Bubble Charts – Introduction & Overview
Assume, you have a table with 3 related dimensions of data. Then, how do you represent it on a flat 2D chart? Is it by Placing three column charts side by side, one for each dimension?. Or use two XY-plot charts?. However, the earlier mentioned approaches will be very ineffective in putting together all the 3 parameters in a single elegant visualization chart. Therefore, It is Time to address the issue with the world of charts.
What are bubble charts?
The charts plot the given data which is defined in terms of three distinct numeric parameters. They allow the comparison of entities. Also, when it comes to their relative positions with respect to each numeric axis and their size as well.
Usually, Column charts and line charts have only 2 axes – a numeric axis and a categorical axis. The Y-Axis is the numeric axis for column and collection charts. So, this means that the quantitative magnitude of the plot is indicated by the position of the plot with respect to the Y-axis. Further, they are different because both axes of a bubble chart are numeric. Hence, the positioning of the bubble plot is an indicator of two numeric values. The area of the bubble plot (or the scatter blot bubble size) can be an indicator of the magnitude of the third numeric characteristic.
Use case of Charts
The bubble graphs are used to help you manage your investments in equities better. The X-axis and the Y-axis are used to denote the Age of Investment and Return on Investment respectively. Apart from these 2 parameters, what is the 3rd parameter that you would be interested in? Obviously, how much possess you invested in particular equity? So that is denoted by the area of the bubble plot. Quite clearly, Here A has the largest RoI and the largest investment size as well.
But, you could have made that out from the data desk itself. How did the bubble graph help you? Since we have taken up a very basic example, only 5 investments have been shown here. But in reality, the number of investments will become much higher. In that case, the bubble chart will help you form a mental visualization of all the data available to us.
4 quadrants of Chart of Bubble
Usually, they are divided into 4 quadrants. Depending on the parameters, each of the quadrants has a particular meaning for you.
Quadrant 1 – Best investments
Here, we can see the Investments that have given high RoI in a short period of time. What else could you ask for? These investments are like jackpots to your portfolio.
Quadrant 2 – Good investments
Long Age group of Investment but great RoI. If you are planning to make further investments, you would surely invest in the equities in this quadrant.
Quadrant 3 – Not-so-good investments
Low RoI over a long period of time. Further investment on equities in this quadrant would be your last bet.
Quadrant 4 – Decent investments
Manageable RoI over a short span of time. The stocks/ sectors in this quadrant may be suitable for short-term investment.
Therefore, With a larger number of data plots, mental divisions like this are very helpful in determining the next course of action.
Variants of the bubble chart
What we have discussed until now are only single-series charts. But, You can also have multiple series of data plotted in the bubble chart. The series will then have different colors with the legend pointing out which color refers to which data series of charts.
In our Equities Investments as an example, we can also show Mutual Funds in the same bubble chart.
They are great for custom charting. Using it such as this, you can view all your investments at once. Then you can decide which investments you should pump more money in and which ones should you divest further.
Where can it be used?
Aside from using it for finance & investments, there are a whole lot of other places where it can be used. Some examples to stir up your imagination:
1. To see if higher promotional expenses lead to more purchase and in turn to more revenue for a bunch of retail stores in a month
The X-Axis can have the average daily purchase of football, Y-Axis the promotional expenditures and the region of the plot will display the revenue generated by the outlet for that month. This can help to locate promos failed & find a store that was able to promote itself successfully.
2. Checking if higher CPC leads to higher clicks and better conversions in PPC Campaigns
To check if your excess spending on increasing the CPC to get better ad positions are getting you more clicks and finally leading to even more conversions, a bubble chart will end up being useful.
3. Better Presentation of Word Graphs
It is a great way to compare the impact of different keywords, tags or hashtags. Examples can be identifying the most shared hashtags in the entertainment industry for 2018, Tags with a maximum number of visitors, etc.
Bubble charts are a variation of scatter charts. Here, the data points are replaced with bubbles. Further, An additional dimension of the data can also be represented in the size of the bubbles.