Every chart type, and how to read it
Nine exhibit types, what each is best for, and the question to ask when you see it.
Key takeaways
- Each chart type is built to answer one kind of question. Recognize the type, and you know which question to ask of it.
- A Marimekko chart shows each segment as a column.
- A waterfall starts at one total, shows each step up or down, and ends at the new total.
Key idea
Each chart type is built to answer one kind of question. Recognize the type, and you know which question to ask of it.
| Type | Best for | How to read it | Watch out for |
|---|---|---|---|
| Bar | Comparing items | Find the biggest and smallest, and the gap between them | An axis that does not start at zero |
| Stacked bar | Parts of a total | Read the total first, then which part changed | Middle parts are hard to compare by eye; read the numbers |
| Line | Change over time | Direction, speed, and turning points | Uneven time gaps between points |
| Waterfall | How one number became another | Start, each step up or down, end | Which bars are totals and which are changes |
| Marimekko | Market size and share together | Column width is segment size; height inside is each player's share | Reading share as absolute size |
| Scatter | Relationship between two measures | Look for a pattern and for outliers | A pattern does not prove one thing causes the other |
| Table | Exact numbers | Pick the rows and columns that answer your question | Units in the header and footnotes |
| Dual axis | Two measures with different units | Check which line belongs to which axis | Two scales can make a link look stronger than it is |
| Log scale | Numbers that grow very fast | Equal steps mean equal percentage growth | Big real differences look small |
So-what
Before any math, say what kind of chart it is and what question it answers.
Reading a waterfall
Waterfall chart: Operating profit bridge, last year to this year. Values in USD millions. Last year, total: 50; Price, change: +8; Volume, change: -5; Costs, change: -13; This year, total: 40.
So-what
Costs took away the most profit (13 million), more than price increases added. Look at costs first.
In the waterfall above, what is the net change in profit from last year to this year, in USD millions? (Use a minus sign for a fall.)
Reading a Marimekko (shown here as a table)
A Marimekko chart shows each segment as a column. The width of the column is the size of the segment, and the blocks inside show each company's share of that segment. To find a company's sales in a segment, multiply the segment size by its share. Here is the same information as a table.
Worked case
Home appliances in Saudi Arabia: size and share by segment
The prompt
The home appliance market in Saudi Arabia has three segments: premium (SAR 400 million, our share 30 percent), mid-range (SAR 800 million, our share 10 percent), and budget (SAR 800 million, our share 5 percent). What are our sales and overall share?
The structure
- Our sales = sum over segments of segment size x our share
- Sales in each segment
- Total sales and overall share
The exhibit
| Segment | Segment size | Our share |
|---|---|---|
| Premium | 400 | 30% |
| Mid-range | 800 | 10% |
| Budget | 800 | 5% |
Working it through
1. Premium sales
400 times 30 percent.
Premium sales (SAR millions):400 × 0.3 = 1202. Mid-range sales
800 times 10 percent.
Mid-range sales (SAR millions):800 × 0.1 = 803. Budget sales
800 times 5 percent.
Budget sales (SAR millions):800 × 0.05 = 404. Overall share
Total sales 240 out of a market of 2,000.
Overall share (percent):(120 + 80 + 40) ÷ (400 + 800 + 800) × 100 = 12
The recommendation
We should focus growth on the mid-range and budget segments, because they hold 80 percent of the market but give us only SAR 120 million of our SAR 240 million in sales. First, our overall share is only 12 percent, and premium, at a 30 percent share, already gives half our sales. Second, one point of share in mid-range is worth SAR 8 million, twice a point in premium. The risk is that moving into cheaper segments weakens the premium brand. As a next step, find out why our mid-range share is only 10 percent: product, price or distribution.
Scatter: each dot is one item (for example one store), placed by two measures such as size and profit. Look for the pattern and the dots far from it. Dual axis: two lines with two different scales, one on the left and one on the right. Always check which axis each line uses. Log scale: each step on the axis is the same percentage, not the same amount, so a line that looks straight means steady percentage growth.
Which chart best shows how last year's profit became this year's profit?
In a Marimekko chart, what does the width of a column show?
A scatter plot shows that stores with more staff have higher sales. What can you say?
Sources for this lesson (1)
- Recognized public explanations of case-interview concepts and frameworks
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