August 12, 2015

Data beats Opinion

In case you are not familiar with the film, Moneyball , it relates to the world of baseball. It tells the true story of how the Oakland A’s General Manager Billy Beane used computer analysis and statistics to rebuild his team for the 2002 season. It is an intriguing David and Goliath story of how a team struggles to compete while under enormous financial constraints. Moneyball tells the story of what happens when a team is up against competitors with far deeper pockets? The Oakland A’s who had the third lowest payroll in the league overcame huge obstacles and triumphed over clubs that had the luxury of selecting the top tier players.

The narrative follows the story of how when Oakland lost its first team line-up, the team was left scrambling for replacements. Rather than going down the route of traditional recruitment methods and battling their competitors head-on, Beane (Brad Pitt) placed his trust in a new assistant (Jonah Hill) who would crunch the numbers and have an in-depth look at statistics to determine the game’s most undervalued players…..

Against all advice, he assembled a team of cranks and rejects that no one thought could succeed–including his own manager (Philip Seymour Hoffman) who constantly challenged and opposed Beane. It was not an overnight success and early results for the Oakland A’s were far from impressive. However the value gradually became evident as the team trounced the much more fancied teams.

To quote Google, the moral of this story is that “Data beats opinion”. You may have opinions on the layout of your site. You may have opinions on what your customers want and where these customers come from. You may have opinions on what product categories should be most visible on your site. However our opinions stem from our beliefs which are not always in tune with reality.

Harvard psychologist David Perkins calls this “The makes sense rule”*. We take a position, look for evidence to support this and then stop thinking. The danger is we can disregard salient facts because they do not fit the narrative that we have in our heads. We can see this in politics all the time where we believe that everyone else is swayed by some type of ideology but not ourselves. We are completely impartial and rational. You can see this in the business sense all the time when companies make terrible decisions that alienate their fans and customers.

A far better way would be to let the data tell its own story. After all, the data does not come out of thin air. This data is reflective of the opinions of your audience. These are the people who will spend money on your site so it is imperative that their needs and wishes are catered for. This is the most successful way for resonating with your audience. Use data to understand what they want and then give it to them.

*Perkins, D. N., Farady, M., & Bushy, B. (1991). Everyday reasoning and the roots of intelligence. In J.F. Voss, D.N. Perkins & J.W. Segal (Eds.), Informal reasoning and education (pp. 83 – 105) Hilldale, NJ: Erlbaum.

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