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This approach is simple to calculate but does not take customer behavior into account or changes over time, either in customers' preferences or company strategy. A cohort is a group of customers that share a characteristic or set of characteristics.

By examining cohorts instead of individual users, companies can get a picture of the variations that exist over the course of an entire relationship with groups of customers.

Changes to any of these strategies, as well as any shifts in a company's customer base as a whole, in the future will prevent companies from depending on past CLVs to predict upcoming ones.