Definition
The canonical answer.
Cohort analysis groups users by when they arrived, then follows each group’s behavior over time: retention, revenue, and payback by acquisition week or channel. It is the honest lens for app economics because it compares users at the same age instead of blending new and old users into one misleading average.
Worked example
In practice.
Blended revenue looks flat, which reads as stagnation. Cohorts show that recent acquisition weeks monetize better than older ones, but are simply young. The blended view hid an improvement; the cohort view catches it, and the scaling decision reverses.
Where this work happens: Data Analysis
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