It’s natural to watch competitors. What are they doing? What’s working for them? How do they position themselves? These seem like important questions.
And they are—to a point. But competitive analysis has limits that are often overlooked. The most important insights about your business won’t come from studying someone else’s.
The Limits of Competitive Intelligence
You can’t see their results. You can see their website, their campaigns, their features. You can’t see their conversion rates, their profit margins, their customer satisfaction. That fancy feature they launched? You have no idea if it’s working.
You can’t see their strategy. Visible tactics don’t reveal underlying strategy. They might be testing something that will fail. They might be pursuing a segment you don’t want. They might be making mistakes dressed up as innovation.
You can’t see their constraints. Every company operates within constraints—technical, financial, organizational. Their choices reflect their constraints, not optimal solutions. Copying their tactics imports their limitations.
You can’t see their customers. Their customers aren’t your customers. What works for their audience might fail for yours. The resonance that drives their conversion might fall flat with different people.
The Copying Problem
When you copy competitors, you’re making an assumption: that they know something you don’t, and that their situation is similar enough that their solution applies to yours.
Both assumptions are often wrong.
We’ve seen brands implement features because competitors had them, only to discover those features hurt conversion. The competitor had them for legacy reasons, or they were underperforming, or they served a different audience. Copying imported a problem, not a solution.
What Competitors Actually Tell You
Competitive analysis isn’t useless. It’s just limited. Here’s what it can legitimately reveal:
Market standards. What do customers in your category expect? What’s table stakes? This establishes a baseline, not a strategy.
Positioning gaps. Where are competitors clustered? Where is no one positioned? This might reveal opportunities for differentiation.
Feature landscape. What capabilities exist in the market? This informs what customers might expect or compare you against.
Messaging patterns. How do others talk about the category? Understanding common language helps you communicate effectively—whether following conventions or deliberately breaking them.
Where to Look Instead
Your customers. They know what they need, what’s confusing, what would help. No competitor can tell you this. Only your customers can.
Your data. Your analytics reveal what’s actually happening on your site. Not what might work based on what others do—what is working and what isn’t, specifically for you.
Your team. The people who talk to customers daily, who process orders, who handle support—they have insights that no competitive analysis can match.
First principles. Instead of asking “what are competitors doing?”, ask “what does our customer actually need?” The answers might be different.
Differentiation Requires Difference
If you’re always watching competitors and adjusting to match them, you converge toward sameness. Your site looks like their site. Your messaging sounds like their messaging. You compete on price because there’s nothing else to compete on.
The brands that build real advantages do things competitors don’t do—or won’t do, or can’t do. This requires looking inward, not outward. Understanding your unique strengths and your customers’ specific needs.
The Right Balance
Watch competitors lightly. Be aware of what’s happening in your market. But don’t let competitive analysis drive your strategy.
The most important questions—Who are we for? What do they need? How do we uniquely serve them?—can only be answered by looking at yourself and your customers. No competitor can help you there.