What is LTV Cohort Analysis?

LTV (Lifetime Value) Cohort Analysis groups your customers by the month (or week/quarter) they made their first purchase, then tracks how much cumulative revenue each cohort generates over time. This is the most accurate way to understand how valuable your customers truly are — not just on day one, but over their entire relationship with your brand.

In Datadrew, you will find the LTV Cohort Analysis dashboard under Lifetime Value > Cohort Analysis in the sidebar.

How to Read the Dashboard

The cohort analysis dashboard has three main components:

Summary KPIs — At the top, you will see key metrics including AOV (Average Order Value), total customers, repeat rate, and LTV at 1-month, 3-month, 6-month, 1-year, 2-year, and 3-year windows.
Cohort Heatmap — The main table where each row is a cohort (e.g., "Jan 2025") and each column represents a time period after acquisition ("First Order", "Month 1", "Month 2", etc.). The cells show how much revenue (or orders, customers, or cumulative LTV per customer) that cohort generated in each subsequent period. Darker shading means higher values.
Retention Charts — Line and area charts that visualize cumulative LTV per customer across cohorts, making it easy to spot which cohorts are outperforming and which are underperforming.

Dashboard Controls

Acquisition Period — Set the date range for cohort creation.
Group By — Choose to group cohorts by week, month, quarter, or year.
Metric Selector — Switch between viewing Revenue, Orders, Customers, AOV, Cumulative Orders per Customer, or Cumulative Revenue per Customer (LTV).
Format — Toggle between absolute values and percentages (relative to first-order period).
CAC Column — When you have Meta Ads and/or Google Ads connected, an ad spend column appears showing Customer Acquisition Cost (total ad spend divided by cohort size) for each cohort period.
Filters — Refine cohorts by product, product type, vendor, SKU, shipping country, tags, and more.

Key Insights to Look For

LTV Growth Over Time — Compare cumulative LTV per customer at the 3-month, 6-month, and 12-month marks. Healthy businesses see steady growth, meaning customers return to buy again.
Cohort Improvement — Are newer cohorts generating more LTV than older ones? If so, your retention efforts are working.
Repeat Rate — The percentage of customers who placed more than one order. A higher repeat rate means more predictable revenue.
LTV vs CAC — When ad spend data is available, compare the cumulative LTV per customer against the CAC for each cohort. You want LTV to exceed CAC — ideally by 3x or more.
Seasonal Patterns — Holiday cohorts (e.g., November, December) often show lower LTV because many of those customers were one-time gift buyers.

Actions to Take

If LTV is flat after the first order, focus on post-purchase email flows and loyalty programs to drive repeat purchases.
If certain cohorts have significantly higher LTV, investigate what marketing campaigns or product launches drove those acquisitions and replicate the approach.
If CAC exceeds 12-month LTV, your ad spend is not sustainable — consider tightening targeting or improving retention.
Use cohort data to set realistic customer acquisition budgets based on how quickly customers pay back their acquisition cost.