1. Insights fundamentals
Now that we've established our data foundation with the CPS dataset, created a linear sequence with our analysis road map, and explored our data in the previous exercise, let's discuss how we will implement the remaining data elements in our story.
2. Our data story journey
We've actually achieved a lot thus far. You might be thinking, "how is that? I haven't done much".
Well, although we haven't produced anything tangible, we have accomplished a considerable amount of work. You might not have noticed it, because much of the work in data storytelling is prepping for it. That is, gathering requirements, data, formulating a plan, and exploring the data.
3. Data story elements left
However, we still have 3 data story elements left to deploy. As it so happens, these elements will help us craft our insights. For the remaining data story elements, that is, Dramatic Elements, Visual Anchors, and Main Point, we will learn how to deploy KPIs and data visualizations.
4. Conveying insights
Key performance indicators, or KPIs, are business defined metrics that detail one facet of an organization's performance. KPIs are incredibly useful for providing single figures to quickly convey relevant insights. For example, doctors use blood pressure as a KPI for cardiovascular health.
However, we know that images speak louder than words, and insights require context. This is where data visualizations come into play. Visualizations such as graphs and plots help us make sense of data nuance and context. This is why you may frequently see stock performance conveyed in a line graph.
5. Key performance indicators (KPIs)
To provide a KPI example, let's consider the digital marketing industry. Some common KPIs within this industry includes: Impressions (or views), Clicks, and Click-through rate
Click-through rate is the proportion of impressions or website views, that resulted in a click. So if you had 100 impressions on your website, and 50 of those resulted in a click, you have a 50% CTR. In many cases, CTR gives us the additional context we need, because impressions and clicks are baked into the formula.
6. Sales funnel KPIs
However, impressions and clicks are useful KPIs in their own right, depending on the purpose of the marketing campaign. If a brand wants to attract more leads from a certain demographic, or just want to draw awareness, impressions is a sufficient indication of that.
Prospect campaigns might seek more engagement or considerations, of which clicks are an adequate measure.
But once a customer takes a desired action like a purchase or subscription, this is called a "conversion", and clickthrough-rate (or CTR) becomes more valuable to measure campaign success.
7. KPIs vs. charts
However, we know that insights require context. A 5% CTR doesn't tell us much without it. For example, if we're selling luxury cars, a 25% CTR might be fantastic! But if we're selling car insurance, maybe not so much. Or perhaps your business is seasonal, and 10% is an exceptional CTR in the winter.
All of these factors are important, which is why visualizations or charts are used.
8. Visualizing KPIs
Visualizations allow us to use visual anchors and dramatic elements to help show insights. There are many charts to choose from, but the goal is to pick one that makes your insights accessible. It's important for the audience to easily spot the insight, and to avoid distracting chart design.
With that said, there are countless visualizations out there, but some of the more common and safe options are bar charts and line charts, depending on the context. Interactivity is an extra layer of sophistication. It's most often present in dashboards or created in BI platforms like Power BI.
9. Let's practice!
Now, let's practice using KPIs and visualizations in the next exercises.