A cohort is a group of people who share a common characteristic over a certain period of time
There are many different analysis and techniques that can be used to measure the performance of your business and help you to take data driven actions/decision. One simple and "easy to use" business analytics technique is Cohort Analysis. It allows you to compare variables and changes between your digital marketing campaigns.
In Engage you will find a Cohort analysis that outputs the customer retention rate on a monthly basis.
The data should read as follows,
- The first column represent the month of customer acquisition, hence it will always be 100% as long as at least one new customer was acquired in the month of interest
- The next column will show the percentage of active customers (made a purchase) in the second month with the acquiring month as a base
- The third column will show the percentage of active customers (made a purchase) in the third month with the acquiring month as a base
- And so on...
For more information about Cohort Analysis and the use cases for Cohort Analysis, please visit our blog. Link to blog.