How to Perform Cohort Analysis In Behavior Analysis | Enhance Your Business Using Cohort Analysis

Cohort means a group!

If you're concerned about analyzing the behavior of group over time.


Groups over time!


When I was in high school, my "friend cohort" was different from when I was in University and now the "friend cohort" is different again.

I can see how the pattern of my friend group changing over time. The analysis of this behavior is called Cohort Analysis.

Instead of looking at all the users, Cohort Analysis breaks it into groups (cohorts) to help identify patterns throughout the customer life-cycle.

Let's analyze the below Cohort Chart of a website and it's users.

Metric	User Retention
	Total Users	day 0	day 1	day 2	day 3	day 4	day 5
All Users	2413	100%	13.87%	12.42%	10.01%	9.54%	5.08%
Apr-22	166	100%	17.58%	6.06%	4.55%	3.03%	3.03%
Apr-23	580	100%	15.00%	5.00%	1.25%	1.09%	1.80%
Apr-24	640	100%	12.50%	9.10%	6.07%	6.00%	4.27%
Apr-25	281	100%	13.31%	7.10%	2.90%	2.08%
Apr-26	529	100%	10.95%	8.97%	5.90%
Apr-27	217	100%	20.57%	10.78%

- On 22-April-2018
Number of new users acquired - 166
Out of those 166 users, who revisits the website on next day: 17.58%
Out of those 166 users, who revisits the website on 24th April: 6.06%

Let's take another example:

- On 27-April-2018
Number of new users acquired - 217
Out of those 217 users, who revisits the website on next day: 20.57%
Out of those 217 users, who revisits the website on 29th April: 10.78%

- In the given example, you can see how Cohort Analysis visualizes the user engagement over time.
- On the basis of above Cohort Analysis chart, you can also analyse whether user engagement is getting better over time or is only appearing to improve because of growth.


When to use Cohort Analysis?

- Measure your campaign
Cohort Analysis is an absolute tool if you want to track and measure the performance of your campaign.

- Measure Customer Lifetime Value
When you're running a business, you know or you always want to know each of your customer's value. No other tool can give you more insights than the Cohort Analysis.

- When you need more customer engagement
You wanna see the traffic and customer engagement? Cohort Analysis is there for you to help and enhance your customer engagement.

- Test Your Hypothesis
Are you running some test for your hypothesis? To improve the business, it's a very common method that people make some hypothesis based on the relevant data and run test based on it.

- Conversion Funnel Optimization
Suppose, today 1000 new people visits a shop. Out of those 1000 new visitors, 400 people bought some of shop's product. Out of those 400 people, 100 people visits again tomorrow. Can you see how acquisition funnel is automatically creating? With the help of Cohort Analysis, it can be easily interpreted and analysed.


Have you ever used Cohort Analysis? Much appreciated if let me know your thoughts and experiences in the comments below. Please do share the post with your friends as well!