Real, who were beaten 2-1 by rivals Atletico Madrid on Sunday, are fourth in the standings with 15 points - 6 behind rivals and league leaders Barcelona.
Asked about Real's performances under new manager Jose Mourinho, seven-time Grand Slam champion Alcaraz told Stats Perform on Wednesday that the club "can do better".
"Right now, I'm seeing other teams doing better. They are Real Madrid, great players, talented," added the Spaniard, speaking ahead of the Laver Cup, where he will be part of Team Europe.
"As a team, they can do better. They have to work it out a little bit. I'm suffering right now watching the games because you never know what's going to happen. I would say a little bit more intensity (is needed)."
Alcaraz's Team Europe teammate Casper Ruud also weighed in on football, hailing Norwegian compatriot and Manchester City player Erling Haaland as the best striker in the world.
"His ratio of touches to goals, I mean, no one can match him. No one is even near," the former world number two added.
The three-day Laver Cup begins on Friday in London and will also feature Alexander Zverev, Flavio Cobolli, Jakub Mensik and Rafael Jodar for the Europeans.
Andre Agassi's Team World features Taylor Fritz, Learner Tien, Brandon Nakashima, Alex de Minaur, Alexander Bublik and Francisco Cerundolo.
Team Europe, captained by Yannick Noah, are attempting to reclaim the Laver Cup after last year's defeat by Team World in San Francisco.