Understanding your competition is only useful if it gives you new insights, or new perspectives into your target customer. If you have to make a choice between studying your target customer, or studying the competition, always focus on the customer.
When you do study the competition, if you focus mainly on what the competition is doing you’ll miss the most valuable intelligence.
The what is derivative of the how. It is more informative to understand how the competition views the customer; how the competition studies the customer; how the competition innovates; how the competition deals with costs; and how the competition expects to grow.
But do not obsess over the competition. Keep in mind that truly great companies don’t worry about competitors, they don’t have any reason to.