In ecommerce a cohort analysis is an analysis of customers grouped by some attribute. Most frequently they are grouped by the year and month they first ordered in.
Cohorts each act as a customer segment where each segment has the same/similar attribute.
A Cohort Analysis will analyze customers who belong to each cohort, usually measuring standard ecommerce metrics like:
- Total sales
- Average Order Value
- Repeat Purchase Rate
- Total orders
Once analyzed, the different cohorts can be compared to each other. This allows you to identify over and under-performing cohorts.
Often a cohort analysis will also measure the cohort's metrics over time. This lets you see how the next months after their initial order.
Eric Davis
Learn what your customers are actually doing instead of just guessing
One of the best ways to build a sustainable business starts by getting your customers to come back. Mastering that simple process can be difficult, but builds a lifelong business.
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