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What are Cohorts and Cohort Analysis
What are Cohorts and Cohort Analysis
Apoorva Wate avatar
Written by Apoorva Wate
Updated over a week ago

Cohorts are defined as groups of users categorized together based on a shared action taken in a specific timeframe. In Lifesight, cohorts are created based on the month a customer makes their first purchase. For example, those who purchase for the first time in November form a November cohort, and they remain in that cohort indefinitely.

Cohort analysis is an analytical practice of visually representing the progression of these cohorts over time, tracking specific metrics to reveal revenue drivers and customer behavior within a certain period. Cohort analysis not only provides insight into how and when customers were acquired but also how they engage with your brand throughout their customer journey. The dual objectives of this analysis are to retrospectively evaluate the success of particular campaigns and to establish benchmarks for ongoing customer engagement.

For instance, imagine you've initiated a promotional campaign that offers products at a discount. Through Cohort Analysis, Lifesight helps you monitor these customers to see if their initial discounted purchase leads to subsequent full-priced purchases, offering insights into their purchasing patterns and long-term value to your brand. This analysis sheds light on the timing and frequency of their purchases and the average lifetime spend with your brand.

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