Cohort Analysis is a way to analyze customers in groups. Instead of analyzing their behavior, cohorts are formed based what characteristics they have in common.
Grouping customers into cohorts
In ecommerce the typical cohort analysis uses the customer's first ordering date. For example, if a customer first orders in December 2022, then they'll belong to the
2022-12 cohort along with all other customers who first ordered in that month.
Cohort analysis assumes that many customers who ordered at the same time will have similar behavior. This is a solid assumption as you might be running specific promotions, have specific messaging, or the ordering date is during a seasonal or cyclical time.
Analyzing the customers
Once you have customers grouped into a cohort, you can analyze them for any number of metrics. Remember, a cohort is a group of customers so any advice you find on metrics or customer segmenting can also be applied to cohorts. (In fact, it's useful to compare each cohort to your other customer segments as a way to benchmark your data).
Common metrics used to measure and gauge a cohort include:
- Average Order Value
- Repeat Purchase Rate and Churn
- Customer Lifetime Value and Average Lifetime Value
- Total number of orders and customers
- Total order sizes
The cohort analysis helps you understand customer behavior
A strong cohort analysis can do a lot to help you understand how your customers behave and how that behavior changes over time. The further back in your store's history you do a cohort analysis, the more valuable it can be. Limiting cohorts to only the last year or last two years can hide a lot of powerful insight.
It can be difficult to build and calculate cohorts so if you need help, Repeat Customer Insights can create them for you using your Shopify data.
Articles for further reading
The following are various topics on Cohort Analysis and working with customer cohort data.
The newest articles are at the top.
- Evaluating the impacts of the winter season
- Evaluate your November customer cohort to find repeat customers
- Schedule anniversary campaigns for a regular revenue bump
- Monitor your most important customer cohorts
- New: email subscriptions for Customer Cohorts
- Analyze customer cohorts by their running totals
- The Cohort Analysis: finding profitable customer behavior
- Look for seasonal buying patterns in your customers
- What is a cohort and how can they help segment your customers?
- Track running totals for cohorts using a cumulative rollup calculation
- Compare your cohort analysis to find customer behavior changes
- Improve your cohort analysis by using percentages
- Starting repeat purchase analysis in Shopify
- Correctly configured cohorts should accommodate refunds smoothly
- Use Repeat Purchase Rate to predict a cohort's future ordering
- Analyze your 2022 holiday performance to see what your Shopify store accomplished
- The all-important November and December customer cohorts
- Calculate the percentage of customers who ordered again using a cohort report
- Cohort Reports to see which groups of customers are the best customers
- Using Cohort details to understand why how a cohort of customers is behaving
- Digging into customer details to find your best customers
- How to read a customer cohort report
- Measuring cohort membership
- Breaking down customer acquisition sources for each cohort
- Find out if your holiday customers stuck around
- How many customers belong to a cohort?
- Using new customer acquisitions to find hidden busy seasons
- Unstick your stuck AOVs
- Find early repeat purchases with the updated Customer Orders by Cohort report
- Forecasting how many new customers your store will attract in the upcoming months
- Using cumulative cohort reports to find groups of the best repeat buyers
- What cohort reports teach you about your repeat customer behavior
- Watching Memorial Day weekend to monitor the recovery
- What to check first if your Shopify store sales have dried up
- Find what percentage of customers reorder in a time frame
- Marketing optimizations and patience
- Detailed customer cohort information for Shopify stores
- Find out which customers are annual gift-givers to improve your marketing messages to them
- Using the Cohort Revenue report to see how your customers are buying over-time
- Analyze how your holiday customer behavior was different
- Cohort Reports now include all historic customer purchasing behavior
- How broken habits might be hurting your Shopify store's sales
- Evaluating the early impacts a downturn has on your customer's behavior
- "Extremely happy with this new tool now one of my most valuable in our site"
- Spotting behavioral changes in your customers
- How to understand what a customer cohort is doing
- Two ways to compare different cohorts to find opportunities