Be careful with correlation

Part of measuring success is correlating activities with results.  If X happens, and we get Y result, we can make an argument as to whether or not X was a good idea.  However, we have to be careful.  When we mistakenly correlate the result with the wrong cause, conclusions are completely wrong.

All companies do things wrong.  However, we often look at successful companies and draw the conclusion that all of their tactical moves are inherently correct.  They’re doing well, so it must be because all of the things they’re doing are correct. So, we do what they’re doing.  Problem: that doesn’t always work.

If you’re going to correlate cause and effect, do so in a narrow and restrained way. If you’re flailing about, trying to prove a point that you’re insecure about, it’s easy to jump to wrong conclusions.

Case in point:  A marketer was hell bent on placing large, intrusive subscription ads on their website.  In an effort to justify this move, they cited successful companies that are doing the same thing.  The correlation they made:  company X is successful, and it must be because of the ads on their website.  The problem: these things might have absoutely nothing to do with each other.  Without the right kind of data to back it up (and this particular person didn’t have that data - just a far-fetched correlation), wrong conclusions are drawn. When you make actions based on those wrong conclusion, you’re in serious danger.

Be careful with correlation - make sure that the result you’re seeing is really due to the action you’re proposing it’s caused by.  Don’t use incorrectly drawn conclusions to support your poorly researched ideas.

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Posted Thursday, July 30th, 2009 under Business, Marketing, strategy.

One comment so far

  1. Great point which transcends so many things. Also, thank you for standing up to another silly marketer that wants to plaster the web with intrusive advertising. Successful companies that do so are successful IN SPITE of that tactic, not because of it.

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