Knowing who you are competing with is the first step in gathering competitive intelligence. Competitors come in all shapes and sizes. Some sell the same exact product and service you sell, and others sell a different solution to the same problem your offering solves. Sometimes your competitors are just competing for wallet share of your prospects, and are not even direct competitors, and sometimes your competitors are competing for your prospects attention.

For example, lets say you are selling an investment product, like ETrade. In order to reach wealthy investors, you need to advertise to them through websites like The Wall Street Journal, and other financial news sites and blogs. You need to look at who else is advertising to your audience, because that will have a big impact on the cost to reach your audience. If a private jet broker is competing with you for your prospects attention, and they stand to make thousands of dollars off each customer, and you only make hundreds, it will be hard to compete with them when it comes to buying media.

So, your competitors are anyone trying to reach your prospects, especially when they are in the frame of mind of solving the problem you solve for them. You need to stay on top of all of them because that knowledge will let you build off their successes and avoid their mistakes.

The first place to find out who your competitors are is to search search engines for your category name (i.e. Zappos=Shoes) and major keywords (i.e. mens shoes, sneakers, boots,etc...) and see who is advertising. I say advertising over who is ranking organically because whoever is advertising is telling you, "Hey, I am willing to spend money to reach this prospect."

The next step is to find a few websites, preferably content websites that reach your audience and see who is advertising to reach that audience.

Now you have a pretty good list of your main competitors... you can of course build out a bigger list as time goes on, and use tools like KeywordSpy to see who else is advertising on these keywords, but for starters you want to start with your main competitors and build out from there.

Happy Hunting.