This is the perfect video, if you would like
to avoid creating charts like this one.
Or perhaps this one…
And especially this one
Being able to choose the right type of chart
for the data you are working with is not an
exact science, but I’m sure you will agree
something went wrong with these examples.
One can’t be certain whether they have been
taken from a horror movie or a hippie fest.
In 99.9% of cases, we don’t want to show
this to our audience.
Charts are an opportunity.
A storytelling tool.
A chance to make a convincing argument through
visualizing data.
We are not going to convince anybody if we
choose a type of chart that is not the right
fit for the data.
To help you overcome or avoid this issue,
in this video we’ll discuss:
a) the different types of charts, and
b) the type of data they are suitable for
Bar charts
Probably the most frequently used type of
chart is the basic bar chart.
As its name suggests it is composed of a series
of bars illustrating a variable’s development.
Given that bar charts are so common, people
are generally familiar with them and can understand
them easily.
Examples like this one are straightforward
to read.
However, please be aware that bar charts can
be confusing, too.
Especially if one uses them to compare several
variables.
I personally believe that a comparison of
more than two variables with a clustered bar
chart becomes too cluttered.
Here is an example of a clustered bar chart
that is not exactly crystal clear:
This isn’t a horrible visualization, but
it leaves plenty to be desired.
First of all, it is difficult to follow the
trend of all five variables simultaneously,
isn’t it?
Moreover, it is hard to gain an idea about
the overall state of the Fiction Book Sales
market, and how it changed, which was probably
what the person who created the chart wanted
to show in the first place.
When to use bar charts
So, bar charts are nice, but limited.
We have to consider the type of data we want
to visualize and the number of variables that
will be added to the chart.
Bar charts are great when we want to track
the development of one or two variables over
time.
For example, one of the most frequent applications
of bar charts in corporate presentations is
to show how a company’s total revenues have
developed during a given period.
A bar chart can be used to make both a year-on-year
comparison, and to provide a monthly breakdown.
Moreover, bar charts can be pretty intuitive
when we compare the development of two numerical
variables over time.
Let’s say we would like to compare the revenues
of two companies in the timeframe between
2014 and 2018.
When to avoid using bar charts
Simple bar charts are far from ideal in situations
when we have several variables and all of
them are part of a whole.
Such as the case In the Fiction Book Sales
chart we showed you, there were five categories:
Young adult; classics; mystery; romance; and
Sci-fi.
All of which account for all fiction books.
Meaning, their sum gives us the total volume
of the Fiction book sales market.
Do we get any of this information with this
bar chart?
We don’t.
It simply shows us multiple lines and one
has to start making calculations on their
own to understand how numbers developed over
time.
And if they have to do that, why bother creating
a chart?
We are better off showing the data in a table
format, right?
So, this certainly is one case where we should
use a different type of chart.
Along the same lines, a simple bar chart isn’t
suitable when we have a single period breakdown
of a variable.
If I want to portray the main business lines
that contributed to a company’s revenues
in 2018, I wouldn’t use a bar chart.
Instead, I’d create a pie chart or one of
its variations.
Pie charts
A pie chart is a circular graph divided into
slices.
The larger a slice is, the bigger portion
of the total quantity it represents.
When to use a pie chart
So, pie charts are best suited to depict sections
of a whole.
What does that mean?
If a company operates three separate divisions,
at year end its top management would be interested
in seeing what portion of total revenue each
division accounted for.
A pie chart is perfect in this case.
However, we need to be certain that the sum
of the proportions makes 100% of the total.
That is, we cannot afford to forget any of
the three divisions contributing to total
revenue.
When to avoid pie charts
Obviously, we can’t use a pie chart in situations
when we would like to show how a variable
(or multiple variables) develops over time.
Pie charts are a definite no-go in these cases.
Moreover, as mentioned earlier, a pie chart
would be misleading if we don’t consider
all values.
In the context of our example from earlier,
we shouldn’t create a pie chart that includes
revenue of only two of the firm’s three
divisions.
Doughnut charts
Doughnut charts are basically pie charts with
a hole in the middle.
(It is as if their heart is missing…)
When to use doughnut charts
The use cases of pie and doughnut charts are
identical.
The only important difference is that doughnut
charts allow us to indicate the total amount
by adding a text box in the middle.
If you use a pie chart, you will have to include
the total amount elsewhere (like adding it
to the title).
When to avoid using doughnut charts
We already explained when to avoid using pie
charts.
The same is valid for doughnut charts.
One piece of advice when choosing whether
to include a pie or a doughnut chart would
be to think of your audience.
How likely is it they would be interested
in seeing the total figure for breakdown you
are providing?
If the split itself is more important, then
go ahead and use a pie chart.
If the value of the total is important too,
then perhaps a doughnut chart would be preferable.
Moreover, some studies have shown that people
tend to get a distorted idea when shown pie
charts, as larger portions can look even more
so because they cover more space.
With doughnut charts this isn’t as much
of an issue.
Line charts
A line chart is, as one can easily imagine,
a line or multiple lines showing how single,
or multiple variables develop over time.
It is a great tool because we can easily highlight
the magnitude of change of one or more variables
over a period.
When to use line charts
Remember the awkward Fiction book sales chart
we saw earlier?
Well, a simple line chart would have been
way better in that case.
A line chart allows us to track the development
of several variables at the same time.
It is very easy to understand, and the reader
doesn’t feel overwhelmed.
When to avoid line charts
Line charts are not that great in situations
when you want to show how the individual parts
of a whole change over time.
Yes, in theory one could use a stacked line
chart (where line values accumulate) or a
100% stacked line chart (where lines accumulate
to 100%), but a stacked area chart would look
better.
Area charts
Area charts are very similar to line charts.
In fact, at first, I wanted to show them together.
However, one major confusion could have arisen.
So, please pay attention.
The idea of an area chart is based on the
line chart.
Coloured regions (areas) show us the development
of each variable over time.
There are three types of area charts: regular
area chart, stacked area chart, and 100% stacked
area chart.
When to use an area chart
Whenever we want to show how the parts of
a whole change over time, we should consider
an area chart.
So, for example, if the company has three
revenue generating divisions, it is very likely
that management would like to see the development
of each of these divisions.
This is a great way to draw attention to the
total value and still emphasize an important
trend – say, revenues from one division
have been growing rapidly while the other
two have kept the same level.
A stacked area chart is perfect in this case.
However, if we are interested in the portion
of revenue generated by each division and
not that much of the total amount of revenues,
we can simply use a 100% stacked area chart.
This will show each division’s percentage
contribution over time.
When to avoid area charts
Obviously, similarly to line charts, area
charts are not suitable for representing parts
of a whole over a single period.
In our example, we can’t use an area chart
to show the proportion of revenues each division
generated in say, 2018 alone.
So that’s a situation where we can’t use
an area chart.
In general, I would stay away from the classical
area chart too.
It can be very confusing and even Microsoft
themselves recommend avoiding it and to consider
using a simple line chart.
If we wanted to show the development of revenues
generated by each of the firm’s divisions
over time with a simple area chart, we would
have something looking like this.
I know.
A nightmare.
So, to recap.
Line and area charts function in a strange
symbiosis between each other:
It is recommended to use the line chart, stacked
area chart, and 100% stacked area chart;
We should avoid using: area chart, stacked
line chart, and 100%-line chart
Ok, great!
We are doing really well.
Let’s make a short pause here and in our
next video, we will discuss treemap, bridge,
scatter, and histogram charts.
Make sure you don’t miss it because it is
a great one!
