How To Calculate ARR Cohort Analysis in Odoo ERP | Arithmix

Cohort analysis is a powerful tool that can help businesses gain insights into their customer behavior and retention rates. ARR, or Annual Recurring Revenue, is a metric that measures the amount of revenue a company expects to receive from its customers on an annual basis. By combining these two concepts, businesses can perform ARR cohort analysis to better understand how their customers are contributing to their revenue over time.

What Is ARR Cohort Analysis?

ARR cohort analysis is a method of analyzing customer behavior over time by grouping them into cohorts based on the time they became customers. This allows businesses to track how revenue from each cohort changes over time and identify trends in customer behavior. For example, a business might group customers who signed up in January 2020 into one cohort and customers who signed up in February 2020 into another cohort. By comparing the revenue generated by each cohort over time, the business can identify which cohorts are contributing the most revenue and which ones are experiencing churn.

ARR cohort analysis is particularly useful for subscription-based businesses, as it allows them to track the revenue generated by each cohort of subscribers over time. This can help businesses identify which cohorts are the most profitable and which ones require more attention to prevent churn.

When Is It Valuable To Calculate ARR Cohort Analysis?

ARR cohort analysis is valuable for any business that wants to gain insights into customer behavior and retention rates. By tracking the revenue generated by each cohort over time, businesses can identify trends in customer behavior and make data-driven decisions to improve customer retention and increase revenue.

For example, if a business notices that a particular cohort is experiencing high churn rates, they can investigate the reasons why and take steps to improve the customer experience for that cohort. This might involve offering personalized incentives or improving the onboarding process for new customers.

Overall, ARR cohort analysis is a valuable tool for businesses that want to gain a deeper understanding of their customer behavior and improve their revenue over time. By tracking the revenue generated by each cohort, businesses can identify trends, make data-driven decisions, and improve customer retention rates.

How Do You Calculate ARR Cohort Analysis in Odoo ERP

Odoo ERP itself isn’t naturally geared towards letting you calculate complex metrics like ARR Cohort Analysis. As an alternative, teams typically use products like Arithmix to import data from Odoo ERP and build out dashboards.

What is Arithmix?

Arithmix is the next generation spreadsheet - a collaborative, web-based platform for working with numbers that’s powerful yet easy to use. With Arithmix you can import data from systems like Odoo ERP, combine it with data from other systems, and create calculations like ARR Cohort Analysis.

In Arithmix, data is organized into Tables and referenced by name, not by cell location like a spreadsheet, simplifying calculation creation. Data and calculations can be shared with others and re-used like building blocks, vastly streamlining analysis, model building, and reporting in a highly scalable and easy to maintain platform. Data can be edited, categorized (by dimensions) and freely pivoted. Calculations are automatically copied across a dimension - eliminating copy and paste of formulas.

Arithmix is fully collaborative, giving your entire team access to your numbers and the ability to work together seamlessly.

Calculating ARR Cohort Analysis in Arithmix

Calculating metrics like ARR Cohort Analysis is simple in Arithmix. Once you've created your free account, you’ll be able to import your Odoo ERP data, and use it to create natural language formulas for metrics like ARR Cohort Analysis.

Arithmix is designed to give you the power to build any calculations you want on top of your Odoo ERP data, while also being easy to use and collaborate on. You can share your dashboards with users inside and outside of your organisation, making it easy to empower your whole team.