Setting Up Cohort Analysis Tableau: 6 Easy Steps

on BI Tool, Cohort Analysis, Sales Analytics, Tutorials • March 5th, 2021 • Write for Hevo

Every business should put effort towards understanding its customers better. The best way to understand customers is by analyzing customer data. This can give a business some insights that can spearhead its growth. Such insights help a business know where it’s doing well as well as where it needs to make an improvement. 

Businesses can also use such insights to come up with successful growth strategies. They can learn more about their Customer Retention Rate as well as the Average Lifetime Value (LTV) for their customers. That is exactly what the Cohort Analysis does. 

It helps businesses and organizations to know their customers better and make sound decisions. In this article, you will be learning about Cohort Analysis and the steps for setting up Cohort Analysis Tableau. 

Table of Contents

Meaning of Cohort

A Cohort is a group of objects or people that share a common characteristic.

This common characteristic(s) is generally experienced within a certain time period or is time bound. 

Understanding Cohort Analysis

Cohort Analysis Illustration - Cohort Analysis Tableau
Image Source: https://mode.com/blog/cohort-analysis-helps-look-ahead/

It’s the study of behavioral patterns of a group of Cohorts. Cohort Analysis requires the available data to be logically segregated based on a Cohort characteristic(s). Cohort Analysis primarily helps in identifying patterns across Cohort groups rather than generalizing them blindly without regard for important characteristics or timelines. 

Example: Cohort Analysis may help an e-Commerce Website identify popular products amongst different age groups rather than just getting a sorted list of popular products. Also, it may help identify the hours of the day when these Cohort groups are most active, helping them upsell clearly related products. 

In big data parlance, Cohort Analysis aims to group the available data on the basis of a characteristic of interest, to arrive at Cohorts, and study their behavior to get actionable insights. Modern big data analytics tools provide the facility of Cohort Analysis. 

More information on Cohort Analysis can be found here.

You will learn regarding the broad guidelines on how to set up Cohort Analysis in Tableau. Some details discussed below may slightly differ based on your version of Tableau

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Steps to Set-Up Cohort Analysis in Tableau

In this section, you will be learning how to build a Cohort Analysis in Tableau. 

The following are the general Cohort Analysis steps:

Welcome Screen - Cohort Analysis Tableau

You can use Tableau’s default provided “Orders (Global Superstore)” dataset. 

The welcome screen will list some of your existing database columns as “Dimensions” like CUSTOMER_NAME, PRODUCT_ID, ORDER_DATE, SHIP_DATE etc. It will also show some of your pre-existing “Measures” or calculated fields like DISCOUNT, PROFIT, SHIPPING_COST etc. 

The “CreateCalculated Field” will be our vehicle to define Cohort Criteria. Connect to your “Orders” data source, each order/sale must be attributed to an employee who drove the sale, along with DATE/AMOUNT/ITEMS, etc.

Cohort Analysis Tableau Step 1: Creation of New Field

Create a new calculated field, get your sales data and related employees that drove the sale. For quarter based calculation, create a measure like “SALES_PER_QUARTER” by defining a function like:

DATEDIFF('quarter', starting_toal, ending_total)

Next, Quarters comes in “Columns” or X-axis; Sales volume comes in “Rows” or Y-axis. In the “Marks” box, select “Bar” as the visualization type.

Next, drag and drop the calculated field SALES_PER_QUARTER on the “Color” section of the “Marks” bar. 

Cohort Analysis Tableau Step 2: Addition of Table Calculation

Add a table calculation on sales, expand the “Sales” in the “Rows” space. 

Specify new “Quick Table Calculation” ( DIAGRAM ) , e.g. “Percent of Total”.

Adding Tables - Cohort Analysis Tableau

You can also specify which table, Table(across) or Table(down) to use for calculations. 

Cohort Analysis Tableau Step 3: Selection of the Colour Palette

Clicking on the “Color” button in the “Marks” section lets you specify a Color Palette, and properties like Hues, etc.

Selection of Color Pallete - Cohort Analysis Tableau

Cohort Analysis Tableau Step 4: Generation of Graph

Clicking on the “Show Me” button on the top right allows you to change the graph used in visualization. You can choose between Stacked Bar, Line, and Area, Bubble, Numbered Heatmap, and many other types of charts.

Selection of Charts  - Cohort Analysis Tableau

Cohort Analysis Tableau Step 5: Adding Tool Tips

You can also add Tooltips, Hover details, specify Text Size/Font/Orientation, etc. 

Cohort Analysis Tableau Step 6: Addition of Column and Row Band Totals

Clicking on the “Analytics” tab adjacent to the “Data” tab. 

You can add Column and /row band totals.

Column Band Total  - Cohort Analysis Tableau

You can also change the view to percentages if that is preferred. 

Limitations of Cohort Analysis

The following are the drawbacks of Cohort Analysis:

  • Cohort Analysis requires you to keep a sizeable and detailed dataset within your business, which makes it costly and time-consuming. 
  • It is subject to bias by the person performing the Analysis. This can result in useless results. 

Conclusion

The Data collected by a company can be a behemoth of numbers pertaining to different user types, performing diverse activities at random time intervals. Cohort Analysis lets you see clearly through the maze, identify patterns and differences, to arrive at actionable insights that increase productivity and efficacy. In this article, you learned in detail about the process of Cohort Analysis and the steps that need to be followed for setting up Cohort Analysis Tableau.

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