About some economic applications of cohort analysis

Abstract

Nowadays, there is the problem of evaluating the return on advertising costs for industries with a delayed conversion. Cohort analysis is a series of studies which are conducted at certain time intervals. Using cohort analysis we can better assess the effectiveness of advertising channels for industries with a delayed conversion. Cohort analysis can be used to analyze following items: efficiency in the context of "traffic sources", usefulness of changes on the web site; assessment of effectiveness of marketing campaigns; assessment of impact of seasonality on the behavior of the user; the decision-making period. The article presents an overview of tools we can use to collect data for analysis. The article also describes the method of selection and the variants of the cohorts to construct the analysis. For demonstration of the proposed method and calculation variant, there is considered the practical example of building a cohort analysis. Using these method and the example of calculating, the companies with delayed conversion can analyze the effectiveness of Internet advertising for different advertising channels. © 2018 Author(s).