Forest for the trees

Working on the internet for far too long has given me a good education in interpreting data.

One of the interesting things in working in data-heavy industries is the sheer amount of data points that are made available for analysis. In our work, for a single client in an e-commerce niche, we will realistically have millions of data points at our fingertips. Every time a cursor moves, a credit card is entered, a product is purchased, an advertisement is seen, an advertisement is clicked, all of this is logged and painstakingly analyzed — for potentially every one of a million different users.

It’s not difficult to gather this data. Everyone does it.

What is extremely difficult is interpreting this data in a way that makes any material impact on future decision-making.

One of the first things to do when you’re looking at vast swathes of information is pulling back on your time horizon. A classic rookie mistake is looking at today’s data, or yesterday’s data, without any context from the surrounding weeks, or months, or ideally years. Natural variation and seasonality doesn’t hit “evenly”. It hits one day worse — or better — than others, usually for no specific reason. That’s why when we are looking at year-over-year data whenever possible: comparing a 30-day swathe from this April to the same 30-day swathe from last April, for example.

The longer timeframe, the more data in general, the closer you’ll be to the truth.

But this isn’t really about marketing. This is about trajectory.

In marketing, we’re really concerned about trajectory more than anything else. We want to know if we’re heading up or down.

Applying this long-term, trajectory-focused analytical approach to anything is a clever way of assessing the quality of almost any entity, situation, or individual.

Perhaps there’s one bad day. Or one bad decision. Or even one very bad week, or one tragically terrible decision. That doesn’t indicate quality, usually, because given enough data points, something is going to be bad.

What does indicate quality is consistency and intent and trajectory.

For example, a very good person can make a single bad decision. Every single good person in history has made a bad decision at some point.

But a quality person does not make continual and consistent bad decisions. Continual and consistent bad decisions will inevitably result in an inflection point where the trajectory of their lives is directly affected by the stream of decisions they are making.

To put it another way, a quality person can make a single bad decision to punch someone, get arrested, and suffer the consequences for a few months. It’s regrettable, but it’s understandable. But a quality person will not keep punching people. If he keeps making violent decisions, he will quickly get arrested more and more often, staying in jail longer and longer, alienating more and more people, until finally after enough punches and imprisonments, he will find himself on the low point of a dark trajectory without any friends, any family, no money, no prospects, and a sore jaw.

Someone who is good with money can make a bad investment and lose some money — it happens. But we have all known that one person who is just terrible with money, the sort of person who, despite making a large income and being generally intelligent, just can’t manage to keep afloat.

You can fix a single bad decision, but at some point it’s not the bad decisions, but bad judgment. It’s far more difficult to make someone wise. The fellow who makes good money, but buys a boat here, a TV there, loads up his credit cards here, yet still keeps a stream of cocktails and appetizers coming on a conveyor belt, you can’t fix where his net worth ends up.

Pull back. Zoom out. Look at the pattern.

Visualize someone’s path as a line on a graph (a business, an individual, a society, it doesn’t matter). Perhaps this line has ups and downs, but is the slant in the right direction? Which decisions are they making which influence their direction over the coming years — and do these decisions drag the line down, or push the line up?

This is as good an indication of quality — at least for those of us looking from the outside — as you will ever find.

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