At Alunta we have decided to createa a dictionary for words and important terms related to running a subcription busniess. You are now reading about “Cohort”.
Cohort analysis offers several benefits to subscription businesses. It allows these businesses to track and analyze customer behavior over time, identify trends, and make predictions about future behavior. This can help to uncover patterns such as customer churn or the average lifetime value of a customer. Cohort analysis can also help to measure the impact of specific actions or interventions on customer behavior, enabling businesses to optimize their strategies and increase customer retention.
In a subscription business, a cohort refers to a group of customers who share a common characteristic or experience within a defined period, such as subscribing to a service in the same month. On the other hand, customer segmentation is the practice of dividing a company's customers into groups that reflect similarity in different ways, such as age, gender, interests and spending habits. The key difference is that cohorts are tracked over time to analyze their behavior, while customer segments are used to tailor marketing and service efforts to different groups of customers at a given point in time.
Check out other topics in our subscription dictionary below. We've gathered the ones we find most relevant in relation to cohort.
