Direct Competitors: Everything You Need to Know to Stay One Step Ahead
Doing business always comes with some kind of competition. Yet, while many treat their competitors as a headache, they aren’t always a bad thing.
Yet, seeing them like this is often a challenge for many businesses out there. If that sounds like you, things are about to get better.
What if we told you that your competitors could become one of your best data sources? If this surprises you now, it won’t after you read this guide.
Today, we’ll share everything you need to know about your direct competitors — from how to find them to the best practices that’ll help you stay ahead of them over the years to come.
Contents
- What are direct competitors?
- Direct competitors examples
- Direct competitors vs. indirect competitors
- How to find direct competitors
- #1 Check what your clients are saying
- #2 Search on social media
- #3 Use your keywords in search engines or SEO tools
- #4 Read what people share on review platforms
- What should you look for when analyzing your direct competition?
- 4 tips to use your direct competitors’ analysis effectively
- #1 Make your value proposition irresistible
- #2 Work on your SEO game
- #3 Fill unmet needs
- #4 Team up with the best people
- Conclusion
What are direct competitors?
Direct competitors are businesses that offer the same (often almost identical) products or services as you. To become your direct competition, a company has to fulfill these three “requirements”:
- Have a very similar offering to yours.
- Satisfy the same client’s need as your product/service does.
- Target the same audience.
For example, whether you offer a firewall solution, bake wedding cakes, or create logos for medical businesses, your direct competition will do the same thing.
Of course, they might have slightly different positioning, offerings, target audience, and so on. But the foundation is pretty much the same.
Guess what? Normally, they also have similar pricing structures. So, it's safe to say that these companies are not trying to be like you; they are happy to replace you.
If the business world were a movie, they would be your doppelganger. The thing is that the direct competitors not only solve the same problem as you, but they’re also using the same methods.
As a result, they can significantly influence your business outcome. This includes how much of the target market you are able to get through to and even how much profit you make. That’s why they are your “most important” competition.
In fact, this type of competition can get pretty intense sometimes, leading to price wars or brand loyalty battles.
Yet, it doesn’t have to be anything of such a big scale. Often, you’ll see businesses trying to outplay their competition in guest posting, paid ads, or event sponsorships. We’ll also talk about the effective tips later. For now, let’s look at some examples.
Direct competitors examples
It's going to be very hard to think of a single brand without direct competition. After all, anything that attracts profit is going to have several people trying to make some gain from it.
Let's look at some famous examples of direct competition to help you understand their impact better.
Coca-Cola vs. Pepsi
Source: Watch Mojo
Quick question — who is one of the biggest Coca-Cola direct competitors out there? If you said Pepsi, you won! Both Coca-Cola and Pepsi have been popular brands for ages.
The two are targeted at young, trendy customers who need refreshments. Of course, their target audience goes beyond that, but let’s just leave it at that in this article.
Apart from offering similar drinks to a similar audience, their pricing structures are also pretty much identical. Even their campaigns seem to feature the same nostalgic and vibrant themes.
In the end, it's really up to the individual customer to choose their preference. Remember how we mentioned brand loyalty battles? That’s exactly what we see when it comes to Coke vs. Pepsi. Their fans can argue about how different these drinks are until they're red in the face.
This is a very typical thing for direct competition.
But there are also some very fun results that come out of this rivalry — memes. Both brands often use this “battle theme” in their marketing campaigns and PR communications. Like in these legendary ads:
Source: X
P.S.: Today, you’ll see that some sort of “mockery” is really widespread when it comes to direct competition. Speaking of which — here comes our next example.
Starbucks vs. Dunkin’
Source: The Omega
Starbucks vs. Dunkin' is another common example of direct competitors that everyone can relate to. For many people, coffee is the perfect start to their day. And these two big brands are always ready and eager to offer their products all year round.
Both Starbucks and Dunkin' brew coffee, sell pastries, and help caffeine addicts get through their day. Sounds like a perfect combo to us.
Basically, both brands have very similar menus. Of course, they aren’t identical. But the idea (i.e., the foundation) is the same. So, it's safe to say that both brands have their hands on a piece of each other's market share pie.
Do these businesses have any fun campaigns mentioning each other? You bet! How about a T-shirt like this?
Source: The Motley Fool
Samsung vs. Apple
Source: ZDNet
Don’t think it’s just the food and beverage industry that has to deal with intense direct competition. Nope. You can find it across the board.
In fact, it’s almost impossible to talk about direct competition in the tech space without mentioning Samsung vs. Apple. After all, the Android vs. iOS debate has been going on for decades now.
Both Apple and Apple’s direct competitors, like Blackberry and Samsung, target the same tech-savvy crowd. Well, at least BB did before Apple completely took them out of the competition.
Now, both Apple and Samsung have been fighting for total domination of the smartphone turf for as long as forever. Both brands have a sizable share of the market.
Of course, the share would have been bigger if there was no competition in the first place. But that’s what competition is all about.
Many of their campaigns also feature friendly teasing of the other. Want to see some of that?
Source: X
We’re adding these examples just to inspire you. Later, we’ll get to the section with the best practices on how to make the most of your competitors. Still, even now, you see that having competition isn’t always a bad thing. In fact, it can be quite fun.
Of course, these three cases aren’t the only examples out there. There are tons of other popular businesses.
For instance, Walmart, Costco, and other big chain retail stores are Target’s direct competitors. The same goes for Mastercard, American Express, or Union Pay in China, which are Visa’s direct competitors.
Direct competitors vs. indirect competitors
So far, we have tackled the direct competitors’ definition and looked at some examples.
So, this is the point where we break down the difference between direct competition and indirect one. Since this is something we've written about before in our previous blog, we'll keep it very short.
You already know who the direct competitor is — a business that sells similar products/services to the same audience.
On the other hand, an indirect competitor sells a different product or offers a service different from yours. But at the same time, they target a substantial part of your audience by fulfilling the same need your product/service fulfills.
Examples of this would be:
- A coffee house vs. a tea house: While tea and coffee are different drinks, these are both places to chill, have a warm drink, and maybe a small bite to it.
- A taxi vs. Uber: The idea is the same — a car takes you from point A to point B. But the user experience is different. See how indirect competitors work in real life?
So, why should entrepreneurs analyze both direct and indirect competitors? What makes the indirect competitor just as relevant as the direct one?
Since they are solving the same problem as you, they have the potential to replace you in the future. This is what happened with Kodak’s films and digital cameras. Or a classic example of Blockbuster and Netflix.
Today, we have a whole generation of people who have no idea what Blockbuster is. Even though it was once an entertainment giant before Netflix even existed. You don’t want this to be your story. That’s why it is so important to keep an eye on your competition.
If you feel like you need to learn more about your indirect competitors, we have this guide for you.
But now, let’s focus on finding out what direct competitors you have to monitor and how you can do this. That’s what the next section is all about.
It’s one thing to know you have competitors and another thing to know how to spot them. So, here are our best tips to make this part easier for you:
#1 Check what your clients are saying
None of us can get into the heads of our customers. Honestly, it’s probably for the best.
Still, there is an effective way to get a better understanding of what your clients think of you — ask them (better if anonymously). Yes, the most surprising solution ever!
Typically, businesses do this through their feedback forms. Wait, but what does this have to do with competitors? You see, apart from just asking how your team did or how your product was, you can squeeze in a question that leads to your competition. How?
Ask things like, "Where else would you shop for [your product type]?" or "What other businesses have you considered before checking us out?" These can vary, but you get the idea.
Of course, if you want to get more responses, you need to offer some sort of incentive (e.g., a gift or discount). This way, you just might get your customers to name-drop some competitors. Spoiler: You’ll normally see both your direct and indirect competition there. Handy, right?
Source: Fluent Support
#2 Search on social media
Social media isn’t only a powerful tool for promotion. It’s also an insanely helpful thing when looking for your direct competition.
No matter what platform we’re talking about, you can go there and start searching for your target keywords (e.g., “best lip gloss,” “best project management software,” etc.).
You can also look for people who matter in your industry and check their subscriptions. Probably, if they’re following some brands (no matter how small), they know what they’re doing. So, you should keep your eye on them as well.
Besides, don’t think that all these socials are only for fancy businesses. Don’t trust us? Then, check this out. Even car polishing machine manufacturers can use this tactic.
Source: TikTok
This research can also be helpful to find some creators you can collaborate with in your future marketing campaigns. If you come across some of those, just make a note of them for later.
The same goes for checking what your competitors are posting and what publications get to be the most successful. Of course, we aren’t doing marketing research here. But if you see something worth your team’s attention, just keep that in mind.
#3 Use your keywords in search engines or SEO tools
If you’re into SEO, you know how important keywords are. Pretty much no one writes blogs without doing proper keyword research before.
If you’re looking for popular search queries, most likely, your competitors will do the same. And because they’re intentional with their keyword usage, you can easily find them through search engines.
Start by simply googling your target keywords and see who comes up ranking for the same queries as you. Of course, pay more attention to those brands that appear on the first page, even if they aren't your direct competitors.
For example, if your target keyword is "best desk lamps for home office." When you type that into a search bar, you'll be able to find other companies offering desk lamps.
Plus, you’ll see tons of sponsored products and lists mentioning numerous brands. Go through all of these because it is useful to see who is using paid channels and who appears often in those listicles. If you aren’t there, maybe it’s time to change that. Who knows?
Source: Google
You can also use SEO tools like Semrush or Ahrefs for this research. They typically have a feature that allows you to see the keyword overlap.
For example, in Semrush, when going through the Domain Overview, you’ll see your Main Organic Competitors and a Competitive Positioning Map.
Source: Semrush
You want to pay extra attention to the businesses that appear for different variations of your target keywords. These are most likely the brands that are targeting the same customers as you.
Even if they don’t, check them out. What are they offering? Why do people like them? Besides, if they rank well, make sure to analyze their SEO strategy.
#4 Read what people share on review platforms
Ever notice how customers are absolutely honest on review platforms? This can come in handy when you’re looking for how to identify direct competitors.
The idea of this tip is super simple — go to any review platform, whether it’s Yelp, Capterra, or Trustpilot, and check what people are saying. You want to take a look at your reviews and the reviews of competitors you already know.
What happens is that people often mention some alternatives in their comments. You can see phrases like, “We’ve been considering X, Y, and Z before we picked X.” Or something like, “I’m now switching to XYZ because they have [feature name].” You get the idea.
These are the most valuable reviews ever, so make sure you analyze them in detail.
Source: Trustpilot
This will help you know exactly who your competitors are and why your target audience chooses them. Plus, often, you get the scope of what your offering might lack.
What should you look for when analyzing your direct competition?
What if we ask you, “Which of the following pairs is an example of direct competitors?”
“Amazon vs. Walmart” or “Visa vs. Mastercard.”
If you picked the latter, you’ve been paying attention to what we’ve been saying before.
Now, it's time to dig deeper. You want to be sure you know what to look for when analyzing your competition. Because simply listing tons of brands makes very little sense. Instead, pay attention to the following:
Product offerings and value
This is where you check how similar your competitors’ products and services are to yours. How exactly do they solve the same problems for your target audience?
Do they offer something absolutely identical? What packages do they have? What’s their messaging? In reality, there are tons of things you can learn here. Most of them will depend on your business, so just analyze what makes sense for you.
SEO strategy
We’ve already touched on this a bit while explaining how to find your competition. Still, getting some inspiration for your search engine optimization from other brands in your niche is a must.
You can see how they're getting organic traffic and how effective their moves are. Pay attention to the content types they use, the websites they get backlinks from, and the queries they target.
This can give you endless ideas for your own SEO strategy. The only secret here is to do this regularly because search engine optimization tactics are always changing.
Pricing structure
You want to understand how your competition’s price structure compares to yours, especially when it comes to the value of the services/products you offer.
When analyzing this, you may find that you're undercharging for some of your products/services or the other way around.
Note: Your pricing doesn’t have to be identical — not at all! Of course, your offers will differ, and that’s fine. The idea here is to check whether the price difference makes sense in terms of quality and/or functionality.
Social media activity
This involves knowing what platforms your competitors are on. But you also want to understand how they engage with their audience on different socials.
Do they maintain a funny, chill vibe or a more professional tone? What kind of posts get the most attention? Take notes of all these tiny details.
Reviews
What customers say about your competitors can really tell you a lot about how much of a threat they are to you. Sometimes, clients may mention why they prefer a particular business over others in the same niche.
This clues you in on what your competitors are doing right and wrong. Plus, this kind of intel is priceless when you’re coming up with your own marketing strategy.
As you see, there is a bunch of useful stuff you can use from your competition. If you take the time to do this analysis, you’ll definitely get a better understanding of how to position yourself and improve your product/service.
And if you want to boost your sales, research like this can be a lifesaver. All the data you find will help you come up with a great attraction marketing strategy to sell without selling.
4 tips to use your direct competitors’ analysis effectively
Now, you know who your competitors are and how to find them. You even know exactly what to look out for when analyzing them. What’s next? It’s time to check what to do with the data you gather in your competitor analysis:
#1 Make your value proposition irresistible
Every business has something valuable to offer. If you aren’t sure what the real value you provide is, sit down and figure that out. After all, this is the most important step if you want to increase your sales volume.
But how do you convince your target audience that your value proposition is far better than the one your competitors have? You have to start by convincing yourself first. It’s easier to sell a product or service you believe in.
What’s more? These days, so many businesses offer the same thing, so it’s not enough to just be like everyone else. Start by finding what makes you special compared to the rest of the pack. You can even make a list where you specify all the similarities and differences side by side.
Source: X
Then, try to see which one of you actually aligns with what your buyers really need. Hopefully, your side of the list stacks up more value than your competitors. If you find those areas where you meet your buyer’s needs but your competitors can’t, that’s your competitive edge.
Now what?
Well, you can use these insights in your marketing. Highlight those special areas where you are better than the rest in your marketing copies.
Source: Frontify
Keep in mind, though, that the idea is not to claim that their products/services are worthless.
No, instead, acknowledge their strength while thinking about how your offerings can make up for the areas in which they fall short.
#2 Work on your SEO game
The more competitive your niche, the more you need to work on your SEO. Why? Because SEO is all about visibility.
And if your competition is more visible than you are, they will definitely get more leads. They might not convert them well, but they will still attract them organically, thanks to SEO.
Say you've analyzed your competition’s SEO and content efforts. What’s next? Now, you want to compare them to yours. Are they behind, or are you? Either way, your main goal is to find some opportunities for improvement.
As you see, this whole guide isn’t about taking your competitors down. It’s about analyzing it and strengthening your own product or service.
So, for example, if there are content gaps that they are missing, you fill in those gaps.
Source: X
If you notice that some of their posts are outdated, you can create a more updated version. If there are some relevant keywords they are not using, well, you get the idea.
This will help you build a reputation as the go-to brand for helpful, up-to-date answers. A reputation that will lead to more organic traffic. After all, everyone knows that better quality content equals better rankings and happier visitors.
Want even more SEO tips? We have a handy list of relevant SEO ebooks that everyone needs. You will find everything you need to know and even a bit more.
#3 Fill unmet needs
Just like with SEO, the idea is to find where your competitors are not meeting customers' needs. It might not be that obvious at first, but if you dig through all the forums and review platforms, you’ll definitely find something.
People often say things like, “Oh, I wish they had this and that.” If possible, go and add that “this and that” to your offering. It will definitely give you an added advantage.
Source: X
So, if you are in the fintech app niche and you discover that most of your competitors market to advanced users. Maybe their interface is not so user-friendly even though there’s a decent stream of non-tech-savvy people who are introduced to the app daily.
You can decide to expand your own marketing efforts to help onboard this audience. How? Try to do your best to make your app easy to use. Create plenty of how-to guides to help new users get the hang of it and troubleshoot issues easily on their own.
This way, you’ll corner the market for beginners. Done right, you could build a lifetime loyal customer base and leave your direct competitors in the dust.
This is especially true if you find a way to keep up with the latest innovations while still making it easy for newbies to jump on board.
In reality, there might be plenty of improvement opportunities in virtually any niche. You just have to uncover them. And competitor analysis is one great way to do this.
For example, if you’re in the e-commerce industry, your competitor’s biggest weakness could be the fact that they never deliver on time.
Hah, this is one small weakness that can turn into a big win for you. All you have to do is be the business that offers similar or better quality with faster shipping.
One more thing — make sure you have a way to know how effective your efforts are. You can start with some kind of marketing KPIs that let you measure success accurately. You don’t want to waste your efforts on stuff that just doesn’t bring any results for you.
#4 Team up with the best people
Most businesses that go on to become those big names usually have to partner up with another company or two at some point in their journey.
Source: X
Sometimes, it’s just a collaboration for one big campaign that goes on to make an impact. Other times, it is an ongoing partnership. Either way, that is something you could try as well.
Source: Apple
How do you get in on this?
Well, from your competitor research, you might learn that the other brands in your niche are getting backlinks from so and so websites. Maybe a few more are sponsoring certain events or have collabs with other companies.
If you're able to confirm that this has been really valuable for them, you can then decide to do something similar. You don’t even have to start from scratch trying to find the best brands to collaborate with.
Your competitor analysis already gave you the answer to that. Now, you know (or at least can assume) which partnerships gave them the most engagement and which ones were not so efficient.
This way, you don’t have to repeat their mistakes. Instead, you can replicate their best strategies with a twist of your own and score even better results.
Pro tip: One of the strategies here would be to choose a direct competitor of the brand they work with. Say they collaborate with Nike, you can collaborate with Adidas or Puma. It works the same on any level, so these shouldn't be only the labels known worldwide.
Conclusion
Now, you know how to find and properly analyze your direct competition.
But there is one more thing, though. You don’t want to go into this with the idea that your competitors are your enemies. The kind you need to conquer and completely stamp into the dust for eternity.
Try to see them more as fellow innovators. They just happened to also be running after what you want. But this can be a good thing. Healthy competition is what drives growth. And hopefully, today’s guide has shown you that as well.
By
studying your competitors and acting upon that information, your
business will only get stronger. Think you’re ready for this? So do we.
You got this.
Sign Up
Sign Up