How Cohorts in Marketing Boost Retention and Increase CLTV

Modern marketing has shifted its strategy from a general spray-and-pray model to a more data-driven approach. The success of marketing campaigns now depends on several measurable metrics like engagement rates, conversion rates, marketing ROI, Return on Ad Spend (ROAS), and the overall impact on the marketing budget. All of these factors, in turn, determine the profitability of any business based on the total revenue generated.

However, before you implement a data-driven approach to your business, you need to understand why it is difficult to adopt that strategy. The following sections speak about the issues associated with data, what can you do about it, and how to go about it. 

Bottle-necks of Data-Driven Marketing Approach

The data-driven approach needs analysis of the user data collected across channels and devices. However, there are a few bottlenecks for marketers that hinder their progress while dealing with data. The primary among them are:

1. Collection of data:

Collection of data is a big challenge when it comes to data-driven marketing approaches. The increase in the touchpoints where users are active and the number of marketing channels across the devices generates a huge amount of data. Yet, collecting the data that matters becomes tough at times due to the changing user activities and their online behavior. Unless there is a synchronization between the collected information, handling such a repository becomes an extra liability.

2. Interpreting the collecting data and its integration:

Another major hindrance towards data-driven marketing is interpreting the right data and integrating it with your marketing strategy to create an intent-based user persona. This is essential to make your marketing campaigns targeted towards users who are more likely to convert. If you are unable to interpret and integrate your data effectively, your marketing cost would increase without giving you substantial returns. Moreover, your brand visibility and targeting may go haywire leading to wastage of ad dollars.

3. Automation and Adoption of Analytics:

Lastly, you need a faster and efficient method to make your data work and scale up the audience targeting. Analytics is the analysis of data to understand what makes a user convert. Automation allows your campaigns to work efficiently without any need to design it repetitively. 

Once you have managed all the above three factors, all you have to do is to segment your users according to their intent to engage and convert them. Yet, there still remains the issue of addressing the changing behavioral pattern among these segments.

Cohorts in marketing can help you to mitigate the concerns related to the ever-changing user attributes in data-driven marketing. Cohort analysis is particularly beneficial for verticals such as gaming, ecommerce, or any business in order to understand the factors driving your users to convert. Read on to know what it is and how beneficial it is for your business. 

What is Cohort Analysis & How beneficial is it?

The simple meaning of cohorts is groups. Marketing cohort analysis is a kind of analytics based on the user behavior that leverages the information from audience groups and sees them as subsets, rather than looking at it as a singular structure. Therefore, cohort in marketing refers to specific events, experiences and other such attributes to understand the factors that convert a user.

cohorts marketing funnel

The following are the benefits of analyzing cohorts in marketing :

1. Since the cohort in marketing helps you to analyze the user data to reduce the friction point between users and brands. It also scrutinizes the user behavioral pattern and their changing purchase intent for better targeting. The cohort analysis also helps you to improve user experience and customer lifecycle value, which is the key to increase your revenue and brand value.

2. Knowing and implementing cohorts in marketing helps you activate new users and retain them over time. It also helps you to arrest app churn rate or website unsubscription rates by understanding user attributes. Cohorts also help you to understand the user actions that drive retention, and simply marketing campaigns.

3. Cohorts in marketing help you to reduce the conversion time for successful conversions. In addition, it helps you to retarget your users who haven’t yet converted with engaging communications. Further, it also helps you understand various actions which led to the conversions too. These may include payment gateways, preferred channels for receiving marketing messages, time at which they are most active, and so on. 

4. Cohort analysis helps you to define your segments more effectively. When you are defining your cohorts you are getting an opportunity to slice-and-dice your user information using multiple segments. Therefore, you are able to have a finer knowledge about their preferences and interests. Subsequently, engaging them becomes much easier than through the standard segmentation process.

As you can see, cohorts help you notice smaller things that you might have not analyzed before. It helps you have deeper insights into your marketing funnel by combining your cohorts and invoke positive engagement among your users. Once you have a 360-degree understanding of your users, your marketing becomes more targeted, and efficient.

Strengthening Your Cohorts in Marketing with Engage360

Now that you know what cohorts in marketing is and its importance, you must know how to strengthen your marketing strategy using it. Cohorts analysis depends on accurate collection and interpretation of the user data. Therefore, the marketing automation platform you are using must allow you to have your data on your fingertips. Also, you must be able to track the metrics that matter and work on improving them.

Vizury Engage360 is one such platform that helps you to perform cohort analysis extensively. Engage360 is an AI-powered omnichannel marketing platform, hence it collects data from all your marketing channels. Moreover, since the platform also allows you to collect data from advertising platforms, you can generate a more complete user profile for targeting. 

Once you have all the data in one place, the Engage360 dashboard allows you to analyze it efficiently. You can slice-and-dice the information at your will, and use it to design your marketing campaigns. 

Let me share an example to help you understand how you can use cohorts. Let’s say you have an ecommerce app. The cohort analysis shows that 70% of your users churn within the first day. However, let’s say that the users who have saved some favorite products in their wishlist churn only by 50%. 

Here, it’s difficult to choose which segment you want to target with your marketing messages. So,  what do you do? Cohorts can help you here by creating combinations of cohorts. You can combine cohorts like marketing channels, time spent on your app, availing of offers, and so on to create smaller, yet high-intensity groups and send engaging messages. Since you know the converting factors of your users, you can target them better.

Ending Note

Cohorts in marketing help you to fine-tune the specific needs of your marketing campaigns according to their behavioral attributes. Subsequently, it helps enable you to make your campaigns more efficient and improve your ROI by reducing your wastages. To know more about the Vizury Engage360 cohort analysis, you can get in touch with us at

Sandip Acharyya

A former metallurgical engineer, Sandip switched to be a digital marketer and writer. In Vizury, he shares his experience on retargeting and push notifications, to help entrepreneurs and marketers to improve their marketing ROI. He likes to spend his leisure reading books, watching movies, and making music. Get in touch with him on Twitter or LinkedIn.

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