The purpose of this blog is to get behind the data stories we encounter. Understandably, most commercial data is sensitive and remains unpublished. This means I have to rely on publicly available mangling of the data to illustrate the points.
The article of 11th October 2018 carries the snappy title, “Profits slide at big six energy firms as 1.4m customers switch” (The 3 types of data are explained here)
I will stick to the problems with data and not make this a critique af the article, for its weaknesses alone. That is just churlish. Read the following and think of yourself being presented with a document like this and having to critique its worth as something to base your decision-making on.
This article encompasses the Type 3 data example so very well! It appears that the journalist has started with an idea and then worked backwards to mangle what Type 1 data they have to fit the idea they want to transmit to the reader. To be clear: this post is not written an opinion piece about the Guardian, but a critique of an article purporting to use Type 1 data to support the ‘Sliding Profits’ hypothesis.
Before we go any further the Golden Rule of data has been broken. You simply mustn’t decide the answer, and then try to manipulate, mangle and torture the data to fit your conclusion. You must be led by the data, not the other way round. It is fine to start with a hypothesis and then test the data to see if that is true. It is a major credibility red flag when the conclusion is actually the initially assumed answer.
If the article is apparently a business article it is rather worrying when the journalist obviously doesn’t know the difference between profit margins and profit¹. These are two distinctly different ideas yet they are used interchangeably in the piece. Red flag number two (if the first wasn’t enough). Paragraph five manages to combine the margin’s of two companies with the profits of another and then – completely randomly – plugs in (excuse the pun) an apparently random reference to a merger and the Competition Commission.
Terms like the ‘Big Six’ are used but nowhere does the author bother to say who the Big Six are. Whilst it is a moderately common term it cannot be assumed that everyone knows who they are. This is sloppy reportage and another Red Flag for the reader. Sloppy here, sloppy elsewhere. Who knows? This is back to the Type 3 issue of how it is presented to you. In this case, so far, very poorly.
The energy market regulator, Ofgem, is cited as the source for the first graphic. The Y (vertical) axis is numbered with no qualification, the date and document that this is taken from isn’t mentioned. Type 1 data being mangled by the Type 3 data. Overall – poor sourcing and not worth the bother. You can dismiss graphics like this as you can reasonably assume it is a form of visual semiotic designed to elicit a feeling and not communicate any reliable Type 1 data to you. (Note the profits and profit margins even being conflated in the graphic title!)
The final critique is the one that speaks to the concept of Type 3 data. The language used in the article is such a blatant attempt to skew the article away from reportage about how the entrant of challengers into the market place are affecting the profits, and profit margins, of the established players. I think the subsidiary point is about the fact that consumers aren’t switching suppliers as much as is expected. I had to read the article several times to distil those as the most likely objectives of the piece.
Finally, if you re-read the article and just look at the tone and, more specifically, the adjectives used you’ll be surprised. What I can’t work out is the author’s agenda. To just report such a muddle of data is one thing, most popular press has an agenda of some kind.
NB: I really hope the Guardian doesn’t just keep gifting such poorly written articles. I think I may look at the coconut oil debate next!
1 – Gartenstein, Devra. “Profit Vs. Profit Margin.” Small Business – Chron.com, http://smallbusiness.chron.com/profit-vs-profit-margin-10684.html. Accessed 13 October 2018.