Over the last few weeks, you may have noticed a new report named Lifetime Value (BETA) available under the Audience section in Google Analytics. This report is a good first step in the process of helping marketers easily understand how valuable their users are to their business based on the different methods of acquisition. In order to access this new report, simply log in to Google Analytics, navigate to your view, open reports, and select Audience > Lifetime Value (BETA).
First, lets talk about the time elements that are available in the report. The Acquisition date range is set to view the date range of when your users were acquired. Of all the views I’ve checked, it looks like March 1, 2017, is the earliest this range can start. This selection establishes the group of users that you’ll analyze in the report. The second time element available appears in the x-axis of the graph that shows how the cumulative metric values change over time. The lifetime value is currently calculated from a maximum of 90 days. In the graph, you can plot this 90 day timeframe in three different increments: Day, Week, or Month.
Next, I’ll share how the metrics are calculated. This report presents the data as the cumulative average value per user per the time increment you are using (day, week, month). Lifetime value is calculated using the cumulative sum of the metric value divided by the total number of users acquired during the acquisition date range. For example, if you acquired 100 users during the acquisition date range, then Sessions Per User is calculated as follows:
|Header||Day 0||Day 1||Day 2|
|Cumulative sessions per day||100||200||300|
|Sessions Per User||100 sessions / 100 users =
1 session per user
|200 sessions / 100 users =
2 sessions per user
|300 sessions / 100 users =
3 sessions per user
In the report you can select which lifetime value metric best suits your business. You can view one, or compare any two, of the following seven metrics:
- Goal Completions Per User (LTV) – Up to 90 days of cumulative Goal Completions for a user, starting from the date you acquired the user.
- Pageviews Per User (LTV) – Up to 90 days of cumulative Pageviews for a user, starting from the date you acquired the user.
- Revenue Per User (LTV) – Up to 90 days of cumulative Revenue for a user, starting from the date you acquired the user.
- Session Duration Per User (LTV) – Up to 90 days of cumulative Session Duration for a user, starting from the date you acquired the user.
- Sessions Per User (LTV) – Up to 90 days of cumulative Sessions for a user, starting from the date you acquired the user.
- Tenure – The number of users who have reached a specific age with your business, calculated from the date of the first session to the current date, and measured in days, weeks, or months. For example, if a user’s first session was January 1, and today is January 28, then that user’s tenure is 28 days, 4 weeks, or 1 month.
- Transactions Per User (LTV) – Up to 90 days of cumulative Transactions for a user, starting from the date you acquired the user.
Finally, you can view these metric values in the table at the bottom of the report page by selecting various dimensions. Acquisition Channel is set as the default upon loading the report, but you can also select any of the following: Acquisition Source, Acquisition Medium, Acquisition Campaign. The table will display the number of Users you acquired during your set Acquisition Date Range as well as additional aspects of the metric you have chosen.
While the metrics provided in this new report are inclusive for most types of online businesses, they still aren’t providing a lifetime value of users across multiple devices and/or browsers. Regardless, we should be excited about Google Analytics expanding its reports and features. Understanding the lifetime value of a user, broken down by acquisition type, will help marketers build more effective and efficient cost models in order to acquire new business.