How to Measure the Success of Social Media Campaigns





If you want your company to reach as many potential customers as possible, you need to maintain a presence on one or more social media platforms. Social media is a great way to interact with your current customers and advertise to new ones through social media campaigns.

But how can you measure the success of social media campaigns? Furthermore, what should you measure? Let’s start at the beginning.

What is a Social Media Metric?

Social media metrics are data points that measure the impact of social media activity on your company’s revenue and help you determine whether you’re achieving your social media goals with your current strategies. 

Some examples of common social media metrics include:

  • Follower count on a single platform like Instagram.
  • Number of impressions, or people who have viewed a single post.
  • Click-through rate if your post includes a URL.

Why it’s Important to Track Social Media Metrics

It is essential to track social media events using a behavioral analytics tool like Kissmetrics so that your marketing team can measure the success of their campaigns, how their strategies perform, and the overall impact of social media on your business. 

The Success of a Campaign

If the success of an individual campaign is the primary focus, it can be measured in a variety of ways. You can compare the content of one campaign versus another through an A/B test. You can analyze which social media platforms perform best with your target audience.

You can also generate individual URLs for each campaign and track which people are clicking through to reach your website’s landing page. 

From there, analytic tools like Kissmetrics can chart the user’s journey through your website and conversion rates, keeping all of your data in one place. 

Social Strategy Performance

Knowing how to portray your company across social media is crucial if your campaigns are to succeed. Even a well-crafted campaign on the right platform can fail if it doesn’t match your company’s social strategy. 

For example, if your company comes across as earnest and kind, a campaign that focuses on smearing a competitor is unlikely to appeal to your existing customer base. 

Impact on Overall Business

Higher-level executives may be wary of increasing the marketing budget, but if the team shows that they have significantly impacted sales, they’re more likely to be given greater access to necessary resources. So if your marketing team can present demonstrable results from their campaigns, it will be easier for them to create and promote the next one. 

Steps for Measuring Success of Social Media Campaigns 

Measuring the success of social media campaigns doesn’t have to be tricky. By utilizing an analytics tool like Kissmetrics, you can compile many different data points into a single report so that you can draw meaningful insights from the information coming in. 

The following steps show how to measure your campaign’s success. 

Set Goals

Depending on historical performance, your marketing strategies and the current size of your user or customer base, you should work with your marketing team to create realistic goals. 

Your goals could include increasing the number of followers on a platform, achieving a higher click-through rate on your individual posts, or promoting the posts so that more people see your company profile. 

Create Metrics for Measuring Goals

Once you have decided which goals you want to focus on, you’ll need to select the metrics that measure how effective your campaign is at achieving those goals. 

Monitor and Report

As the campaign proceeds, you should gather daily, weekly, or monthly reports that compile the data from your social media metrics and compare that data against your targets. If you find that you’ve fallen short during one timeframe, you should consider why users aren’t engaging and what improvements you can make. 


As you continue to monitor your campaign, you might find that certain aspects could stand improvement. Luckily, it’s quite easy to create a new post and give it a separate URL so that you can track how much impact your changes had on your overall campaign. 

What to Measure

Knowing what to measure in your social media campaigns is the first part of deciding which KPIs to monitor. 

The following metrics are often the most important.


Measuring engagement means looking to see how many people liked, shared, or commented on your social media post. Generally, when you create a post, the only people who will see it are your followers.

While this is a great way to interact with existing users or customers, the only way to expand your user and customer base is for followers to share your post with their followers or to pay the platform to promote your post. 

Impressions or Reach

Reach is essential for attracting new people. Ideally, your post’s reach far exceeds your follower count so that potential customers will become aware of your company and what you offer.


Depending on how much you’ve invested in the current campaign, you’ll want to calculate your return on investment (ROI) by measuring how much revenue you can tie to the campaign. 

Widespread campaigns with lots of interaction may not be profitable at the end of the day so you’ll want to know how to budget and optimize  future campaigns. 

Response Rate and Time

Response rate measures how quickly or often your company responds to users and increases interaction. When people expect your account to respond, they’re more likely to comment or ask questions on your posts. 

Just ensure that your team responds in a friendly and timely manner.  

What is a Key Performance Indicator (KPI)?

Any demonstrable means of assessing an item, service, client, employee, or company is referred to as a KPI. KPI’s have the following attributes:

  • They Are Key Indicators of Progress Towards the End Goal – The real-time data provided by KPIs lets you observe how the campaign is performing and how long it takes you to reach specified goals. 
  • They Focus on Strategic and Operational Improvement – By tracking your chosen KPIs, you can quantifiably measure where you need to improve so that you and your teams can plan strategies to address those issues. 
  • They Provide Analytical Basis for Decision Making – Decision-making should always be based on analytical data, instead of gut feelings. Seeing exactly how your campaign is performing is a much better indicator than just asking your marketing team how they feel about it. 

What are 5 Key Performance Indicators

The following KPIs provide relevant insights into how your business is progressing towards your goals. 

Revenue Per Customer

This is a simple and straightforward KPI to track. By dividing the total revenue per year by the number of customers enrolled, you get to the annual revenue per customer. This gives you a rough estimate of how much individual customers add to your revenue and can help you calculate how much you should be spending on customer acquisition costs (CAC). 

Average Class Attendance

For companies that offer fitness, education or other classes as a product, average class attendance is a good way to measure how many users are actually tuning into the classes their subscription is paid for. Full classes are likely to be the profitable ones as well as the result of a good instructor or course content. 

Retention Rate

Retention rate measures the percentage of customers who continue to use your products or services or maintain their subscription during a given timeframe.

Profit Margin

Your company’s profit margin during a campaign is usually one of the most important metrics. It is measured by adding up the total revenue attributed to the campaign and subtracting the costs involved in creating and promoting the content. 

Average Daily Attendance

Average daily attendance measures how many people utilize your product or service each day. 


When you spend time and effort planning a social media campaign, you want to monitor it throughout its entire lifecycle to ensure that it not only engages current and potential customers but that it also brings in revenue. Otherwise, it wasn’t successful. By measuring the right aspects of your campaign, you can optimize future efforts to promote your company and achieve your goals.


Visit Kissmetrics for more information about tracking social media campaigns and measuring their success. 



What is a KPI? Definition, Best-Practices, and Examples | Klipfolio

All of The Social Media Metrics that Matter | Sprout Social

The 7 Most Important Social Media Marketing Metrics |

Customer Lifetime Value: What is it and How to Calculate It




One of the most critical KPIs for your company to track is your customers’ lifetime value (CLV). Customers are key for any business and knowing what your customers are worth is critical. Customer lifetime value is a perfect metric for companies looking to understand the potential each new client brings to the table.

What is Customer Lifetime Value (CLV)?

Your CLV is the calculation of how much money the average customer contributes to your company over the duration of their relationship with your company. This KPI is helpful for seeing how much each customer spends and determining the true value of gaining and keeping a new customer. 

Why is CLV Important?

Customer lifetime value gives your company important insight into the potential value of each customer, making forecasting a much easier process.  It’s critical for any business to understand what each customer is worth from a financial perspective. Customer lifetime value gives your company a clear view of the financial value provided by each customer. 

For instance, when looking at customer retention, CLV is a perfect KPI to use for justifying a budget. CLV can also help determine customer loyalty programs. Discounts or incentives can be justified based on the value each customer will continue to bring to your business.        

How Does CLV Relate to Customer Acquisition Cost (CAC)?

Customer lifetime value is a great KPI to compare directly against customer acquisition cost.  When dividing CLV by CAC you then get the ratio of CLV to CAC, a sign of customer profitability and how efficient your marketing strategy is performing. 

Remember, attracting new customers to your business can be an expensive process, especially if you don’t have a clear understanding of what each customer can bring to your company. So, It’s also important to make sure CAC isn’t outpacing CLV. 

If your business model does not rely on many repeat customers, then you’ll need to account for the cost of acquiring new customers. CLV is a helpful KPI to use when setting budgets for attracting new customers. 

How Do I Calculate Customer Lifetime Value?

Customer lifetime value is a calculation of multiple data points. These points can vary from company to company depending on the products or services being offered. Kissmetrics can help you narrow in on the most important metrics for your situation with our Metrics tool. Some of the most popular data points to calculate CLV:

  • Average purchase value
  • Average purchase frequency rate
  • Customer value
  • Average customer lifespan
  • Final CLTV

Average Purchase Value

The average purchase value is a metric that represents the average cost of a purchase made by a customer. This metric will often be used alongside a metric that shows the average number of units per transaction. Average purchase value will vary widely depending on your products or services. Kissmetrics can help you narrow in on a good goal for your company. 

Average Purchase Frequency Rate

The average purchase frequency rate is the measure of how often customers are buying services or products from your business. The calculation for this metric is the number of goods or services sold in a period divided by the number of unique customers in the same period. The period for this measure can be set based on how far back you’d want the trends observed.

Customer Value

A metric that shows what value each customer brings to your company over a given period is customer value. When you combine the average purchase value and the average purchase frequency rate, you can then calculate the customer value metric. The customer value metric is also time-sensitive, so it will need to be calculated over set periods of time.

Average Customer Lifespan

The average length of time a person is an active user with your company is calculated as the average customer lifespan.  The parameters for what constitutes an active customer will depend on your business but should include customers that are spending money with your business on a regular basis. If a customer leaves for an extended period and then returns, they would most likely count as a new customer. Average customer lifespan is the final metric needed to calculate customer lifetime value.

Final CLV

In order to calculate the CLV, you need to have your business’s average purchase value, average purchase frequency rate, and average customer lifespan. With these metrics, you’ll know how valuable each customer is at any given time and how long they are likely to stay a customer of your business. These measures will then give you the CLV metric, which is key for projecting the long-term outlook of your business.

What Main Factors Affect My Company’s CLV?

Customer lifetime value is influenced by many factors in your business so it’s important to monitor all metrics that drive your CLV, but some are more important than others. For most businesses some of the key factors are:

  •  Churn rate
  • Customer loyalty
  • Customer satisfaction
  • Scalable sales and marketing

Churn Rate

When referencing customers, the churn rate is the number of customers that leave your business over a given period. Some churn is normal for all companies, but it’s key to monitor this metric and compare it to the new customers gained over the same period. Since churn rate measures how many customers are leaving your business, it plays a huge factor in your company’s CLV metric. Finding ways to reduce your churn rate and hold on to customers is an excellent way to increase your CLV.

Customer Loyalty

The customer loyalty metric is a measure of how likely it is that a customer does repeat business with your company. This metric is also set over a specific period, depending on your business type. Getting a new customer to your business is important, but bringing back a customer for repeat business is even better. Customer loyalty has a huge impact on your CLV KPI. Even slight increases in the number of customers that become repeat shoppers will yield big increases to the CLV number.

Customer Satisfaction

How happy your users are with your company is the customer satisfaction metric. Unlike the other metrics, feedback from customers is required to measure customer satisfaction. Tools like feedback forms, surveys, product reviews, and other rating forms can be combined to create an overall customer satisfaction metric.  Customer satisfaction has an indirect effect on many metrics, most importantly CLV. No matter what products or services your company offers, customer satisfaction should always be something a company strives to improve.

How Can I Improve My Company’s CLV?

Improving your company’s CLV is vital to the growth and success of your business. A few great ways to improve your CLV are:

  • Email and SMS retargeting
  • Loyalty programs
  • Open communication
  • Effective onboarding

Email and SMS Retargeting

Some handy tools for helping convert more sales are email and SMS retargeting. It’s important to collect existing, and if possible, new, email addresses or phone numbers from your customers in order to send them retargeting content. Emails or SMS can contain things like requests for product reviews, reminders to finish checking out a cart, sales notifications, new product alerts, and other notifications to get them back to your business. These are great ways to get more customers back to your site, increasing your CLV metric.   

Loyalty Programs

Creating a system that rewards customers for staying with your company would be considered a loyalty program. Signing up for emails or SMS could be an effective option for loyalty programs. As customers spend more money, the rewards could increase, giving increased incentives for the customer to remain loyal to your company. Rewarding top customers helps customer satisfaction and increases CLV.

Open Communication

Creating open channels of communication helps build customer trust and holds your business more accountable. Gathering customer feedback to look for improvement is a good example of open communication. Customer opinions can often provide insight on products or services that may not have been previously considered. Having a quick and responsive customer service department is a great way to achieve open communication with your customers. Better interactions with customer service improve a customer’s satisfaction which helps to increase their CLV.

Effective Onboarding

Customer onboarding is key to setting up a good relationship with new customers. Making sure customers get the proper information about your products and services maximizes the value your company delivers. The onboarding process can also be about teaching customers how to work with your business. It’s a good opportunity to establish a good line of open communication, critical for improving CLV.


While the calculation for CLV may vary slightly by company, the importance is high for all companies. When making decisions in your business, always keep CLV in mind. Kissmetrics can help you track your CLV and other important KPIs. Company growth and success depend on a strong customer base that continuously returns to your products. 



The Case for Customer Value as your Lead Metric in 2021

The Value of Open Lines of Communication with Customers

The Four Secrets Of Achieving Customer Satisfaction

Google Chrome Removes 3rd Party Cookies | Implications for Digital Marketers


What Are 3rd Party Cookies?

3rd party cookies are cookies that are created by a different website or domain than the current website you’re browsing. Online advertisers commonly use 3rd party cookies to track users’ activity across various websites. This information provides more insight into users’ tendencies and behaviors, which in turn helps advertisers tailor their strategies.  3rd party cookies are only accessible on a domain if that domain allows outside parties’ cookies. 

How Are 3rd Party Cookies Different from 1st Party Cookies?

The main difference is the domain the cookie lives on. A first-party cookie is created by the website you’re currently browsing, while a 3rd party cookie is created by a different site altogether. 

For a 3rd party cookie to load, the website you’re browsing needs to load that 3rd party server’s code. For a 1st party cookie, any code on the domain could potentially read and set the cookie. A 3rd party cookie needs code from the publishing domain in order to read and set the cookie.

Why Are 3rd Party Cookies Important for My Business?

One of the most common uses for 3rd party cookies is targeted advertising. Because these cookies follow you from website to website as you browse, they report back your browsing history and searches. 

Have you ever searched for beach vacations and a few days later started to notice ads about beach trips on your browser? This could have been from a 3rd party cookie tracking your activity. 3rd party cookies can also be used by support chat systems provided by another service. These chat systems are operated by outside companies that need to be loaded on your domain. 

Why Is Google Chrome Removing 3rd Party Cookies?

Chrome is stepping up and offering users more privacy when browsing by removing 3rd cookies. Other browsers, such as Safari and Firefox, have already taken action and removed 3rd party cookies. Most users don’t fully understand how cookie tracking works and what information is collected by 3rd parties. Advertisers could use 3rd party cookies to track your entire browser history which critics would say is surveillance and an invasion of privacy. 

While some would argue that 3rd party cookies offer tailored ads that are helpful, most people feel the cons of invasive web tracking outweigh the pros. Google has been slower to transition, the thought being they’re trying to balance between online advertisers and personal privacy. 

Their solution is called the privacy sandbox.

What Is the Privacy Sandbox?

The privacy sandbox is a series of proposals by Google that will allow users more privacy and will still preserve the ability for advertisers to tailor ads. This initiative will replace 3rd party cookies and keep users’ data private. 

The privacy sandbox will lump users with similar browsing histories together, allowing advertisers to target groups with tailored ads without seeing an individual’s personal data. Google created the privacy sandbox to avoid blocking the user’s browser history altogether, keeping advertisers away from less transparent forms of tracking data. 

Users will still have the ability to change settings and opt-out, but by default, the privacy sandbox will offer more shielding from companies looking to collect personal browser habits.

What Will Replace 3rd Party Cookies?

Despite some of the privacy concerns, 3rd party cookies have value and provide valuable information. So, with Chrome removing 3rd party cookies, what will replace them? Some of the notable options are:

  •  Identity Graphs
  • Conversion Measurement APIs
  • Contextual Advertising
  •  Aggregate Reporting APIs
  • Trust Tokens
  • Capped Privacy Budgets
  • Federated Learning of Cohorts (FLoc)

Identity Graphs

An identity graph is a database or table of user-profiles and identifiers that are tied to users. The profiles are generic types of users that could be assigned to a group based on certain qualities. 

Some examples would be a new homeowner profile or a recently retired profile. Identity graphs can also contain personal information such as an address, birthday, mobile phone, and email. All this information can be combined to create an advertising plan specific for a user based on profile and personal information.

Conversion Measurement APIs

A more anonymous way to track the success of an advertising campaign is the conversion measurement API. When a user clicks on an advertisement, an API call is made signaling that the ad was interacted with. The API call can attach information like campaign id, or click id, or the time and date of the interaction. 

When the user gets to the advertiser’s website, the API information can be tracked to see if that visitor makes a purchase. Conversion measurement APIs can track how effective ads are on visitors without using potentially invasive 3rd party cookies

Contextual Advertising

Contextual advertising is an approach based on webpage content instead of user behavior. This is a way of targeting based on website content or mobile applications, not the users who browse them. 

Contextual advertising reads the text of a page and searches for keywords or phrases and loads advertisements based on those search results. Users are kept anonymous since the targets are solely based on the webpage content. 

Aggregate Reporting APIs

When looking to get the big picture of advertising campaigns, aggregate reporting APIs are a great option. These reports would be used for seeing the performance of advertisements across multiple metrics, which will help to give a better sense of overall performance. 

Examples could be reports of which ads perform the best by age group, or what types of ads have the highest level of interaction. Aggregate reporting APIs can vary widely, but when combined, they help give you a good idea of the overall effectiveness of advertisements. 

Trust Tokens

An anonymous way to verify users is by using trust tokens. Trust tokens work by assigning users an encrypted token that is stored in the user’s browser. This trust token can then be used to authenticate a user without requiring any private information. 

The token will stay valid during the session and allow the user to browse the domain securely. The user’s activity can then be tracked and stored for research without requiring any additional personal information. 

Capped Privacy Budgets

Capped privacy budgets are a way of limiting the number of private information advertisers can see. Giving advertisers access to some personal information can be helpful for making ads more targeted and relevant. If advertisers exceed the cap amount they could be restricted from advertising on the site.  By limiting the amount of personal information that is collected, users can browse with more privacy and less intrusion.

Federated Learning of Cohorts (FLoc)

The federated learning of cohorts (FLoc) is a new approach to track ad performance that uses machine learning to group users. The FLoc approach can gather browser history, the content of webpages or other specific factors to assign a user to a cohort. The code that creates the user cohort would live on the browser, keeping the users’ private information from being uploaded elsewhere. The browser can then expose the cohort so that advertisers can use this to target ads specific to the user. Federated learning of cohorts is an excellent alternative to 3rd party cookies because it gives advertisers the data they are looking to track while keeping users private information safe. 

How Will This Affect My Business?

If your business relies on 3rd party cookies, you’ll need to plan for an alternative moving forward. With support from Chrome ending, businesses will need to adapt to the new system Chrome implements. If your website allows advertisers that use 3rd party cookies, you’ll need to plan with them. Kissmetrics can help your business prepare for Chrome’s replacement to 3rd party cookies. 

How Can My Business Prepare for the Removal of 3rd Party Cookies?

If your business is using 3rd party cookies you’ll need to pivot to a new way of tracking advertisement performance. Kissmetrics has the tools to track user behavior and provide you with the data needed to keep tabs on your performance. With Kissmetrics you’ll be able to analyze your users’ behavior in any browser while keeping their personal data secure. 


Chrome removing its support of 3rd party cookies is a move intended to give users a more secure browsing experience. This can present a challenge to digital marketers who rely on these cookies to target ads to specific users. Ultimately, digital marketers will need to shift to Chrome’s replacement system when it is officially rolled out or implement a behavioral analytics tool like Kissmetrics. 



Google Effort to Kill Third-Party Cookies in Chrome Rolls Out in April |

ID graphs: The Path to Identity Resolution |

Federated Learning of Cohorts | Github

Cohort Analysis: Beginners Guide to Improving Retention




Brand awareness is great, but experienced business owners know that the key to success isn’t about attracting new customers; it’s enticing existing customers to return. Cohort analysis is one way to measure how long users interact with your website or product before leaving and can provide valuable insights into areas where you need to improve features. 

What is a Cohort?

A cohort is a group of users who share common traits based on an event you track. So, for example, you could segment users who visit your website over a period of six months, by which week they visited. 

Why is Cohort Retention Important?

Simply put, cohort retention is important because it’s more expensive to acquire new customers than it is to keep your current ones. To know if you’re retaining specific cohorts, you need to track their behavior. This will give you two types of information: a) it will tell you whether or not you’re retaining users at all or whether new users are masking a major churn issue, and b) it will give you insight into how to keep those cohorts happy. 

What is Churn?

Churn is when a customer decides to stop using your product or services. This might mean they cancel a subscription, cease logging in, or stop buying from your company. A high churn rate is a red flag, even if you continue to reel in plenty of new customers.

What is Cohort Analysis?

Cohort analysis is the process of segmenting your website visitors or users into groups based on their characteristics or interactions within a specified time. Everyone in a cohort has made the same decisions and triggered the same events within the period or they share a trait such as a geographic location or belonging to an age group. To conduct cohort analysis you will put your parameters into your product analytics tool then check the data regularly for trends. 

The purpose of this analysis is to track cohort behavior over time. You’ll see whether you have a high churn rate among existing customers, or perhaps just those that come in on a trial offer. You’ll be able to see whether your consistent MRR reflects a good product or all-star sales and marketing teams (and perhaps a product with problems). 

Cohort Data Types

There are two different types of cohort data: acquisition and behavior. 

Acquisition cohorts are based on when a user initially created an account or first used your product. They provide information about how long a user continues to interact with your product or service after they start. Knowing when your users are leaving your software is essential to see where you need to improve. For example, if users are leaving after a day or two, that could mean they are having difficulty with onboarding or using your software or product. To solve this, you could provide more explicit instructions or offer onboarding assistance. 

Behavioral cohorts are based on behaviors that users have or have not performed within your software. For example, they can be people who visited your website but didn’t sign up for an account or users who signed up for your mailing list but didn’t purchase anything. If you monitor a cohort who visits your website, creates an account, and signs up for the mailing list within a small time frame. You’ll see how long they continue to log in to their account afterward or if customers who create accounts are more likely to purchase your products. 

Cohort Analysis Example

As we noted above, a standard cohort analysis looks at visitors to your website, both new and returning. Over six months, you can measure the number of new visitors who sign up with your website and how many of them returned to the website within that time. 

For example, if you begin measuring on the first day of May, you can see the percentage of new visitors returning in June, July, August, etc. This information can show you how long the average user spends utilizing your product whether it has legs. 

How to Do Cohort Analysis

Performing a cohort analysis requires four steps: 

  • Creating a question – What do you want to know about your users? 
  • Selecting the metrics – Do you measure how many consecutive days they log in to their account? The length of time between creating an account and purchasing a product?
  • Designing cohort identifiers – Are you segmenting your cohorts based on user behaviors or time?
  • Running the analysis – Pulling the data and visualizing it to find the answers to your initial question.

How to Build a Cohort Analysis Report Within Kissmetrics

In Kissmetrics, we offer various parameters to maximize the amount of helpful information in your cohort analysis report. The first step is to specify your date range for people performing the first event. Then you select the events to monitor, like visiting your website, logging into their account, utilizing your software, etc. 

The next option specifies the period of each cell. It lets you narrow the scope of the question, “After doing Event 1, how many hours, days, weeks, or months did it take these people to do Event 2?”. Then, choose whether you want to group people based on time or property. Time looks at when people performed the first event—property groups based on a property you set beforehand.

How to Use Cohort Analysis Data to Improve Retention

Essentially, cohort analysis watches how groups of people interact with your product and how those interactions change over time. Understanding the staying power of your product and how long users interact with it can help you determine where you need to improve it to increase user retention. 

Uncover Friction Points

Acquisition cohort analysis gives you the data to map out a retention curve. So, you can see approximately how many days, weeks, or months your average users stay connected with your product before churning. Typically, the most significant drop-off will be within a few days of starting use since many users may be casual visitors or may not want to continue dedicating time and effort. 

However, suppose the initial drop-off is larger than expected. In that case, it may reveal a friction point where customers may not be getting the information they need to set up the app or to utilize your product’s basic functions and are quitting out of frustration. 

Study Which Actions Drive Retention

Behavioral cohort analysis dives into the “why” of churn. If users who don’t interact with one of your product’s main features are the ones who quit within the first week, that’s an indication that they either need to be prompted to use it, or taught how. 

Alternatively, if users trying to pay with cryptocurrency regularly appear to cancel their subscriptions after the first month, that indicates your payment system may not be working correctly or is not optimized for that type of payment method. 

Benefits of Cohort Analysis For Your Business

Cohort analysis provides a variety of benefits for your business by providing deep insights into your user actions and behaviors. We explore a few of them in the sections below. 

Increase Customer Lifetime Value

Cohort analysis helps to establish your customer lifetime value, or CLV, since it gives you an idea of how many customers continue to engage with your company. Customers often spend the most money during their first month, but you can determine why customers decrease their spending and then take actions to potentially increase their CLV by addressing those issues found in a cohort analysis. 

Identify Loyal Customers

Cohort analysis doesn’t have to focus solely on the users who leave; it also identifies the people who stay. You might find that visitors who spend a week with an active account before purchasing your product are more likely to continue engaging with it for a long time, as opposed to visitors who buy on the same day their account is created. 

Improve Product Testing

When you roll out a new update, cohort analysis can show the percentage of users who decide to leave within a given timeframe after the update was released. Thus, you can test new features, bug fixes, and updates by monitoring when customers leave. 


Cohort analysis allows you to obtain detailed insight into your conversion funnel, how long users interact with your product, and when they start leaving. This information sheds light on actions you should taketo improve your product or website.


Visit Kissmetrics for more information about cohort analysis reports and how your business can benefit from them.



  1. Cohort Analysis: Beginners Guide to Improving Retention
  2. Cohort Analysis: The Key to Improving User Retention for Your App
  3. Cohort Analysis: An Insider Look at Your Customer’s Behavior

What is Customer Churn?




Understanding why customers stop purchasing from your company is critical, regardless of industry. However, it can be challenging to differentiate between solvable issues with your product or service versus external problems that exist for your company. 

Here we explain what customer churn is, why it’s important, how to measure it, and how to reduce it and keep your customers satisfied.

The Definition of Customer Churn

Churn is when a customer decides to stop using your product or services for some reason. This might mean canceling a subscription, ceasing their logins to your website, or not buying anything else from your company. A high churn is often a bad sign for companies, even if you’ve got plenty of new customers, as we explain below.

Why is Customer Churn Important?

Customer churn is a metric measuring long-term satisfaction with your company, products, and services. It’s more expensive to appeal to new customers than to retain existing customers. So businesses who inspire devoted brand loyalty often find that their profits increase significantly when they reduce their customer acquisition costs.

Knowing how long users typically engage with your products or how long they subscribe to your services is a major indicator of how satisfied they are. If people aren’t sticking with your products for very long, that usually means there’s room for improvement on your end. 

Causes of Customer Churn

There are plenty of reasons why customers churn, some are within your control and some are external. Any one of the following reasons might inspire some of your customers to churn.

  • Replaced by a competitor with lower prices/more features/features that add more value
  • Need no longer exists
  • Money is tight
  • Dissatisfaction with the product/service
  • Dissatisfaction with your company’s customer service
  • Dissatisfaction with your brand’s message

How Do You Identify Customer Churn?

Identifying customer churn isn’t as simple as you might think. The reason is that the majority of metrics measure the number of active users at any given time. If you have a large number of new users signing up for accounts, your user numbers might look steady over time. 

However, if most active users are new users and not existing ones, you’ll be spending more on customer acquisition costs than you need to.

Cohort Analysis

Cohort analysis is the process of segmenting your website visitors or users into groups based on their behaviors and interactions within a specified time. Everyone in a single cohort has made the same decisions and triggered the same events within the period and parameters you input in your product analytics tool

Kissmetrics’ cohort report shows you the people who progress from doing one event to doing another event. It also shows you if people are repeatedly doing a single event. This can demonstrate whether you have a high churn rate among existing customers and are only seeing consistent user numbers because of incoming users or if your users are sticking around for multiple cycles. 

What is Churn Rate?

Your churn rate is the rate of existing customers who stop doing business with your company over a given timeframe.  

Churn Rate vs. Growth Rate

Churn rate and growth rate aren’t opposites like their names might lead you to believe. Your growth rate is the number of new users your brand acquires in a given timeframe. It’s essential to distinguish these new users from your existing users because otherwise, enough new users could disguise an alarming churn rate if you only measure currently active users. 

How to Calculate Customer Churn

Calculating a customer churn rate requires you to choose a timeframe first. For example, if you wanted to calculate customer churn during the month of June, you would take the number of subscribers who canceled their subscription or failed to renew it and divide that number by the total number of subscribers at the beginning of the month. The answer is your churn rate. 

What Does a High Churn Rate Mean?

Typically, a high churn rate means your product or service is not providing long-term satisfaction. This might mean people try your app for a few days before becoming bored with it and moving on. Or that the customer doesn’t value your service enough to continue paying for it. 

Is There an Acceptable Churn Rate?

Churn rates often vary widely between industries. However, product analytics tools and informational websites often present reports on rough estimates for churn rates in some of the largest industries at the end of each fiscal year. 

According to Statista’s 2020 report, the industries where companies saw the most considerable churn rates were credit card companies and cable companies, with an average churn rate of 25%. Conversely, big-box electronics stores saw an average customer churn rate of only 11%. 

How Do You Reduce Customer Churn?

While every business must deal with some amount of customer churn, there are also steps you can take to reduce your customer churn and incentivize customers to stick with your company.

Listen to Your Customers

Everyone likes to feel like their complaints are being heard. When customers leave you negative reviews or feedback on surveys, it’s easy to dismiss them and forget about it, but that feedback is quite valuable. When customers specify where they had issues with your product or service, you can take them into account and look for solutions.

Similarly, when customers praise your company for a feature or function, you might consider focusing on it in the future. If you’ve made something that meets or exceeds their needs, maybe that is what you should be advertising or updating in time. 

Provide Great Customer Service

Whatever your product or service may be, customers will likely need to contact your business directly at some point. Whether it’s because they’re having trouble setting up your software, they’ve encountered a major error, or something else altogether; most companies must interact with their customers.

You should try to provide as many avenues of customer support as possible. Nowadays, people aren’t always content to call a hotline; they want options. Including an email and a live chat are a step in the right direction since no one likes to be on hold for hours at a time. 

Generally, customers contact support when there is a problem, and emotions can run high. That’s why you need to ensure that your customer service/customer success representatives are patient, helpful, informative, and proactive. Customers are already in a bad mood because something went wrong, but you can demonstrate why they should stick with your brand with great customer service. 

Exceed Expectations

You should constantly be looking for ways to exceed your customers’ expectations. Whether that means taking surveys to see which features need some improvement, making more customer support available, or otherwise interacting positively with customers, you should be proactive in reaching out to your existing customers and making them feel valued.

You can also exceed expectations by building great products. Use an analytics tool like Kissmetrics to track what customers use/buy and what gives them problems. Track your UX to see where customers get stuck. By spotting and solving problems before customers bring them to your attention, you’ll not only exceed their expectations but likely reduce churn in the process. 

Let Some Churn

Some customers are going to churn for reasons you can’t fix without a complete pivot. For instance, if your brand makes a luxury product, an economic downturn or global pandemic might make it unaffordable for some previous customers. Alternatively, customers might have a more intimate change in their lives like having a baby that forces them to change their habits, they might move away, or find a replacement. 

One way or another, you’ll have to come to terms with some amount of customer churn.

Identify Problems and Fix Them

Knowing where users drop off in your conversion funnel is a powerful antidote to a high churn rate. If you can see exactly where users become frustrated or stop interacting with your product, you’ll be able to pinpoint the problems and find solutions. 

For example, if you see that customers who churn within a month are never using one of your product’s key features, it could be they need more instruction or encouragement to use it. Especially if that feature is popular amongst power users. But if no one is using that feature, then it might be too complicated to figure out, or users don’t find it useful. Kissmetrics’ activity report will show you what users are doing with their accounts so that you can see which features are being used. 

Similarly, the cohort report will provide information about clients who complete designated events. You can see if the people who are churning haven’t completed specific events and whether that may have affected their decision. 


Customer churn may be a part of doing business, but you don’t have to just accept it for your company. By identifying how many customers are churning, how long they take to churn, and why they’re leaving, you can retain more existing customers and lower your customer acquisition costs. 

Get in touch with us to learn why customers churn and how you can prevent it.



Cohort Analysis: Beginners Guide to Improving Retention |

How to Calculate (And Lower!) Your Customer Churn Rate | Wordstream

Customer Churn: Definition, Rate, Calculation, Analysis, and Prediction |

Customer service: churn rate by industry US 2020 |