What is Cohort Analysis?
Cohort analysis groups people by a shared starting point, such as the month they signed up, and tracks how each group behaves over time.
Cohort Analysis explained
Looking at all customers at once blends new and old customers together. Following each cohort separately shows whether the customers who joined in March stay as long as those who joined in January.
It is the standard way to see retention, repeat purchase and lifetime value patterns, and to tell whether a product change helped later cohorts.
Example
Grouping customers by first-order month and measuring what share order again in each following month produces a retention table.