginning, we also looked at competitor pricing just to gauge where our product would sit in the marketplace. Were we pricing things higher or lower, were we creating pricing plans that people would find are familiar.”
This is a helpful approach to set pricing since it’s always challenging for newcomers to convince their customers to pay more than already established businesses (who are their competition). In fact, getting customers to pay more requires earning their trust first, which takes time. So you can’t go about pricing on the higher end in the beginning.
Now, Lamar writes, “We regularly watch competitors monitor how they appear in search results. We have a set of core keywords we track like ‘marketing calendar software’ to see how our ranking matches our competitors. Although this does not drive our strategy, we keep an eye on rankings to see if the changes we make impact our rankings ahead of our competitors.”
In certain instances, you might even uncover that competitors are rewording your content. This is something Victoria Slingerland of Practice Quiz found out due to direct competition study.
“We learned from closely monitoring our competitors that they were scraping our content!” outlines Slingerland. “Sometimes they were running it through lousy AI to try to make it seem original to Google, but in other cases, they were just out and out copying it.”
“This was causing us to lose positions in Search. This monitoring allows us to take the appropriate legal and copyright actions.”
Only direct competition can give you this information so you can grow your business better.
In this regard, Lazarus Jackson from Modern Home Safety shares their experience. “I am the founder of Patriotic Logistics, LLC, a logistics motor carrier company, as well as the founder of ModernHomeSafety. Following what the known Motor Carriers like Swift in the trucking industry do is pointless for me. They have resources, experience, relationships, and a branded corporation that are not available to me.”
“All of the above-mentioned characteristics take time to develop,” Jackson points out. “When I began with my first semi-tractor I followed Youtubers, FB groups, trucker forums, and IG pages of small fleet owners with less than 5 trucks to learn where to park at night for my own safety.
As a result, I was also able to find out what insurance companies, freight brokers, fuel companies, truck stops, CPAs, etc would deal with a small one-truck operation,” writes Jackson.
“My direct competition gave me all of this information because they were still learning the ins and outs. There is a community feeling within these groups”
“In any industry, no one precisely shares what his/her business is going to do to achieve something,” notes Running Shoes Guru’s Ruggero Loda. “Until they succeed, the strategies which they use will remain as mere experiments and tests.”
“But once a business thrives the whole eyeballs will be on what they did to achieve it. Hence by constantly monitoring competition you can stay informed of your competitor strategies,” Loda advises.
“For my own website, initially I was just publishing shoe reviews but when I looked at my competitors, I realized that they mixed their content with shoe reviews and other informational posts. So I incorporated such blog posts on my site.
Also through constant content marketing monitoring, I noticed that my competition sites were bullish about telling people ‘How their reviews are authentic and independent’. Since even my website was taking the same approach, I also became transparent and started showing my credibility.
Randy VanderVaate from Funeral Funds of America agrees. “The most important thing I learned from monitoring my direct competition is content strategy.”
“I regularly monitor my direct competitors to see what content they are putting on the web. Seeing content from my competitors always inspires me to be better and write more engaging content on my site that is SEO optimized.”
Not only can direct competitor research help your content strategy but it can further your SEO strategy. In particular, Alistair Dodds from Ever Increasing Circles 2 has found success with its backlink-building strategy.
“We’ve consistently found great backlink opportunities by continuing to monitor our competitors,” Dodds shares. “We’re then able to replicate such backlinks to ensure we maintain a competitive edge in our organic rankings.”
Related: 30 Free Link Building Tips for Building Links On Little-to-No Budget
You can also use the information you find on competitors’ search engine performance to refine or change your overall SEO strategy.
Case in point: Seniors Mutual changed their online SEO strategy according to Kelly Maxwell.
“We looked at what pages our competitors were generating the most traffic from and made sure to have our own pages redone or a new one made if we didn’t have one already. This increased our traffic substantially and boosted our online presence,” Maxwell explains.
Finally, studying direct competition can also help you learn what resonates with your audience. For example, identifying your target audience helps you see if they like a light-hearted, fun brand voice or do they prefer a friendly, professional approach? What’s their key pain point that competitors are marketing around.
To this end, Simple SEO Systems’ Ronit Levy points out, “First, I learned the language, messages, and tone that appeal to potential customers. Second, I learned what kinds of messages, services, and products resonate with potential clients.”
Says Levy: “All of this data has helped me craft marketing messages, services, and outreach efforts that are appealing to the industries I work with.”
Now, for what gems you can pick from studying indirection competition:
For instance, Dmytro Serheeiv from PDFLiner analyzed the SaaS market and “noticed that many companies practice lead generation through how-to articles that cannot even be directly related to the features of the service.”
The result? They “integrated a weekly updated blog on the platform which increased the number of new monthly subscribers by 17% from the first month.”
Talk about using indirect competitor research to improve your business. But that’s not all. By studying your indirect competitors, you can also study the other effective ways they’re generating leads. In fact, studying their blog alone can give you a wealth of information on how to write better content and improve your conversion rate.
Related: Blogging for Lead Generation: 23 Best Ways to Generate Leads from Your Blog
“While direct competition can give you actionable insights and pinpoint the things you might be missing or doing wrong, indirect competition can also give you creative ideas on new directions or new angles that are underexplored, so to speak,” notes Adam Garcia of The Stock Dork.
“They will also be much more likely to collaborate with you,” Garcia observes.
“One example of how we leveraged our indirect competitors is also guest blogging. Only this time, we didn’t try to reverse engineer what they were doing. Instead, we got in touch and many of them were more than eager to collaborate, to mutual benefit.”
On a similar note, Cocodoc’s Alina Clark appreciates indirect competitor study for inspiring them.
“While indirect competition is not a direct threat to our business, we still monitor them because they provide a gold mine for data,” Clark comments.
“Monitoring our indirect competitors has provided inspirations behind some of our most creative product features and marketing ideas. To think of it, such ideas wouldn’t be alive if we restricted our monitoring to our direct competitors.”
This way, you can find yourself with a list of things that you should be doing in various business aspects for success. But be sure to standardize practices that work for not one but many of your indirect competitors.
Adam Moore from Social Plus highlights how they do this. “For indirect competitors, I like to simply look at how they have been able to grow their company and gain more customers.”
“From their logo choices and posts on social media. I have learned many valuable ways to engage consumers and what lingo and graphics work best to gain attention.”
Messaged.com’s Dan Ni echoes the same. Ni shares, “After learning the importance of monitoring our direct competition and realizing how crucial it was we decided to monitor all our competitors including our indirect competitors. And honestly monitoring healthy competition has great perks to it only if you look at it in the right light looking to learn.”
So what did Ni’s team unearth from studying direct vs indirect competition? The valuable lesson of networking.
Ni writes, “We learned a valuable lesson in customer acquisition and retention from our indirect audience. With our indirect competitors targeting the same customer base like ours, we noticed they had higher lead generation than ours and that is when we learned we had to grow our network more effectively by networking better and it truly helped us grow a lot.”
Vibrant Media Productions’ Alex Cascio points out, “It helps to find a market that is somewhat similar to yours in terms of demographics, as buying decisions/customers can be similar, even in states across.”
In fact, Cascio comments, “monitoring indirect competition is highly underrated.”
“We often look at markets outside of our regions to see what the ‘top players’ are up to. Which types of videos and blogs they are posting, where their markets are leaning, and what technologies are being utilized.”
All this helps them understand their customers and their buying decisions better.
55% of users admit they’ve returned a product simply because they didn’t understand how to use it. That’s over half (!) of the users. Meaning: you can’t gloss over the onboarding experience you provide.
And a good way to learn effective onboarding is indirect competitor research, advises Steve Lamar from PromoPrep.
Sharing their experience, Lamar outlines: “During product development, we spent a lot of time looking at other software platforms to see how they did their onboarding if they had product tours set up, and what the interaction was like after you sign up.”
“This helped us assess which systems we liked, which ones flowed well and which ones had unique ways of communicating with their customers,” says Lamar.
“We also did a lot of research looking at other tools other folks were using. For instance, we wanted to find out what tools people were using for live chat. So we went to other websites to look at the tools they were using and then test those out ourselves.”
In fact, Lamar shares: “We use a lot of indirect competitors to understand how we can better our product but it’s separated enough for our product so we’re not just copying what competitors are doing.”
“From an SEO perspective, many keywords we monitor and try to rank for are taken by indirect competitors. Review Sites like G3 and Capterra often take up top positions in rankings for software-type keywords. Also, other publications that do software round-ups often show up in top rankings.
So, we try to work with the indirect competitors to get listed in their roundups,” writes Lamar as they share another area where they use indirect competition to their advantage.
To this end, Lazarus Jackson from Modern Home Safety shares how studying indirect competition helped them.
“Watching my indirect competition like dispatching companies and broker companies gave me a different perspective of my role as the freight carrier in the world of logistics and transportation.
I came to learn what type of freight carriers they liked to work with and model my company after that knowledge which was not attainable in my network of other owner-operator truck owners.”
Keeping up with your indirect competition motivates you to keep doing better. Take Elice Max from EMUCoupon, for example.
“Beyond discounts, our website aims at helping people get a better handle on their personal finance. This makes many personal finance websites our indirect competitors,” says Max.
“What I have learned from them is to continuously create solutions. Some of the fantastic personal finance websites across the internet truly have the finger on the pulse of things.”
Max goes on, “they are able to craft strategies to deal with the ongoing inflation crisis, explain the BNPL phenomenon to interested shoppers and even help people prepare for the economic disruptions that might occur in 2022. In many ways, I have been inspired by these indirect competitors to deliver practical solutions when they are needed the most.”
Andrew Clark from DAVID.MARKET adds that indirect competition can keep you inspired. Sharing their experience, Clark writes, “Indirect competitors offer me a source of inspiration for content development that might be broader than my initial focus.”
“Additionally, I like to see what these entities are doing with their websites and other digital properties to spark my own creativity. A little bit of healthy competition and thinking, ‘I could do better than that’ drives me,” Clark sums up.
“Monitoring indirect competition keeps us informed about the overall state of our industry and aware of any major upcoming changes or trends,” notes Clare Jones of OfficeSpaceAU.
“This type of monitoring is extremely essential for an office space brokerage, considering the fact that changes to indirect competitors can result in market shifts or the emergence of new working models,” Jones explains.
“We often monitor the success of private leases undertaken by building managers or other private entities, as well as the emergence of boutique workspaces in certain cities.”
At YourParkingSpace, indirect competitor research has helped them build a better sales funnel, shares Charles Cridland.
“Monitoring indirect competitors allows us to see interesting solutions for building a sales funnel and better understand their user acquisition strategies,” observes Cridland.
“You can do it if you go all the way from the very beginning (for example, clicking on an ad) to the end of the free trial. A good idea is also to monitor changes in competitors’ websites and track their approach to messaging. You can just visit their home page once in two months to see if they are testing something new.”
In fact, you can also identify the different content types that indirect competitors create to nurture their prospects throughout the funnel.
Related: What’s the Right Content for Each Stage of Your Content Marketing Funnel? 40 Marketers Share Their Advice
“With indirect competition, we are gotten great ideas for expanding our business,” opens up Moriarty’s Gem Art’s Jeff Moriarty.
“With our product lines, we have expanded into other areas due to just seeing what some other companies in our industry are doing, even though they are not in direct competition to us. And these product lines have resulted now in about 20% of our annual revenue.”
“While we can’t gain the same kind of intelligence that we can from monitoring our direct competitors, we’ve found that monitoring our indirect competitors often helps with our content marketing strategy,” says Justin Smith of OuterBox.
“Oftentimes we aren’t going after the same keywords but we can see what related content is capturing the most traffic. These insights help inform our content strategy by uncovering new topics and ideas that we wouldn’t have thought to cover otherwise.”
Einsstark’s Deepak Kumar is on the same page. “Many times I have discovered that my targeted keywords often clash with other websites that aren’t particularly my competitors.”
“For example, I have published an article about ‘112 Best Chrome Extensions’ on my website and there are many others who have published an article on the same topic,” Kumar elaborates.
“But through monitoring, I discovered either they are promoting their extension or just writing because it is related to their businesses. In conclusion, monitoring my indirect competitors gives me a rough idea of how should I structure my content, number of words I go for, etc.”
Janice Wald from Mostly Blogging learned a similar lesson in SEO content marketing. Wald explains, “I learned that blogs with higher Domain Authority rankings have an easier time ranking for keywords. Often I find keywords I am knowledgeable about and believe I can rank for.
However, further analysis of my indirect competition shows I’d be wasting my time creating content that the big names in my industry with greater authority and longevity already rank for.”
Related: Keyword Difficulty Explained: What It Is and How It Impacts SEO
And that’s a wrap.
With all these benefits of tracking direct vs indirect competition, we’re certain you’ll take a serious approach to studying competition on the whole.
Meanwhile, here’s a parting tip to help you grow further: use dashboards to track your progress and get a competitor overview.
For instance, create a dashboard that tracks your competition’s domain authority, page authority, backlinks, and more. This way, you can see how others are doing at a glance.
Similarly, improve your business growth by tracking your own progress using dashboards showcasing essential metrics. Such dashboards make fresh data accessible to all – presenting progress in a visually engaging manner. This way, all team members can easily track progress and make data-driven decisions.
Ready to create dashboards? Sign up for Databox for free and start growing today.
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Masooma is a freelance writer for SaaS and a lover to-do lists. When she's not writing, she usually has her head buried in a business book or fantasy novel.
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