Beyond the mean.
WHAT AN AVERAGE DOES
Summarises many values into one.
WHAT IT HIDES
The spread beneath it.
WHY THAT MATTERS
An average order value of a certain figure may mean most orders are near it, or that a few very large orders pull it up.
Those require completely different responses.
WHAT TO LOOK AT INSTEAD
- The median: the middle value, less affected by extremes
- The range: highest and lowest
- The distribution: how values are spread
THE MEDIAN POINT
For anything with occasional large values, the median describes typical experience better.
WHAT TO CHECK
Whether a few records dominate the total.
Frequently a small proportion of customers or products accounts for most of it.
WHAT THAT TELLS YOU
Where to concentrate attention.
WHAT TO AVOID
Decisions based on an average without examining the spread.
WHAT TO DO
Look at the underlying values, at least once.
