Part 2. MM4XL Tools > 3. Charts and Maps > Smart Mapping > How to Interpret Normalized Smart Mapping

Smart Mapping

How to Interpret Normalized Smart Mapping

When a Quadrant type other than the Common bubble chart is selected Smart Mapping produces a normalized chart split into four quadrants.

Bubble Maps Software for Scatter Plot and Circle Charts

One item, say a product, located in the upper right quadrant, called A, has high values on both variables. Items in quadrant B have high values for X and low values for Y, while items in quadrant C have low values for both variables. Quadrant D items have low values for X and high values for Y. The meaning of the quadrants depends only on the variables included in the analysis.

In our example, sales growth and unit price have been plotted. In the upper right quadrant are products with a high price that won sales over the past year. Below and to the left, are low priced products, which lost sales. Analysts with experience can find reasons to back up each products position within each quadrant, and can provide input to management based on facts, rather than beliefs and intuition. Normalized values are obtained, subtracting from each value its mean:

Bubble Maps Software for Scatter Plot and Circle Charts

With this computation, the axes of the chart cross always at (0,0), x=0 and y=0, and the points stand out in terms of over- and under-representation against the average. One item placed at (0,0), the origin of the map the point where the 2 axis cross themselves has values on both variables which correspond exactly to the mean value of both variables. Thinking of products, Smart Mapping can help to:

  • identify groups of competitors that perform in a similar manner
  • look at the spread of sales among products
  • search for free and interesting market opportunities
  • find relationships and association among variables

Only the ingenuity of the analyst can limit the ways of applying normalized Smart Mapping. A Smart Mapping analysis can be run in a dynamic, static or hybrid context, with either absolute or indexed figures. The way the analyst treats the raw data makes the difference. Static valuesare computed at one moment in time, for example, the price in March 2000 or total sales in 1999. Dynamic valuesare computed over two or more different periods of time, for example, the increase in price between 1996 and 1999 or the market share growth between May 1999 and January 2000.

Bubble Maps Software for Scatter Plot and Circle Charts

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