An Average ProblemOct 03, 2023
In our data-driven world, averages often take centre stage.
Online businesses run on averages like:
- Average order value
- Average click through rate
- Average return on ad spend
Averages are neat, convenient, and seemingly reliable. They distill complex data into a single, manageable figure that can be easily communicated and understood.
But averages blur the unique narratives of outliers. The peaks and troughs get flattened into a single average score.
Imagine a sales team where one member consistently shatters sales records, while another struggles to meet targets. The team's "average" performance may look solid, but it conceals the fact that one salesperson might be on the brink of burnout, while the other is in need of training.
This is the problem with averages. They eliminate the nuances and subtleties that are crucial for making decisions.
They’re a useful shortcut and a decent place to start.
But to understand what’s really happening, look beyond the average.