A Tale of Two Charts
Let’s say you operate a business that relies heavily on “word of mouth” – customers recommending your product/service to their friends and colleagues. Or at least, you THINK it relies heavily on that sort of thing.
You need to decide how much to spend on traditional advertising – to supplement the social/viral marketing that your customers do on your behalf. Take a look at each of these two charts – the captions for each attempt to capture the knee-jerk conclusions you might draw:
“Advertising? We Don’t Need No Stinking Advertising!
That is SO Yesterday! We’re Viral Baby!”
“All These Youngsters and Their ‘Viral This’ and ‘Social Media That’ – That’s All Just Fancy Excuses to Be Lazy – You Clearly Need to BRING Your Message to the Customer”
If chart 1 reflected reality, you may opt to spend very little on traditional advertising. But in a chart 2 world, you’d be silly to rely on viral growth. But which one (if either of them) describes your situation?
It’s a very different kind of problem from what I normally do in PowerPivot – this isn’t about analyzing data I already have, but about calculating future outcomes based on a handful of parameters. And that leads to some different kinds of thinking, as you will see.