How to do market research · 2026 guide · Part 2 of 3
Updated October 2026
Part 1 | Part 2: competitor analysis (you are here) | Part 3
Competitor analysis (also called competitive analysis) means finding out who is competing for your customers, what they offer and how they communicate, so that you can make pricing, positioning and launch decisions based on data. At the end you have a map of the market and a short list of actions.
Our guide to market research has three parts: part 1 covers the basics, part 2 (this one) covers competitor analysis, and part 3 covers your target audience. The framework we first published in 2017 still works, but in the 2026 edition the tools, sources and examples are new.
Want an example straight away? Go to the step-by-step example or the real case study.
In short
- What you do: choose the competitors that matter, compare them on a few key factors and draw your conclusions in a SWOT analysis.
- Where you look: websites, ads, reviews, press, public company data and free Google tools.
- Where desk research (secondary sources) stops: to find out why customers choose one brand or another, you need primary research.
Content part 2
What competitor analysis is and when you need it
Competitor analysis is the stage of a market research study that focuses on the companies competing for your customers; the rest of the study looks at the market as a whole.
A competitor is any company that can take your customers away. Most often it is a firm in the same industry with similar products or services, but not always. Companies compete on price, on the type of product or service, on promotions or on service quality.
Competitor analysis underpins your marketing plan and keeps you up to date with what is happening in the market. You need it when you:
- launch a new product or service;
- enter a new market;
- change your prices;
- prepare your annual strategy.
Direct competitors, indirect competitors and substitutes
- Direct competitors: sell the same thing to the same customer. For a guesthouse, the first competitor is another guesthouse in the area.
- Indirect competitors: meet the same need with a different offer. For the same guesthouse, a hotel or an Airbnb-style rental.
- Substitutes: products of a different kind that can replace your offer. For accommodation, a caravan or a tent.
Why competitor analysis keeps you one step ahead
Competitor analysis shows you risks and opportunities early, so you can adapt your strategy before the market forces you to. In 2026 a few searches are enough to find competitors’ prices, ads and reviews. The advantage comes from how you interpret them.
Whether you do it in-house or with a consulting firm, repeat it periodically. Even if you are launching a completely new product, someone is already meeting the same need. If you have no direct competitors, look at the indirect ones and at substitutes.
Within an organisation, the analysis means different things to different people. A sales representative gets concrete arguments to use in proposals. Management gets information about the marketing strategies competitors use to win market share.
The analysis also helps you choose your positioning and put your marketing budget where competition is weakest.
How to do competitor analysis: two perspectives
You do competitor analysis in five steps: define the industry, identify the competitors, identify the consumers, set the key success factors and score each competitor on each factor (the steps, with an example). Before the steps, keep in mind that you can look at it from two angles: the customer’s and the competitor’s.
From the customer’s perspective
Look at competitors’ products and services the way a customer sees them. Why would customers choose their offer? Does the quality of their products convince people to buy? Start with what their customers say in reviews, then go through the buying experience yourself, as a mystery shopper does (we describe the method below). In the customer’s shoes, you understand better why someone would pick another company’s offer over yours.
From the competitor’s perspective
The other perspective helps you understand the competitors themselves. Put each competitor through the same questions about strengths and weaknesses that you ask about yourself in the SWOT analysis.
The questions to start from
Start from these questions; their answers feed into the SWOT analysis at the end.
Who they are and what they do
- Who are your competitors?
- What are the competitors doing?
- What is standard practice in the market?
- How do customers find them online?
- What do their customers say in reviews?
How strong they are
- What financial results do they publish?
- How aggressive is their promotion strategy?
- How threatening are they to your company’s growth?
What you do
- How do you position yourself against the competition?
- Do the competitors’ strengths or weaknesses overlap with yours?
- How can their strategies affect your business?
For the financial figures of Romanian companies, use the public sources in the risk analysis section.
How to assess competitors in 5 steps
You assess competitors with an evaluation matrix: you score them on the factors that matter to customers. You build it in five steps:
- Define the industry. Establish which industry you compete in and which products and services are sold in the target market.
- Identify the competitors. An industry usually has several. Start with those that serve the same customers as you. How many and what kind of competitors to put on the list is covered below.
- Identify the consumers. Find out who your customers are and what they expect.
- Set the key success factors. Choose the criteria customers use to pick between firms in your industry, for example price, range or delivery.
- Assess your competition. Give each competitor a score on each factor set in the previous step.
The process shows you which competitors matter most in the industry and how to build an effective marketing strategy.
Example: competitor analysis for an online power tools shop
An illustrative example, with invented figures for demonstration. You run an online shop selling power tools (drills, screwdrivers, grinders) and want to know where you stand against the competition.
- Industry: power tools sold online in Romania.
- Competitors: A, a DIY chain with stores and an online shop (direct, large); B, a specialist online shop (direct, niche); C, a marketplace platform (indirect); D, a tool rental service (substitute).
- Consumers: occasional DIYers, who want a good price and fast delivery, and professionals, who want a wide range and support.
- Key factors: price, product range, delivery, customer support, brand awareness.
- Assessment: you score each company from 1 (weak) to 5 (very good) on each factor.
Competitor evaluation matrix
| Company | Price | Product range | Delivery | Customer support | Brand awareness | Average |
|---|---|---|---|---|---|---|
| Your company | 3 | 3 | 4 | 4 | 2 | 3.2 |
| A: DIY chain (direct, large) | 3 | 5 | 3 | 2 | 5 | 3.6 |
| B: specialist online shop (direct, niche) | 4 | 4 | 3 | 4 | 2 | 3.4 |
| C: marketplace (indirect) | 5 | 4 | 4 | 1 | 4 | 3.6 |
| D: tool rental (substitute) | 4 | 1 | 2 | 3 | 1 | 2.2 |
In a real analysis, every score has a source. How to read the matrix: the lightest cells in your own row are where you have ground to make up; the lightest cells in the competitors’ rows are weaknesses you can exploit.
What the example shows: you have ground to make up on brand awareness (2) and range (3), but you do well on delivery and support (4). Chain A (2) and marketplace C (1) are weak on support, so that is where you can differentiate. The decision: invest in visibility and widen the range in the categories where there is demand, instead of entering a price war with the marketplace, which scores 5 on price.
How many competitors should an analysis include?
The number depends on how concentrated the market is. In a concentrated market, where you can easily name all the competitors, you analyse every one of them. Examples: the car market or steel processing.
In other industries the competitors are less obvious, because the product or service can easily be replaced by another. In tourism, accommodation comes in many forms, as the guesthouse example above showed. If you analyse a market like this, start from what tourists choose: our 2017 study on summer holidays captured Romanians’ holiday preferences.
In a market with many competitors, the analysis gets harder but is still doable. There is no point collecting information on all of them, so you focus on one segment of the competition. Our recommended starting point is a short list: a few direct competitors, a few indirect ones, one substitute and one newcomer you keep an eye on. Revisit the list at least once a year, when you review your strategy, because new players keep appearing.
The 80/20 rule
In fragmented markets with many competitors, roughly 80% of the market is served by 20% of the players. You analyse that 20% carefully, because those players set the tone on price and offer. The rule comes from the Pareto principle applied to market shares and is only a guide: check it against the turnover figures in company accounts.
An illustrative example, with invented figures: you sell specialty coffee online and there are more than 40 small roasters on the market. If the rule applies, around eight of them account for most of the sales. Those are the ones you analyse in detail.
Even so, keep an eye on the small players: one of them may arrive with a new technology or an aggressive advertising campaign.
How do you get competitive intelligence?
You get information about competitors from public sources: ads, sales materials, press, websites, reviews and company registers. Unlike industrial espionage, competitor analysis uses only legal sources. These are secondary sources: information already published that anyone can access. Working with them is called desk research.
Look at what your competitors communicate and how. What they promise the public shows which customers they target and what they are betting on. Once you understand their approach, you know how to differentiate yourself and how to improve your products and services. For ongoing monitoring, follow their social media accounts, join their mailing lists and use a tool that alerts you to their press and online mentions.
Advertising
A competitor’s ad can show you prices, promotions and, indirectly, budgets. When you analyse an ad, look at where it appeared, how often it appears, what special offers it has and which benefits it puts first. If it appears in a publication where neither of you has advertised before, the competitor may be trying to reach a new segment.
The major platforms publish ad libraries you can search:
- Google Ads Transparency Center: ads served through Google Ads; search by advertiser or website name and filter by date and location;
- Meta Ad Library: ads on Facebook and Instagram;
- LinkedIn Ad Library: ads you can search by company, payer, keyword, country or date.
Each library shows different information, so check what you can see in each one.
Sales materials and brochures
Leaflets, brochures, PDF presentations and price lists show how a competitor prioritises its products and which features it puts first. Download them from the website or request them as a prospective customer.
Press and job ads
Newspaper and magazine articles are a good source on competitors’ future plans, how they are organised and which new products they are launching. Press releases give you the official announcements. Job ads are one more signal: several open positions for the same role, or in the same city, can point to expansion. Treat them as a hint.
Competitors’ websites
On a competitor’s website you look at four things: history, team, prices and portfolio.
- the history shows how long the firm has been around and its experience in the industry;
- the team shows how qualified the employees are;
- the prices give clues about the pricing policy;
- the portfolio shows the clients who have already worked with the firm.
Also track their product pages and how prices change over time. For the past, the Wayback Machine keeps old snapshots of pages, if the site was archived. Websites show you what is on offer at a given moment and what is standard in a segment.
Reviews and social media
Reviews show you what customers say about competitors. Read the reviews on Google Maps, in marketplaces and in app stores, plus the public comments on social media. Social listening means systematically tracking what is said publicly about a brand. Look for patterns: what customers praise and what they repeatedly complain about. Note only the themes: you do not need the personal data of the people who wrote the reviews.
Research with free Google tools
A good part of competitor analysis starts with a Google search. With it you can find information about competitors, about how crowded the market is, and about existing supply and demand.
Micro-moments: where customers look for you
To win a customer, you have to appear exactly when and where they look for you. Micro-moments are the times when someone picks up their phone to find out something, find a place or buy: “tool shop open now”, “how to choose a drill”. Search for these phrases yourself and note which competitors appear first: they are the ones taking your customer at that moment.
What problem does the customer want to solve? (jobs-to-be-done)
Customers do not always search for the product name: they search for a solution to a problem.
An entrepreneur who sells drills will be tempted to think that the people visiting the shop are the ones who searched for the word “drill”. They will probably be surprised to find that their customers also include people who searched for “how to put up a shelf”.
In marketing, the idea that people buy a product to get a certain job done is called jobs-to-be-done. If you know the words consumers use when they search, you adapt better to market demand.
Keywords and Google Trends
The results of a search show you how crowded a segment is and what interests customers. For more precise data:
- Keyword Planner is part of Google Ads: you see estimated monthly searches and how much you would have to bid to appear near the top of the page for a keyword. You need a fully set up Google Ads account, including billing details. The estimates are indicative.
- Google Trends shows interest in a topic over time, on a scale from 0 to 100. You can compare your brand name with your competitors’.
- Google Search Console shows data only for websites you own, so it cannot tell you anything about competitors’ sites.
What free tools do not tell you
Free tools show you what competitors say and what people search for. They do not tell you why customers choose one brand over another. For that you need primary research, covered below. Before you get there, two more desk research tools help: AI assistants and public company data, which shows how stable your competitors are.
How to use AI in competitor analysis (and where it can mislead you)
AI assistants (ChatGPT, Gemini, Claude and others) can speed up desk research. Think of an assistant as a fast intern: it gives you a first draft, and you verify every statement.
Where it helps
- It summarises websites, brochures and reviews that you paste into the conversation.
- It groups customer comments by theme: delivery, price, support.
- It suggests a first list of competitors, which you then check in Google, in the press and in the trade register.
- It translates websites and materials from other languages.
Where it can mislead you
- It can invent companies, figures and prices and state them confidently. Researchers call this “hallucination”: text that sounds convincing but has no basis in a source (Ji et al., Survey of Hallucination in Natural Language Generation).
- It may use outdated information without warning you.
- Its answers tend to lean on what has been written about most, which means the big brands. The small competitor in your niche may be missing from the list.
- Data you paste into a public tool leaves the company. Do not enter customer lists, price quotes, contracts or personal data.
The working rule
Every statement in your analysis gets a link that you opened yourself. This also applies when the AI cites sources: the link may be missing or may not say what is claimed. Ask for the source, open it, read the passage.
Try asking, for example: “Summarise in five points what these three websites promise, and flag what cannot be proven from the pasted text.”
If you are tempted to buy an AI-based service, ESOMAR publishes 20 questions to ask the provider before you sign.
Risk analysis: how stable are your competitors?
Your competitors are exposed to risks like any other market player, and competitor analysis assesses those too. That way you see their vulnerabilities and which players are likely to leave the market soon, and their mistakes show you what to avoid.
Financial and legal problems damage a company’s image and credibility, and a competitor’s weakness can give you an advantage.
Risk analysis helps you anticipate. If you know the risks your competitors face, you negotiate more effectively and understand market dynamics better. The same analysis helps you choose partners: by checking their finances and debts, you find out whether you can rely on them.
How to check a competitor’s risks
Most of the time, company information is public, but it has to be gathered and interpreted to be useful. To check a company, you look at four things: the trend in turnover and profit over several years, debts, lawsuits and any insolvency proceedings. Sources you can open:
- National Trade Register Office (ONRC): how the company has developed from registration to today.
- Ministry of Finance (in Romanian): the balance sheets of the last six years for companies, searched by tax ID (CUI). Check on the portal which data is visible without an account.
- Courts portal (in Romanian): the cases in which a company appears as a party.
- Insolvency Proceedings Bulletin (in Romanian): documents published in insolvency proceedings. Some services of the bulletin are paid.
- Commercial platforms that gather the data into customisable reports, for example Risco or Creditinfo (in Romanian).
Data about a PFA (a sole trader in Romania) can be personal data. Consult it only for a legitimate business purpose, such as assessing a partner, and do not use it for anything else.
A real example: competitor analysis of the pawn and currency exchange market
From the same public data you can build a map of competition across an entire market, as in the case below.
The challenge. Since 2020, BSG Amanet & Exchange has commissioned an annual market audit from us, to see, based on objective data, where it stands against the other pawnbroking and currency exchange operators.
What we did. We started from public data (the Ministry of Finance and the National Trade Register Office) and included every operator with these activities, by CAEN activity code. We identified the main players by turnover, profit, average number of employees and number of branches.
The outcome. The analysis confirmed the client’s dominant position. Its strengths went into its positioning strategy and promotional messages. You can read the full case study.
Primary research: see competitors through your customers’ eyes
With the sources so far, you have done desk research. Primary research starts here: data you collect directly from the market, either through evaluators who buy like customers or by asking customers questions. Three methods follow.
Mystery shopping: buy like a customer and compare
Mystery shopping means buying like an ordinary customer and noting what happens. Use the same scenario and the same questions with every competitor, then compare the process, response time, price offered and tone. The evaluator asks only the questions any customer would ask and does not try to obtain confidential information. If you record conversations, comply with data protection rules (GDPR).
MKOR applies the method to competitor analysis as well, through its mystery shopping service. You can read about the method and the sectors where it is used in the article Mystery Shopping: Measure If Brand Promises Are Delivered.
Agile Brand Tracking: how you stand against competitors over time
Agile Brand Tracking is a repeated measurement of your brand against those of your competitors. It tracks awareness, usage, preference and Net Promoter Score (NPS: how likely a customer is to recommend you). A single survey gives you a snapshot. Repeated, it shows you the direction you are heading in. Details are on the Agile Brand Tracking service page.
Surveys and focus groups: why customers choose one brand or another
A survey measures how many customers prefer a brand, how many have switched supplier and which criteria matter most in their choice. You can run it online (CAWI) on a panel, or by phone (CATI). The MKOR online panel has more than 110,000 members.
A focus group explains the reasons: a moderated discussion with 6 to 10 participants about attitudes and perceptions.
You usually start with the focus group, to find out what is worth asking, and then check how widespread the answers are with a survey.
SWOT analysis: the conclusion of competitor analysis
| Helpful (positive) | Harmful (negative) | |
|---|---|---|
| Internal (inside the company) | Strengths | Weaknesses |
| External (in the market) | Opportunities | Threats |
A SWOT analysis sorts the answers to your starting questions into four quadrants, and that summary is where competitor analysis ends. The name comes from the initials of Strengths and Weaknesses, which are internal to the company, and Opportunities and Threats, which are external.
Businesses that have been operating for some time can use SWOT analysis regularly, to see what has changed in the market and react early. The strategy review we recommend every year should include a SWOT analysis.
Start-ups and businesses at an early stage can use it in planning. There is no single recipe for SWOT analysis, and every company has different needs. We know this from working with companies preparing a launch.
Strengths: positive internal factors
Strengths are tangible or intangible characteristics, internal to your company, that you can control. Use these questions as a guide:
- What do you do well?
- What internal resources do you have? Think of the positive characteristics of your employees, such as their training and skills, or the company’s advantages, such as capital, the technology used and an established customer base.
- What advantages do you have over the competition?
- Do you have extra capacity for growth or production?
Weaknesses: negative internal factors
Weaknesses are the aspects that reduce the value you offer on the market and put you at a competitive disadvantage. You need to correct them to compete.
- What should be improved to reach your goals and compete with your strongest competitor?
- Does your business have limited resources?
- What is your business missing to thrive (expertise, technology, trained people)?
- Which controllable factors are holding you back?
Opportunities: positive external factors
Opportunities are external factors that can bring you growth. The first step is to identify them, the second is to take advantage of them. Useful questions:
- What opportunities exist in the market that you can take advantage of?
- How is your business perceived in the market?
- Has the market grown recently, or have changes appeared that create new opportunities?
- How often do opportunities arise in the market?
Threats: negative external factors
Threats are external factors that you cannot control and that may affect your strategy or even your business. Identifying them early tells you how to react.
- What challenges can you identify in the market that pose risks to your business?
- Have raw materials become more expensive, or are suppliers running out of them?
- Have new regulations appeared that directly affect your company’s activity?
- Which technologies have a direct impact on your industry?
- Have new players entered the market, especially online?
- Are customers searching differently (marketplaces, comparison sites, AI assistants)?
A completed SWOT example
An illustrative example: the same online power tools shop from the 5-step example. The data is invented for demonstration.
| Quadrant | Example |
|---|---|
| Strengths | Customer support better than chain A and marketplace C. Good delivery: 4 out of 5, the same as marketplace C and above chain A. |
| Weaknesses | Low brand awareness compared with A and C. Narrower range than A, B and C. |
| Opportunities | A and C are weak on support: you can differentiate through advice on choosing the right tool. Customers look for buying guides and comparisons before they buy. |
| Threats | Marketplace C wins on price, and a new online entrant could push prices lower still. Substitute D (tool rental) takes the customers who need a tool only once. |
Formulate recommendations
For each combination of quadrants (for example, strengths with opportunities), write a strategy and a few recommendations. The table below, known as the TOWS matrix, helps you do this.
| Factors | Opportunities (external, positive) | Threats (external, negative) |
|---|---|---|
| Strengths (internal, positive) | Recommendation: maximise your strengths. How can you use your strengths to take advantage of the opportunities you identified? | Recommendation: avoid or reduce the threats. How can you use your strengths to avoid the threats you identified? |
| Weaknesses (internal, negative) | Recommendation: reduce your weaknesses. What can you do to reduce your weaknesses by taking advantage of the opportunities you identified? | Recommendation: change what you can control. How can you change your internal weaknesses so as to minimise the impact of external threats? |
In the power tools example, combining strengths with opportunities points to one strategy: offer expert advice on choosing the right tool, where A and C are weak. Combining weaknesses with threats leads to the same decision as the evaluation matrix, now backed by the SWOT: widen the range and increase visibility, because on price marketplace C already has the top score.
From analysis to decision: the one-page summary
An analysis that stays in a folder changes nothing. For it to reach the person who decides, condense it into a single page.
The one-page template
| Field | What you write |
|---|---|
| The decision to make | A question the manager answers with yes or no, or by choosing between options. For example: “Do we extend the range with professional tools or not?” (illustrative example) |
| The 3 findings | The three most important things you learned, each with its source. |
| The recommendation | What you propose and which actions follow, in one or two sentences. |
| Who and by when | One owner for each action and a deadline. |
| What you review and when | The data that may change and the moment you check it again. |
For the last field, use the same cycle as the SWOT review: once a year, or more often in a fast-moving market.
Five common mistakes
- You copy only the market leader, although you have different resources and different customers.
- You look only at price, although customers also choose on delivery, support and trust.
- You ignore indirect competitors and substitutes.
- You use figures without a source and without the date they were collected.
- You finish the analysis without a decision.
Competitor analysis FAQ
How do you do a competitor analysis in market research, step by step?
You go through five steps: define the industry, identify the competitors, identify the consumers, set the key success factors and score the competitors on those factors. For each factor you give every competitor a score from 1 to 5 and compare the averages. At the end you sum everything up in a SWOT analysis and a decision. The full example is in the section on the 5 steps.
How many competitors should I analyse?
We recommend a short list: a few direct competitors, a few indirect ones, one substitute and one newcomer you keep an eye on. In a concentrated market, such as the car market, you can analyse every player. In a fragmented one, such as accommodation, you pick a segment and analyse its biggest players.
What free tools can I use for competitor analysis?
Start with Google: simple searches and Google Trends, where you compare interest in your brand with interest in your competitors’ brands. Add the ad libraries (Google Ads Transparency Center, Meta Ad Library, LinkedIn Ad Library), reviews on Google Maps and competitors’ websites.
What is mystery shopping and how does it help with competitor analysis?
Mystery shopping means an evaluator buys like an ordinary customer, following a fixed scenario. Applied to competitors, it shows you the experience they actually deliver: how long the reply takes, what price you are quoted, how the customer is treated. You compare the results with your own. More on the mystery shopping page.
Can I use ChatGPT or another AI for competitor analysis?
Yes, for a first draft: summaries, grouping reviews by theme, a first list of competitors. The decision itself should rest on sources you have checked. AI assistants can invent companies, figures and prices, so every statement has to be confirmed in a source that you opened yourself. Do not give them confidential or personal data.
How much does a competitor analysis by an agency cost, and how long does it take?
Price and duration both depend on the number of competitors, the methods chosen (desk research, mystery shopping, survey, focus group) and the market, so we do not give general figures. You can see how a price is built on the pricing page, or request a quote on the competitive analysis service page.
Sample studies: real examples
On our published research page you can download recent MKOR studies for free, to see what a report looks like and which questions were asked. For competitor analysis and new markets, three cases are especially relevant:
- Competitive Analysis of the Romanian Pawn and Exchange Market: an annual audit based on public data, described above.
- Equipment Services Market Entry Study: how an international industrial group sized the market and made its entry decision.
- Concept testing for a legal-tech platform: a quantitative survey before launch.
Do you need specialist help?
Since 2012, MKOR Consulting has offered market research and strategic consulting: competitor analysis, market research studies, mystery shopping, Agile Brand Tracking, customer satisfaction studies, target audience segmentation, customer profiling and opportunity studies for new markets.
See what clients say about the results the team delivers.
Want competitor analysis done by specialists? We choose the right methods for your market and deliver conclusions you can base decisions on.
Request a quote · See an example
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Next: part 3, target audience analysis
The third part of the guide moves from competitors to customers: target audience analysis, the purchase decision process and its stages, consumer analysis, the consumer profile, plus conclusions and recommendations.
