Hello people! In today’s post you will learn what is Google Analytics Cohort Analysis and how to do it.
WHAT IS COHORT ANALYSIS
Cohort is a group of people of a segment of users based on a time period that share the same characteristics. So cohort analysis is the research of actions a group of users have performed on a given timeframe.
For example, a cohort can be all users that made their first purchase during a specific time frame. By the way, this a very common cohort analysis for ecommerce websites. Or we can see all users based on the date of their first session.
Make sure you check our other blog posts about Google Analytics and User Engagement:
WHAT CAN I DO WITH COHORT ANALYSIS
Generally speaking, we can say that cohort analysis is a more advanced form of analytics than simply checking time on site, bounce rate, page views per sessions or other vanity metrics. Here’s a quick list with examples of what you can do with cohort analysis.
- Know the time gap between first session and first customer purchase
- Discover the retention rate of users based on characteristics like: Having signed up during a sales event, during holidays, or that came from a specific affiliate or referral
- Check user retention rate based on whatever other metric or dimension you want
There are literally hundreds more, you are only limited by your creativity
HOW TO CONFIGURE GOOGLE ANALYTICS COHORT REPORTS
There are four main options that you need to set when creating a cohort report:
- Cohort Type: Since cohort is a segment based on data, cohort type is where you choose what kind of data you want to use to create the cohort. Right now, Google Analytics give us only one option, that is acquisition date. This is the date when the user first visited your website or used your app.
- Cohort Size: Here is where you choose the size of each segment on your cohort. Select “Day” and you will see all users that have the same acquisition day. You can also select to see by week or month.
- Metric: This is the actual metric you want to visualize. There’s plenty to choose like user retention, pageviews or revenue per user. You can also select to see total numbers, like total amount of pageviews or revenue, or per user metrics, like pageviews/user or revenue/user.
- Date Range: This is the amount of time back that you want to check. Different from other reports on Google Analytics, on Cohort Analysis you can’t choose a specific time back to generate the report. Instead, Google give us predefined time frames, based on the current date, that you can analyse.
UNDERSTANDING THE COHORT GRAPH
Cohort analysis graph have 2 main areas. One as a line graph and the other as tabular data explained below.
This first graph shows you the metric you have chosen on the Y axis and the date range by cohort size on the X axis. The values here are based on all sessions and give you the full status of what you are analysing.
In the second graph, the tabular data, we have the entire report range where each column represents cohorts and the rows represent the acquisition date or period.
COHORT REPORT SEGMENTS
Since we are talking about Google Analytics, you can always segment users and that’s really amazing when we are looking at cohort reports. You can apply up to four segments that will create new tables below the first graph.
Segmenting data by traffic source or user device will probably give you some great insights on how to optimize your store, content or conversion funnel.
EXAMPLE OF COHORT ANALYSIS YOU CAN DO
This is the kind of business that can benefit most from cohort analysis. You can see your data by revenue per user, transactions per user or even the total revenue.
Best option here is to increase Cohort Size to weeks and data range to something like 12 weeks. This is especially true if you are selling expensive items that are less frequently bought.
Let’s say that checking a revenue cohort report segmented by a specific campaign you discovered that after the 5th week, sales are declining much faster. With this information you can schedule an e-mail marketing campaign to run on the beginning of week 6 to re-engage the users.
APP BEHAVIOUR AND IN-APP PURCHASES
Some people may call it magic, but cohort analysis is the perfect tool to understand user behavior after they install your app.
Using cohort reports you can understand user retention, in-app purchase frequency and recency, and much more.
PUBLISHERS AND NEWS WEBSITES
It is essential for content publishers to understand user engagement over time, and again cohort reports will help you with this tasks. You can even drop in some other calculation like Adsense revenue, conversion goals, etc.
Cohort analysis is a very good and powerful way to understand how your users engage over time. If you remember that the analysis technique is to check how a given metrics perform over time, you can run hundreds of analysis that will ultimately help your business grow.
Have a question about how to implement cohort analysis on your segment? Drop us a line on the comments section below!