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Cohort

Definition

Customer cohorts are a group of customers who share common characteristics, such as age, location, or purchase history. They are often used to determine the most effective methods for reaching out to similar customers by grouping current customers into cohorts for analysis.

In the SaaS industry a common cohort is based on the length of time that certain customers have been with you.

Example:

  • 2021 Cohort: Customers who signed up in 2021
  • Year 4 Cohort: Customers who are in their fourth contracted year with you
  • Q1 2022 Cohort: Customers who signed up in the first quarter of 2022

These cohorts can be used to compare purchase trends but also to compare SaaS specific metrics such as churn rate.

Frequently asked questions

Have another question? Reach out to our retention expert team.

Why should I care about customer cohorts?

The more you know about your customers, the more effective your marketing strategies will be. Segmenting customers into cohorts allows you to tailor messages and offers in order to appeal to each group's particular needs. It also helps you identify opportunities for cross-selling and upselling existing customers, which can help you increase revenue and profit margins.

What are some examples of customer cohorts?

Here are just a few examples:

  • Gender: Men vs Women
  • Age/Generation: Baby Boomers vs Gen Zers vs Millennials vs Gen Xers
  • Location: City dwellers vs suburbanites vs rural residents

Related terms

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  • Step 1

    Create your free Upzelo account and connect your subscription billing data in just a matter of minutes. Invite teammates to help connect accounts with ease.

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  • Step 2

    Obtain real-time subscription analytics, insights and benchmarks. Set up alerts to notify you via email or Slack when a particular event takes place.

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  • Step 3

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    Example of a cancellation flow with Audience at the top, leading to a Bi-monthly billing survey, 10% off next bill and finishing with a Confirmation message