Competitor analysis: what it is, how to do it and essential tools

THE competitor analysis It is one of the most strategic pillars for companies seeking to stand out in a competitive and constantly changing market.

This practice involves carefully observing competitors, their movements, their strategies and their results.

This makes it possible to identify not only the strengths and weaknesses of each competitor, but also the opportunities and threats that arise in this dynamic environment.

By understanding how other companies operate, your business can adapt, innovate and, above all, create competitive advantages.

Competitor analysis provides a deep and detailed overview of what is working in the market, allowing adjustments and improvements to be made in a more assertive and informed manner.

What is competitor analysis?

Competitor analysis can be defined as the process of identifying and evaluating a company's competitors, aiming to understand their marketing strategies, operations, products, pricing and customer relationships.

It is a systematic way of monitoring how competitors operate in your sector and how their decisions impact the market as a whole.

Through this monitoring, a company can adjust its own approach to maximize its competitive advantages and minimize weaknesses.

However, competition analysis goes far beyond simply observing tactical actions.

It should be used to predict future behavior, understand industry trends and anticipate potential changes.

This involves studying everything from competitors' financial data to market positioning, marketing campaigns, product innovation and how it is perceived by the target audience.

According to a survey published by Harvard Business School, companies that carry out a consistent competitor analysis are able to react more quickly to market changes, achieving growth of more than 20% compared to their competitors who ignore this strategy.

In this way, this strategy is a tool not only for observation, but for transforming insights into practical and innovative actions.

How to do a competitor analysis efficiently

To carry out a complete competitor analysis, it is necessary to follow a series of well-defined steps, ranging from identifying who the competitors are to constantly monitoring their actions.

The process, however, requires more than simply observing market movements.

It is necessary to interpret the data, find patterns and, above all, translate this information into practical actions for the company.

The first step is to identify your direct and indirect competitors. Direct competitors are those that offer similar products or services to yours, with the same target audience.

Indirect competitors may offer alternative solutions to the problem your product solves, and may not be immediately recognized as a threat, but they can exert great influence on customer behavior.

A classic example would be the transportation market: a taxi company competes directly with other taxi services, but indirectly with ride-sharing apps and even bicycles and scooters.

Next, it is necessary to define which aspects will be analyzed. This includes everything from brand positioning to product mix, as well as issues such as pricing, distribution strategy, customer service, communication on social media, and customer relations.

Ideally, the analysis should be multidimensional, covering not only operational aspects, but also subjective perceptions about how the public views competitors.

Data collection is the next step and is crucial to the success of your competitor analysis.

There are several ways to gather information about competitors, such as market research, customer interviews, analysis of publications and financial reports, and monitoring advertising and marketing campaigns.

Additionally, using analytics tools, such as SEO and social media monitoring platforms, can provide valuable insights into competitors’ digital performance.

Interpreting the data is perhaps the most challenging phase. It is necessary to compare the results of the analysis with the current performance of your own company, to understand the gaps and opportunities for improvement.

Not all of your competitors' strategies will be useful for your business, so you need to be discerning in order to adapt these practices to your reality.

The focus should not just be on copying what is working for competitors, but on learning from their mistakes and successes, and innovating based on these observations.

Finally, competitor analysis needs to be an ongoing practice. The market is constantly evolving, and so are competitors.

New players can enter the market, old threats can reinvent themselves, and to remain competitive, it is necessary to always be aware of these movements.

The importance for strategic decisions

One of the great benefits of competitor analysis is its ability to guide strategic decisions based on concrete data and market observations.

By understanding how your competitors operate, you can make more informed decisions about where to invest, how to improve your products and services, and even how to adjust your pricing to compete more effectively.

For example, when conducting a competitive analysis, you may discover that a competitor is investing heavily in technological innovation, which could indicate an upcoming change in industry behavior.

This may inspire your company to accelerate new product development or look for ways to offer a more technological experience to your customers.

On the other hand, you may find that competitors are investing less in areas like customer service or personalization, which could present an opportunity to stand out.

Additionally, competitor analysis helps you avoid pitfalls. Blindly copying what a competitor is doing can lead to poor decisions, especially if your business context is different.

Analysis allows you to see the big picture, understand why certain strategies work (or don't work) and assess whether they are applicable to you.

A good example of this approach can be seen in the e-commerce sector. Often, a company may be losing sales to competitors due to flaws in the user experience.

By identifying which usability and navigation elements are being prioritized by competitors, it is possible to make adjustments and optimizations that improve customer retention and conversion.

Competitor analysis tools: how to choose the best ones?

Choosing the right tools is essential to carrying out an efficient and detailed competitor analysis.

There are several platforms that can help with this process, offering everything from SEO data to insights into social media behavior and paid advertising.

The choice of tool will depend on the specific needs of each company and the level of depth sought in the analysis.

Tools like SEMrush, Ahrefs and SimilarWeb offer robust analysis of competitors' digital performance, allowing you to see their keywords, organic traffic, paid advertising campaigns, and even analytics backlinks.

These platforms are especially useful for companies looking to improve their online presence and understand how their competitors are using digital marketing to their advantage.

On the other hand, platforms like BuzzSumo focus more on content analysis, allowing you to see which posts from your competitors are being shared and engaged with the most on social media.

This can be valuable for anyone creating a content strategy and wanting to produce content that has a high engagement rate.

A practical example can be illustrated in the table below, which compares three of these popular competitor analysis tools:

Tool	Main Focus	Level of Detail
SEMrush	SEO, PPC, Marketing	High
Ahrefs	SEO, Backlinks, Traffic	Very high
BuzzSumo	Content and Engagement	Average

Choosing the right tool can have a significant impact on the quality of your analysis.

Furthermore, the use of these platforms should be complementary to other forms of data collection, such as field research and financial analysis of competitors.

Conclusion

THE competitor analysis It is an essential tool for any business looking to remain competitive and relevant in a constantly evolving market.

By studying competitors' strategies, it is possible to identify opportunities for innovation, improve internal processes and anticipate trends.

Furthermore, the use of specific tools can optimize data collection and analysis, providing valuable insights that help the company position itself more strategically.

It is important to remember that competitor analysis should be an ongoing process, not a one-off event.

The market changes, competitors evolve, and what worked yesterday may not be effective tomorrow. Therefore, constant monitoring is the key to long-term success.