Direct vs. Indirect Competitor: Everything You Need to Know

You might think your biggest competitor is the startup next door selling the same thing you do. But in the world of paid advertising, the story is never that simple.

Let’s say you’re running Facebook ads for your new fitness app. You’re bidding against other fitness apps, sure. But you’re also competing with Nike’s sneaker drops, Peloton’s lifestyle reels, and even that mouthwatering burger ad from McDonald’s. These brands aren’t in your category but they’re still pulling attention (and dollars) away from your ad.

This is what marketers call indirect competition. And, in the age of short attention spans and saturated feeds, ignoring it can quietly tank your clickthroughs, skyrocket your CPMs (Cost Per Mille), and sabotage your CAC (Customer Acquisition Cost) without warning.

In this guide, we’ll unpack:

• What direct and indirect competitors actually are (with clear examples)
• How indirect competitors show up in your paid ad campaigns
• Why tracking them is essential if you want to win more than just impressions
• Real examples from brands like Nike, Netflix, and Coca-Cola
• How to find, analyze, and outmaneuver indirect competition with smarter ad strategy

Whether you’re a startup founder launching your first ad campaign or a solopreneur trying to stretch a small budget, this blog will help you see the full competitive landscape. So you’re not optimizing in a vacuum.

Let’s start by redefining what it means to have a competitor in paid media.

What is a competitor in paid marketing?

Most people think of competitors as companies selling the same product or service. And sure, that’s part of the picture. But in paid advertising, your competitors aren’t just who’s in your industry. They’re whoever’s standing between your ad and your customer’s next click.

In other words: you're not just competing for purchases. You're competing for attention and conversion.

That means your “competitors” could include:

• A TikTok dance challenge that pulls your target audience away from Instagram
• A Shopify brand selling a totally different product with the same audience targeting
• A Google Search ad from a blog post with an irresistible lead magnet
• Or even Netflix, if your product requires time and mental focus

This is what we mean when we talk about competition from an attention and conversion lens i.e., looking at competitors based on what captures your audience’s attention and drives them to act — not just those in your product category.

When you understand competition this way, you start to realize why some campaigns underperform despite strong copy and targeting. It’s often not about your ad, it’s about what else is in the feed, the search result, or the mental space of your audience when your ad shows up.

So before we dive deeper into indirect competitors, let’s look at the two types of competition that matter most in paid media: direct vs indirect and why knowing the difference can change how you approach ads entirely.

Direct vs. indirect competitors in ads: key differences

In paid advertising, not all competitors are created equal. Some brands go head-to-head with you in the same category. Others sneak in through the side door, grabbing your audience’s attention with a totally different product that solves the same problem, or just satisfies the same craving.

That’s the difference between direct and indirect competitors.

Let’s break it down:

If you’re running Google Ads for your DTC skincare brand, your direct competitors might be other clean beauty startups bidding on the same keywords. But your indirect competitors? They might be wellness apps, sleep aid products, or even influencers pushing holistic health routines — all competing for the same outcome your product promises.

This matters because while direct competitors are easy to spot in your dashboards and auction insights, indirect competitors are invisible but no less deadly. They increase your CPMs, steal clicks, and shape your customer’s expectations without ever bidding on your keywords.

In short: if your ads aren’t converting and your direct competition isn’t doing anything special, it might be time to look sideways.

What is an indirect competitor in paid advertising?

An indirect competitor is a brand that solves the same customer need as you. But it does through a different product, category, or experience. And in paid advertising, that means they often compete with you without ever mentioning your brand, your industry, or your keywords.

Here’s a working definition you can borrow:

An indirect competitor in paid ads is any brand or product that satisfies the same underlying customer desire and competes for attention, time, or wallet share — even if they’re in a completely different category.

Let’s make it realistic with some examples:

These brands don’t always bid on the same keywords. They might not even show up in your category. But they absolutely influence your ad performance. They shift what customers expect, how they spend their money, and what they pay attention to in the 2.3 seconds it takes them to scroll past (or stop on) your ad.

Indirect competitors are sneaky like that. They don’t show up in your Auction Insights or campaign dashboards. But they affect your CTR (Click-through Rate), your CAC, and your ROAS (Return on Ad Spend) just the same.

Real-world indirect competitor examples in paid ads

Let’s bring this to life with real brands. Below are examples of how indirect competitors show up in paid ad environments across B2C, B2B software, and DTC brands. You’ll notice a common thread: they don’t sell the same thing, but they compete for the same moment, attention span, or underlying need.

1. Netflix

• Direct competitors: Disney+, Hulu, Amazon Prime Video
• Indirect competitors: TikTok, YouTube, mobile games
• How it plays out: On Meta and YouTube, Netflix competes not just with other streaming platforms, but with bite-sized content that delivers instant dopamine. Netflix might buy a carousel spot promoting a new series but if someone gets hooked on TikTok first, the ad gets ignored. That’s lost watch time and wasted spend.

2. Nike

• Direct competitors: Adidas, Puma, New Balance
• Indirect competitors: Apple Watch, Peloton, fitness influencers, Lululemon
• How it plays out: Suppose, Nike’s ad is promoting new running shoes appears on Instagram Stories. At the same time, a Peloton instructor is promoting a free trial, and Apple is showcasing a fitness-focused smartwatch. Different products, but same lifestyle goal: “get fit.” They’re competing for the same desire, not the same SKU (Stock Keeping Unit).

3. Notion

• Direct competitors: Coda, ClickUp, Evernote
• Indirect competitors: Google Docs, paper notebooks, Slack channels, Trello boards
• How it plays out: Notion might run search ads targeting “project management tool,” but a founder might click on a blog post titled “10 free Google Docs templates” instead. Or opt to jot things down in Apple Notes. Different category, but same job to be done.

4. Canva

• Direct competitors: Adobe Express, VistaCreate
• Indirect competitors: Fiverr designers, Instagram Reels templates, pre-made website themes
• How it plays out: Suppose Canva’s Google Display ad offering DIY design gets ignored because the user just bookmarked a freelancer’s $15 logo gig on Fiverr. The design gets solved but just not by Canva.

5. Ritual

• Direct competitors: Care/of, HUM Nutrition, Seed
• Indirect competitors: Smoothie subscriptions, sleep-tracking apps, gym memberships, TikTok wellness trends
• How it plays out: Suppose Ritual is running a well-crafted ad campaign about clean ingredients and gut health. But that same customer might choose to subscribe to a smoothie brand instead or spend their budget on a guided meditation app they just saw in another story ad.

These examples show that indirect competitors live outside your category but inside your customer’s head. They don’t always show up in the same search result or Facebook carousel, but they do fight for the same goal, same emotion, or same wallet.

And if you're not accounting for them in your ad strategy, they’ll quietly siphon off your conversions.

How to identify your indirect competitors in paid campaigns

Indirect competitors won’t show up in your keyword planner, ad auction reports, or competitive dashboards. Rather, they operate in the background, behind the curtains.

To truly understand who you’re up against in the ad landscape, you need to step outside traditional category thinking. Here’s a step-by-step approach to uncover your real indirect competition and why each step is crucial if you want to build ads that actually convert.

1. Start with the “job to be done”, not the product you sell

Most founders look at competitors based on features or industry. But customers don’t care about your category, they care about solving their problem.

So instead of asking, “Who else sells what I sell?”, ask:

“What outcome is my customer trying to achieve, and what else could help them get there?”

This is called the Jobs to Be Done (JTBD) framework. It helps you see competitors not as companies that look like yours but as anything that can fulfill the same functional or emotional need.

Indirect competitors often solve the same job in a totally different way. If your ad doesn’t speak directly to the job your customer cares about, it won’t win attention no matter how “relevant” the audience targeting seems.

Example:

Let’s say you run ads for a focus-enhancing supplement.

• The job your customer is hiring the product for? → “I want to feel sharp and productive.”
• Other ways they can solve that job:
  • Downloading a meditation app
  • Buying an ergonomic desk setup
  • Drinking more coffee
  • Watching productivity hacks on YouTube

Now your real ad competition isn’t just other supplements. It’s the entire universe of products and content that promises to boost mental clarity.

2. Map your audience’s attention path

You already think about your customer’s buying journey. But in paid advertising, the journey that really matters is the attention journey: what your audience is seeing, reading, scrolling through, or watching before, during, and after they see your ad.

Ask yourself:

• What’s showing up in their feed right before my ad?
• What apps or platforms are pulling them away from search or social?
• What kind of content are they actively engaging with when my ad goes live?

Ads don’t exist in a vacuum. A brilliantly crafted Facebook ad can underperform simply because your audience is already mentally occupied by a lifestyle Reel, a viral meme, or a competitor solving the same need in a flashier way. That’s why focusing on the attention path is more important than focusing on purchase path.

Here’s how to find this out:

• Use Meta Ad Library, TikTok Creative Center, or Pinterest Trends to see what other brands are running ads to your audience.
• Search Reddit or Quora for posts like: “Alternatives to [product],” or “What helped you with [problem]?”
• Use tools like SparkToro to analyze what your audience reads, listens to, and follows—outside your niche.

3. Talk to your users and ask this specific question

“What else did you consider — before or instead of buying this?”

Customer interviews are a goldmine for competitive insights. But most founders only ask about why someone chose them. Instead, ask the question above and encourage them to be honest. Many people will mention things that aren’t even in your space e.g. content, creators, habits, or other tools they thought might solve the same problem.

This surfaces real-world indirect competition that tools like SEMrush, Google Ads, or Meta can’t detect. It also shows you which options are top-of-mind before someone even searches for a product like yours.

How to do it:

• Add this question to your post-purchase survey or onboarding flow
• Include it in your sales calls or customer success check-ins
• Ask people who didn’t convert too. Ask what stole their attention or seemed like a better use of their time or money?

Once done, document the answers and tag them as:

• Direct competitors (same product category)
• Indirect competitors (different solution, same job)
• Attention competitors (not solving the job, but stealing focus)

4. Use search trends to track rising alternatives

Some indirect competitors don’t exist yet in your ad data because they’re new. But your audience might already be drifting toward them. Use Google Trends to monitor how interest shifts across solutions to the same problem.

Here’s how you can do it:

• Start with your core product keyword (e.g. “project management software”)
• Then compare it against alternative terms that could serve the same job:
  • “Notion templates”
  • “Time blocking app”
  • “AI meeting notes”

Watch for rising terms that spike in popularity while your ads stall.

This matters because you don’t want to be the last brand to realize that a content creator, Chrome extension, or new app has started eating into your funnel before they even become a line item in your performance report.

5. Run audience experiments to surface hidden overlaps

Still unsure who your indirect competitors are? Test it directly by running A/B test with ads on Facebook or TikTok:

• One targeting your traditional audience (e.g., “CRM software buyers”)
• One targeting audiences who follow or use alternative tools (e.g., “Notion,” “Slack,” “Google Sheets”)

Use the same creative, then compare:

• CPMs
• CTRs
• Add-to-carts or sign-ups

This tells you where interest and intent might be shifting. If the “alternative audience” performs just as well. Or better, you’ve discovered a new pool of competitors (and likely, new positioning opportunities).

Why indirect competitors matter in paid strategy?

If you’re running paid ads and things just aren’t clicking i.e., your CTRs are dropping, your CAC is creeping up, and performance feels off despite good creative, there’s a solid chance your problem isn’t just weak copy or poor targeting.

It’s competition. But not the kind you’re probably watching.

The most dangerous competitors in paid media today are the ones operating quietly in the background. They influence your customer’s expectations, absorb their attention, and nudge them to choose a different solution before they even think of yours. These are indirect competitors, and they matter far more than most startups realize.

Here’s why indirect competitors matter in paid marketing:

1. They increase your CPMs without bidding against you

First, let’s talk about cost. Even if an indirect competitor isn’t bidding on the same keywords or targeting the same interest groups, they can still drive up your CPM. Why? Because ad platforms like Meta, TikTok, and YouTube reward what holds attention.

If your ad enters a feed already saturated with highly engaging content that solves the same underlying need — say, a wellness app running a slick campaign about productivity — then your ad will perform worse by comparison. The platform sees your ad as lower quality, your relevance score dips, and your cost to reach the same audience quietly increases. While you’re not technically competing head-to-head, you’re still paying for the fallout.

For example: your mental health journaling app might get crushed in the feed because your audience just liked a Reel from a wellness creator promoting meditation affirmations. Different solution but same emotional job. And your ad loses.

2. They shape customer expectations before your ad even shows up

Beyond cost, indirect competitors subtly reshape what your audience expects from a solution long before your ad even appears.

Imagine someone browsing TikTok for stress relief tips. They stumble upon a viral video featuring a five-minute breathwork routine. It's free, immediate, and emotionally resonant. An hour later, they see your Facebook ad promoting a month-long guided meditation app. It’s beautifully designed, the value is clear, but now it feels heavy. That fast, frictionless option they just experienced has recalibrated their standard.

Your offer didn’t get worse but it just got compared to something that felt easier. And that changed everything.

3. They steal conversions at the last mile

Then there’s the matter of conversions. Just because someone clicks on your ad doesn’t mean you’ve won. Conversion is a battleground where indirect competitors are particularly sneaky.

A user might hit your landing page, love what they see, and still walk away. Not because your offer was weak, but because something else: another app, a familiar brand, a viral post pulled them away at the last second.

Maybe they remembered a free YouTube video they saved. Maybe they opened Slack and got buried in messages. Maybe a meal kit ad popped up and reminded them to spend their money elsewhere. These aren’t direct attacks but they’re conversion killers all the same.

4. They blur category boundaries and make targeting less predictable

What makes it even more complex is that indirect competition blurs the boundaries of your category. A design tool like Canva doesn’t just compete with Adobe Express. It competes with Fiverr, Instagram templates, and even AI-generated logos. A fitness brand like Nike isn’t just watching Adidas. It’s contending with wellness influencers, smartwatch makers, and lifestyle apps that compete on identity, not apparel.

As a result, relying solely on category-based competitor research can leave you flying blind. You’ll think your positioning is strong because you’re differentiated from other players in your vertical. Meanwhile, your real threats are coming from outside the lines.

But here’s the good news: once you start accounting for indirect competitors, your ad strategy gets a lot stronger. Your messaging becomes more resonant because you’re framing your product against what your audience is actually thinking about but not just what your category defines as competition.

So yes, indirect competitors matter. A lot more than your ad reports suggest.

How to monitor and analyze indirect competitors in your ad strategy

Once you’ve identified who your indirect competitors are, the next step is keeping an eye on them. Not because you want to copy them but because you need to understand the environment your ads are competing in.

Here’s how to build a simple but powerful system to monitor and analyze indirect competition across platforms and customer behavior.

1. Use ad libraries to track what’s live in your audience’s feed

Start by regularly checking these tools:

• Meta Ads Library: Search by keywords, competitors (both direct and indirect), or categories. Look for the tone, messaging, and offers they’re pushing.
• TikTok Creative Center: See what’s trending in your audience’s country, niche, or demographic. You can filter by industry, CTA type, or ad format.

What to look for:

• Recurring hooks or emotional angles (e.g., “feel calm fast,” “take control of your day”)
• Visual trends or formats (lo-fi testimonials, skits, carousels)
• Value props they emphasize (speed, savings, convenience)

These show you what narratives your audience is being primed to respond to even if they’re not from your competitors directly.

2. Observe what your audience is engaging with outside of ads

Indirect competitors aren’t just running ads — they’re also dominating organic attention. So step into the spaces your audience hangs out.

Explore:

• Subreddits (e.g., r/startups, r/femalefashionadvice, r/xxfitness)
• Facebook or Discord groups related to your category
• YouTube comment sections on creator videos related to your product’s outcome

What to dig for:

• Posts or threads about alternatives or lifestyle habits ("What helps you focus?", "Best budget self-care products?")
• Recurring brand mentions you’ve never heard of
• Non-product solutions people are hyping up (apps, influencers, routines)

These sources will reveal how your audience talks about their needs and the solutions they trust.

3. Track content creators who influence your category

Sometimes your indirect competitor is a person.

If a creator with a large following keeps recommending a “5-minute hack” that solves the same job your product does in a more complex way, they’ve just shifted audience expectations.

Here’s how to monitor this:

• Follow creators on TikTok, Instagram, and YouTube Shorts who talk about your core outcome (e.g., productivity, skincare, wellness, startup tools)
• Use tools like Feedly and Mention to track new content on those themes
• Save the best-performing content and analyze:
  • What emotion it taps into
  • What solution it implies
  • What kind of friction (or lack thereof) it highlights

Creators influence customer perception long before the ad auction starts.

4. Mine competitive insights from customer conversations

Do you know what the most overlooked data sources? Your own users.

Every time someone signs up, churns, replies to an email, or chats with support, they’re leaving clues about what else they considered.

Make the following a part of your feedback loop:

• Ask in onboarding or post-purchase: “What else did you try or consider before finding us?”
• Tag responses in a Notion or Airtable tracker
• Log brand mentions under:
  • Direct competitors
  • Indirect competitors
  • Alternatives that aren’t even products (e.g., “I was just watching YouTube videos instead”)

Over time, this qualitative data reveals the true competitive landscape i.e., what your customers believe works before they decide to pay for it.

5. Spot trends using public interest signals

You don’t need a trend forecaster. You just need curiosity and a few free tools.

Use tools like:

• Google Trends: Compare your product’s keyword with alternative ways of solving the same need
• AnswerThePublic: Look at how people are phrasing problems, not just searching for solutions
• Exploding Topics: Discover early-stage product categories or behaviors gaining traction in your space

For example, if you sell a journaling app and notice that “gratitude videos” or “AI therapy bots” are trending, those will be indirect competitors. They're shaping what your customers think is effective, desirable, or worth trying instead of your product.

Indirect competitors aren’t static. They evolve with trends, platforms, and customer behavior. The key is to treat them as part of your ongoing creative and strategic process.

Keep your ears to the ground, revisit your list of alternatives monthly, and train your team to think outside the obvious category boxes. When you understand what else your audience is choosing or even just considering, you’ll build ads that resonate more deeply and perform more consistently.

How to respond to indirect competitors with smarter paid ad strategy

Once you’ve identified who your indirect competitors are and what messages they’re putting into your audience’s mind, it’s time to adapt. Because here’s the thing: the goal isn’t to beat them at their own game — it’s to play a different game that’s more emotionally relevant, better timed, and more clearly positioned for your ideal customer.

Let’s walk through how to do that, step by step.

1. Reposition around the real job your product solves

Indirect competitors exist because people have options. The question isn’t “Why should someone buy your product?” It’s “Why should they solve this problem with you and not with something quicker, cheaper, or trendier?”

That means your ad messaging should focus on the deeper outcome your customer wants.

If you're running ads for a project management tool, don’t just talk about features. Talk about feeling organized, finishing things on time, or being less stressed during team standups. These are the emotional jobs that tools like Notion, Slack, and even Google Sheets are already fulfilling in your audience’s eyes.

When you align your creative around the job but not the tool, you become harder to replace.

2. Use contrast to position against indirect threats

Your audience may not even realize they’re considering indirect alternatives until you help them see the difference.

Use your ad copy, visuals, or landing pages to create subtle but powerful contrast:

• “Unlike templates or tutorials, [Product] gives you a personalized system”
• “Most tools show you what to do. We help you actually get it done.”
• “Tired of ‘one-size-fits-all’ fixes? This is built for real people with real challenges.”

These kinds of statements don’t bash competitors directly. Instead, they reframe expectations and steer your audience toward a more intentional solution—yours.

3. Double down on emotional relevance in your creative

Indirect competitors often win because they feel more accessible, fun, or emotionally satisfying. They entertain, they simplify, they comfort.

You can’t fight that with a cold product tour. You need creative that taps into:

• The frustration your audience feels with DIY alternatives
• The relief they’ll get from a structured solution
• The identity they want to embody (calm, productive, confident, in control)

This might look like UGC (User Generated Content)-style testimonials, lo-fi “day in the life” ads, or motion graphics that visualize transformation.

If an AI tool or wellness creator is winning because their content is fast and personal, your brand has to feel human and outcome-driven, not just functional.

4. Build urgency without gimmicks

Indirect competitors thrive on immediacy. A YouTube video can be watched now. A free template can be used tonight. If your product requires more investment such as time, money, and onboarding, you’ll need to make the value of that commitment feel worth it.

You can do this by:

• Showing quick wins upfront (e.g., “Start seeing results in your first 7 days”)
• Highlighting opportunity cost (e.g., “How many hours are you losing to context switching?”)
• Framing time-saving or sanity-saving outcomes (e.g., “Reclaim 5 hours this week”)

Urgency works best when it’s tied to emotions like relief, progress, or fear of staying stuck but not just discounts or countdown timers.

5. Test targeting angles that focus on indirect audiences

Sometimes the best way to outmaneuver indirect competitors is to step into their lane.

Try building campaign segments that target:

• Users of alternative tools (e.g., people who like “Notion,” “YouTube,” “free workout apps”)
• Behavior-based traits (e.g., “meditation app users,” “budget shoppers,” “work-from-home professionals”)
• Pain-point themes (e.g., burnout, distraction, decision fatigue)

Then test messaging that acknowledges their current solution but gently challenges it.

“Still relying on YouTube videos to stay focused? Let’s build a routine that sticks.”

When your ad speaks directly to the indirect alternative they’ve already tried, it feels tailored. It meets them where they are and guides them toward something better.

Responding to indirect competitors isn’t about reacting to trends or copying creative formulas. It’s about knowing your customer better than anyone else and designing your campaigns to serve their real goals, in the context of the choices they actually have.

If you can show up with more clarity, more empathy, and more emotional relevance than whatever else they’re considering, you’ll win. Even when you're not the cheapest. Even when you’re not the first thing they searched for.

Wrapping up

Direct competitors are easy to spot. They show up in your dashboards, bid on your brand name, and look a lot like you. But the real challenge in paid advertising today isn’t what you can see. It’s what you can’t.

Indirect competitors are everywhere. They’re the apps your audience already uses. The influencers they trust. The habits they default to. The templates, tools, and content that quietly convince people to solve their problems in other ways before they ever see your ad.

And that’s what makes them so tricky. Because if you’re only watching category benchmarks and tweaking campaigns based on your closest rivals, you’re likely missing the bigger picture and bleeding performance in the process.

Understanding and outmaneuvering indirect competition takes more than just intuition or good creative. It requires pattern recognition across industries, audience segments, and platform dynamics. It means knowing how attention shifts, how expectations evolve, and how to position your offer not just as another option but as the right one in a sea of alternatives.

And if you’re handling all this by yourself or with a small in-house team stretched across a million priorities, it’s honestly a tough ask. Not because you’re not capable, but because spotting these trends, testing smart angles, and building campaigns that truly cut through the noise takes experience. A lot of it.

That’s where working with a performance-driven agency can make all the difference. Agencies who specialize in paid media have seen what works across industries. As a result they catch indirect threats faster, and they know how to build positioning that wins even in chaotic, competitive ad environments.

So if you’re feeling like you’re doing everything “right” but still not seeing results, it might not be your product. It might just be that you’re playing the game with too narrow a lens.

Zoom out. Think bigger.

And if you need support, work with partners who know how to help you win — not just against who you think your competitors are, but against the ones quietly stealing your growth.