Digital Marketing Competitor Analysis: Examples & Guide

Date : June 10, 2024 By Andrei Iunisov

Digital marketing competitor analysis: the definition

The process of actively analyzing and researching competitors and their strategies within a specific market is called marketing competitor analysis (or competitive analysis). It plays a significant role in multiple crucial processes within a company, such as marketing and sales strategy and planning, product development, operations, and finance.

The rapidly evolving landscape of digital marketing also affects how competitive analysis is conducted. The overall digital environment of a particular industry can change drastically at any given moment, leaving many companies in the dust if they are not prepared.

Digital marketing competitor analysis can offer numerous insights to marketers willing to invest time and resources. The obtained insights can be used to adjust digital marketing strategies and improve marketing numerical results.

Why is competitive analysis a necessity in digital marketing?

Being able to understand the strategies and capabilities of your competitors is a unique advantage that can offer plenty of ways to boost your own capabilities in this field. Alternatively, comparing your own capabilities with the rest of the market offers plenty of insights when it comes to identifying weak points to improve on and advantages that are yet to be explored.

With that being said, there are more specific advantages to digital marketing competitor analysis that can be presented, including:

• Setting up realistic objectives for your digital marketing campaigns;
• Creating a more effective mix of traffic channels to fulfill your objective;
• Investing into traffic sources that are performing well for the industry;
• Better budget allocation after learning how competitors manage their resources.

The list above is far from conclusive, even though the general idea of digital marketing competitor analysis is simple – most modern industries are extremely competitive, and tools like these are one of the very few methods that can help companies stand out in the sea of similar products and services.

Selecting competitors for digital marketing analysis

It is safe to say that analyzing every competitor to your business is an unreasonable task. There are dozens of direct competitors to practically any product or service and hundreds of other companies that indirectly compete with the same industry. As such, the first crucial step is choosing the correct competitors to analyze. There are three classic competitor types that marketers review during the selection process. These types are:

• Direct competitors are companies and businesses that work within the same market segment and offer similar products or services.
• Brand competitors are similar to direct competitors but rely primarily on their strong brand identity as the primary tool in the competition (in most cases, more prominent and well-known companies).
• Indirect competitors are companies and businesses that target the same market segment but offer products or services that solve the customer’s tasks differently.

However, the most significant point of contention for digital marketing is traffic. Every business that draws traffic away from your website is your competitor — whether through referrals, social media, organic Google search, or PPC campaigns.

That being said, my recommendation for competitor selection is to look for direct and indirect competitors that ultimately compete with you against the same traffic. I recommend avoiding competitors who are not active in the digital field; this saves you time and resources. On the other hand, even if the competitor is indirect, it is still better to consider them if they compete with your company for the same traffic.  

Can we trust third-party competitive web data?

Many different channels can be used to gather information about a specific organization. However, simply collecting this information wastes time if the data can not be analyzed afterward. A significant issue for competitor analysis in digital marketing is that not much public information can be found about a single company’s marketing activities. On top of that, most of this information is not numerical. Analyzing your competitors’ digital marketing strategies has always been challenging because of the need for numerical data. Intuitive competitive analysis builds its insights on more than just visiting a competitor’s website and looking at how the pictures and text are arranged. 

Gathering and analyzing precise statistical data is crucial if you want your analysis to be insightful. The accuracy of competitive web data has improved significantly over the last ten years, and recently, AI tools have emerged to help solve the problem of the upcoming “3rd party cookieless” Google Chrome. Subsequently, trustworthy competitive data and analysis are essential in any digital project. 

Here are some of the criteria I use when deciding to use data or not: 

1. Constantly evaluate the credibility of the data source. Well-known analytics providers have more reliable data due to their robust data collection methodologies for broad timeframes.
2. The relevance of the data is critical. Ensure your data is up-to-date, as information needs to be updated to avoid misguided strategies.
3. Understand how the data was collected. Different methods can yield various insights, and knowing this can help you better interpret the data.

Whenever possible, verify the third-party data with other sources. This can help confirm the accuracy of the insights. While third-party competitive web data can be precious, it should be critically evaluated and ideally used with other data sources and your primary research to make the most informed decisions.

What type of competitive data can we analyze?

With the current tools, we can find out the following about the competitor’s website:

• What traffic sources does the website have?
• How exactly are they working?
• Are they effective in terms of conversion rate?
• What budgets are competitors spending on them?

On the contrary, you can identify areas where competitors did not focus and spend and, therefore, understand your growth points. This might involve under-invested marketing channels with low traffic and higher conversion rates. In addition, identifying competitors’ content gaps can enable you to produce effective campaign assets, which could attract traffic and leads for your site.  

What tools can be used for competitive analysis in digital marketing?

The most reliable method of obtaining web data is a counter on your website. Still, you can not install it on your competitor’s website and instantly get all the metrics. Competitive intelligence on the web employs services like SimilarWeb, which rely on data from various sources to provide insights into website traffic and other digital metrics.

The first source is a partnership with third-party data providers, which compile information from various sources, including transactional data, toolbars, surveys, and other forms of market research. For example, a toolbar is a program installed in the user’s browser. As soon as you install such a program in your browser, all your actions are tracked: what sites you visit, how much time you spend there, and what you do on them.

The second source is anonymized traffic data from internet service providers, which can be used to estimate website traffic and engagement levels. ISP servers also retain information on which pages you visited, how much time you spent on them, etc.

The third source could be panel data. Some data providers employ networks of opted-in users who agree to share anonymized and aggregated information about their browsing habits. 

The combination of these sources allows platforms like SimilarWeb to offer a comprehensive view of a website’s traffic and digital marketing strategy. It is vital to understand that this data is not 100% accurate. Still, it is correct to use it to identify trends and provide valuable insights for strategic planning.

SimilarWeb is a significant analytical tool; one of its excellent bonuses is the free version. Its free functionality is enough to analyze at least some insights for any considerable site. To be statistically significant, I recommend having more than 5,000 visits per month in SimilarWeb. 

You can assess the trend with statistically significant data, such as whether the traffic on the competitor’s site is increasing or decreasing. Accordingly, you can conclude what analytical decisions to make.

How to use SimilarWeb for competitive analysis?

As a starting point, here is what you can check in a free version of SimilarWeb. 

• Overall traffic;
• Desktop vs. mobile traffic share;
• Average time on site;
• Average session depth; 
• Bounce rate;
• Traffic sources.

You can look at up to 5 competitors simultaneously to examine these metrics for all your competitors.

What insights could you get? Examine the overall traffic level and its trend for the last three months (this timeframe is the limitation of the free version). Find out how responsive the competitor’s website is for mobile and tablet devices. Evaluate to what extent the competitor is using mobile traffic acquisition. Align this information with traffic sources, engagement metrics, and bounce rates to decide your acquisition strategy. 

Let me give you some examples from my former career. Here is the data from SimilarWeb for three websites that we will analyze further:

The first was a relatively new start-up online fashion clothes store, Artik Studio. I compare it to Lamoda and Wildberries, two large online clothing retailers. Notice how the metrics on graphs behave when you analyze a small and large website or pick a large site and compare it to an equally large competitor.

Here are the traffic dynamics for three months. At the bottom are engagement metrics: the number of monthly visits, average visit duration, session depth, and bounce rate.

I don’t advise drawing conclusions based on average numbers — that’s the “average temperature of the hospital.” Instead, I suggest looking for places on the graphs where the data behaves abnormally or contradicts each other. Analyze this specific time frame rather than just looking at the average numbers at the bottom of the screen.

In the above screenshot, I’ve circled it with a red rectangle where the contradiction is observed. Lamoda’s traffic is down, and Wildberries’s is up. To make correct analytical outcomes, readers need to understand that on the CIS market, Wilbberries and Lamoda at those times were probably accountable for at least 80% of all the category traffic.    

When you look at your website’s data in Google Analytics and see a drastic change, you usually realize what happened: a newsletter blast raised traffic, the daily PPC budget was over, and the traffic decreased, or the site went down entirely, and the traffic diminished.

When analyzing competitor data, you do not know if a specific action accounts for a particular metric change. Therefore, you need to be able to hypothesize and test.

If we have a situation like the one in the screenshot above, we can assume several things:

• Lamoda could have a downtime due to a technical issue;
• Wildberries could launch an advertising campaign and pull Lamoda’s traffic;
• Lamoda’s website content has changed: a new assortment was added, prices were changed, or the promotion was applied.

How to use SimilarWeb in conjunction with Wayback Machine?

Checking the first two hypotheses should not be a problem; downtime can be seen in a web counter and recently launched advertising campaigns in Semrush or similar tools. What should we do if we are inclined to believe that traffic has been affected by a change in content? For example, an anomaly fell in the last week of November, now February. We can’t go to a competitor’s website and see November’s content because it has already changed. In this case, I recommend turning to the Wayback Machine:

Here we enter Lamoda’s URL and see a timeline showing a snapshot of the website at a particular time. If you click on the blue or green dots, the website will appear in your browser as it was on that date.

Take it as a rule: if traffic diverges in SimilarWeb, go to the Wayback Machine and research what happened with the website content in those days. The Wayback Machine works like a search engine bot by accessing your website and saving a copy to the database for a historical record. Sometimes, this copy isn’t complete, and sites don’t always display correctly. Still, even partial information is valuable for analysis. Users can also submit web pages to be archived, ensuring that essential or endangered content is preserved for future access. The frequency with which pages are captured varies widely, depending on the website and how often the content changes.

Exploring other metrics in SimilarWeb

Check out the mobile vs desktop traffic distribution:

In 2016 only 30% of the traffic was mobile. In 2024 this will increase to about 60% of users coming from mobile devices.

If more people visit your competitor’s website from desktops, there can be two hypotheses. Firstly, the mobile version is likely a weak point, so try investing in mobile traffic. Secondly, the mobile traffic is not converting, and your competitor focuses on desktops or tablets. The key to understanding is paid traffic; if there is no paid traffic from mobiles, the second hypothesis is likely confirmed. Look at the bounce rates:

The blue and red lines are going up. That’s an increase in bounce rate of about 10-15%. You can make assumptions here. For example, if you see traffic going up along with the bounce rate, your competitors have likely enabled an ad campaign with low-quality traffic.

Look at the distribution of traffic sources by channel:

Above are relative values (in percentages), and below are absolute values (in visitors).

Here you can see your competitors’ traffic sources, paid vs. organic distribution, and the amount of traffic they get from each source. 

Wildberries have much higher brand awareness, which correlates with the level of direct traffic. Users often go through type-in to this website, which is beneficial as this traffic is free and usually high quality. 

You can also click on the names of the traffic sources below the charts and drill down the report for more details. For example, let’s click on search traffic:

Suppose you’re looking for areas where you can cheaply execute a go-to-market strategy in a crowded market. Take a look at the search distribution. In our case, you can see that the two big stores have little traffic from video search. These are growth points where you can pull traffic to your website inexpensively if you take care of your YouTube channel or invest in advertising on YouTube. In addition, all websites have a small share of shopping searches, which can effectively generate orders.

For social media, there is an insight coming out, too. We can see that the most users come from VKontakte:

If we are engaged in SMM or social media advertising, we should determine which platform to invest in. Many companies believe VKontakte has a bigger audience and actively invest there. But it may be better to look at it from a different angle for Artik Studio. 

Lamoda and Wildberries face less competition on Facebook and Instagram; therefore, we can start our activities on these platforms. Surprisingly enough, Facebook has the capability to showcase competitors’ active ad campaigns for free. The tool in question is called Facebook Ad Library, which is entirely free. It does not show anything other than currently active ad campaigns, though, so its capabilities in this regard are relatively limited.

Specific platforms can vary based on particular use cases; however, the logic behind decisions is always the same: find the less crowded channel with less competition and focus efforts on it.

How to estimate competitor conversion rates with SimilarWeb?

Organic and paid landing page reports help estimate your competitors’ conversion rates. Unfortunately, these reports are no longer available in the free version. I will demonstrate a method of rough conversion calculation based on demo data from an example clothes store.  

This legacy SimilarWeb report shows us the percentage of traffic for each page on the website. 

In the fifth position, we notice pgcheckout.aspx, which refers to the beginning of the checkout funnel. We can see that 2.16% of users go through this page. What does this mean? It’s a conversion marker; 2.16% of all website visitors start the order process.

The shopping cart page is third. Thus, 3.11% go to the cart, and 2.16% proceed to the checkout, meaning the conversion rate is 2.16% or less. If the URL slug of each shopping cart step is different, we can estimate conversion rates for each shopping cart step.

The “Sale” section, number 9 in the table, takes half of the traffic of the whole women’s section in row 2. In addition, we can look at sign-in under line 4 and realize that 2.78% of people are logging in to the website, which helps to estimate the loyal audience.

Another helpful feature is the outgoing traffic report, formerly called “Outbound links”. It shows which sites users go to after browsing the analyzed website. I checked Wildberries:

In the fourth place, we see the wbpay.ru website. Browsing it, it becomes clear that Wildberries customers pay for their purchases on this site; it is a payment gate. Here is how we can make a conversion rate estimation using this report:

• 6,59% of all outgoing visitors start the order process on the website, according to the screenshot above;
• The overall number of outgoing visitors in this report is 483,000 visitors per month;
• 483,000 multiplied by 0.0659 equals 31,900 visitors that start navigating to the order process;
• 31,900 divided by 3,412,000 overall visitors (not outgoing visits, but all the traffic for the month) equals 0,9%, which is the estimated conversion rate. 

This way, you can estimate the conversion rate for the websites whose URL slugs are understandable (always look for words like pay, order, checkout, gate, etc, in slugs). 

Other data analysis approaches

Of course, SimilarWeb is not the only marketing solution that can assist with tracking PPC efforts and other parameters of your company or the competition. 

• Keyword Planner from Google offers the ability to see the average cost-per-click and volume of keywords in specific regions.
• Ahrefs provides PPC investment data, best-performing landing pages, and current bids on keywords from specific competitors.
• SEMRush can offer a comprehensive overview of a company’s marketing budgets and advertising strategies, including ad copies, live ads, budget monitoring, and display advertising campaigns.

Tracking organic performance can be slightly more tricky, but there are still multiple approaches to do so, including manual E-A-T tracking, visibility reports, identifying top-performing keywords and pages, and running crawlers.

• Screaming Frog is a crawler that can detect various potential issues that negatively affect the visibility of a webpage in Google’s search results.
• Ahrefs can assist with finding out the highest-performing keywords and pages in terms of traffic to see how the company in question answers a potential customer’s questions.
• Many SEO solutions, such as Moz or Ubersuggest, can perform difficulty score analysis and keyword volume assessment. These are essential tools for determining the current ranking of specific competitors and their interactions with trophy keywords.
• SimilarWeb is an excellent solution for detecting traffic sources, which can be crucial for more extensive and varied domains with multiple traffic channels.
• Mobile performance and general site speed can be checked by Google’s free tools, as well.

Website assessment as a part of the competitor analysis

That’s not to say that resources such as SimilarWeb and others are necessary to gather valuable information about competitors’ marketing efforts. In fact, plenty of meaningful data can be acquired from something as basic as looking at a company’s website. The only skill necessary here is to know what to look for.

Some of the most valuable information that can be gathered from a business’s website includes:

• CTAs that reveal what actions the company wants the customer to take after visiting the website;
• Positioning that reveals the overall position of the company on the market, including its most important benefits, its primary target audience, etc.;
• Resources that can be used as an in-depth explanation of a company’s content strategy if the company itself offers enough information on the topic (webinars, case studies, whitepapers, etc.);
• Messaging that can be summed up to the way the company appeals to its customers, including specific word choices, features that are most focused on, etc.;
• Visual assets that offer a wealth of information in terms of how the company positions itself, its products, as well as its development team.

Of course, this list is far from complete, and plenty of other information sources could be found on a company’s website. If we’re talking about more case-specific metrics, I also want to mention:

• Main topic hubs.
• Navigation pages.
• Gated and non-gated resources.
• The way different web pages link to one another.

Conclusion

The digital marketing landscape goes through plenty of changes on a regular basis while remaining extremely competitive. Being able to not only work with your marketing campaigns but also keep an eye on your competition is a crucial advantage that no modern company can work with. Competent marketers are capable of creating entire promotional campaigns based on in-depth information about the competitors’ weaknesses.

There is an entire market of competitor analysis software, with examples such as SEMRush, SimilarWeb, Screaming Frog, Ahrefs, or even Google’s own Keyword Planner. It is important to remember that simply gathering this kind of information is not useful in itself. A marketer would also have to assess their competitors correctly and be able to interpret the information to receive any kind of useful insights.

When this entire process is performed in a competent fashion, digital marketing competitor analysis is capable of providing a substantial competitive edge to its users. It is a legitimate competitive edge in the right hands, with realistic objectives, better budget allocation, improved traffic channels, and multiple other advantages that result in generally better marketing performance.