How to Conduct a Competitor Backlink Analysis and Predict the Budget (Case Study)

There are already a lot of articles on the web on this topic, but in this article, which is the continuation of my previous one - How many backlinks do I need to rank - I will try to answer exactly this painful question, that your average SEO agency usually fails to answer, leaving you puzzled about what probably bugs you the most: how much money do I need to spend to get there?

When we plan our SEO strategy the answers to our questions are right in front of us - on the first page of Google SERP. But the competition analysis can get really confusing. When we open an Ahrefs report for a certain website, what exactly should we look for? When we see a 2M figure in the backlink profile section, does it mean that we must match this number? When we see a list of referring domains, how do we know which ones are the most valuable? And how to predict the budget for the whole operation (at least more or less precisely)?

The perfect specimen

First, I would like to give you a quick tip: if possible, don't go for analyzing the oldest (and usually the most authoritative) websites in your niche. They have been around for a long time and have accumulated a lot of backlinks, so they are in a cruising mode, so we may not find anything useful there. In most niches, there are usually some younger websites that came up not so long ago and are already getting their share of the pie. This usually means that they know what they are doing and what works in the current day and age.

So, in my niche there was a perfect example of a website that was launched 3 years later than I did, and in less than a year they pushed a lot of high-traffic keywords in the niche to top-1-3, and even more to top-10. And since their success was so recent, it was easier to analyze their actions and understand what they did to get there.

What exactly should we look for?

Sort the list by the "First seen" column in ascending order. This way we will see the oldest backlinks first, so we can build a timeline of their backlink building strategy. We can see how many backlinks they got in the first month, in the second month, etc.

At this step the majority of the articles on the web advise to export this whole list, and then process it in various ways. But I think this is not the right way. The list is usually huge and full of garbage, so any automatic processing will not give us the results we are looking for. So what I do is look at each and every backlink using a checklist that I came up with:

Quick warning: some of the aforementioned metrics can be spoofed, so a little more thorough check is needed (in case our competitor fell for it), but this is a topic for another article, check it out: How domain metrics can be spoofed.

This checklist will help us not to only uncover the most valuable backlinks our competitor is building (which we should look at in-depth, i.e. visit the referring page, see its content, the anchor text, etc., more on this later), but also speed up the process by skipping the garbage. For example, if we see that the referring domain has a DR of 0 or receives zero traffic, we can skip it and move on to the next one, because it is highly unlikely that this backlink moves the needle, or if the "Referring domains" number is much lower than "Linked domains", like 100/50,000, we can also skip it, because it is likely that the website is a link farm or some random listing.

This way we uncover the most powerful backlinks that move the needle for our competitor. Those are also usually (not always, but often enough) marked with a "Best link" tag by Ahrefs, which I suppose they are coming up with by more or less the same rules that are listed in the checklist above.

The next thing we should do is manually put the information about each "good" backlink into a spreadsheet. We should write down the date when the backlink was acquired ("First seen" by Ahrefs), the target URL (on our competitor's website), the referring URL (the exact page on the referring website), the anchor text, the referring domain, and also for our convenience the numeric metrics of the referring domain: DR, traffic, the number of referring domains, and the number of linked domains. Boom! We have the whole picture of our competitor's backlink strategy in front of us, month by month.

How to predict the cost of an SEO-campaign

In my case, I uncovered exactly 104 such backlinks that my competitor acquired in the first year (which was enough for them to get a very decent share of the market by the end of that year, nudging some of the oldest competitors out of the top-3).

Here comes the most interesting part! We can both confirm that those links were indeed paid for and also predict the budget for the whole operation. This awesome tool called Link Detective helps us to do exactly that, and it's completely free (this is not an ad, I swear)! Simply copy the list of referring domains from our spreadsheet and paste it into the tool, and for every domain that is present in their database, it will show us the price of the guest post on that domain with the contacts of the sellers (there are usually multiple). And I think it's safe to assume that if the website is selling links, our competitor probably didn't get them for free.

Guess how many of those 104 backlinks that my competitor has built did not appear in the Link Detective database? Only 5! And I'm pretty sure that at least 3 of them were also paid for, but the tool simply did not have them in the database for some reason, and only 2 looked like those mythical natural/organic backlinks. And by putting the prices of every backlink in our spreadsheet we can calculate the total budget for the whole operation. In my case, the prices ranged from $40 to $650, with an average of $170, so the total budget was around $17k. Pretty neat, huh? This is something we can meaningfully work with, compared to some generic "just build more backlinks" advice from an average SEO agency without any specifics.

Of course, since SEO is not an exact science, you may actually need to build slightly more backlinks than your competitor to outrank them, but at least now you have a starting point and a pretty good estimate of what you're up against. It's a good idea to aim for about 10-20% more than your competitor, just to be safe.

We can also calculate the average/median donor DR/traffic our competitor was aiming for. In my case, the average DR was 48, median DR - 50, average traffic - 94k, median traffic - 14k, which are pretty useful numbers for building our own backlink strategy.

What pages should be recipients of the backlinks?

Another interesting thing I uncovered in this research was which were the target URLs for those backlinks on my competitor's website. As I've mentioned in the previous post, there are hundreds of keyword clusters in my niche, so the websites have hundreds of pages. And guess how many pages were targeted by those 104 backlinks? Only 25. The homepage received only 4 links, and the rest were distributed among the 24 other pages, ranging from 1 to 17 per page. But as a result, a big chunk of the other hundreds of pages hit the top-10 for their main keywords as well! Why?

Oh, and one more thing: another hypothesis that I made in the previous post is that there is a certain "critical mass" of authority/backlinks for a domain in a niche, after reaching which, the website starts to rank like crazy. Guess what - it was exactly the case here. Their traffic was climbing up very slowly, and after 9 months it rose sharply and continued to grow.

And then, if you did everything right, you will be rewarded with a sudden growth in traffic.

But wait, there's a way to improve this! Check out the next post of this small series - How to improve a competitor's backlink strategy.