Data Science For Wineries: Part IV — Math… What Is It Good For?
I can still remember it like it was yesterday… There I was, staring aimlessly at the second hand creep around the clock face, only half listening as my high school algebra teacher waxed poetic while frenetically scribbling numbers on the board. She spoke with so much passion about this group of numbers and how to calculate their average. The only thought going through my head in that moment: when in my life am I EVER going to use this?
I hate to break it to you young Nathan, but the answer to your question is CONSTANTLY. One more thing, would you please shower more regularly? I’m begging you buddy, for the both of us…
Today, let’s dip our toe into the world of statistics and see just how powerful that math you filed away in the back of your head really is. We’ve all been told time and time again that data is the key to unlocking the next level of strategic performance for your winery; but what does that really mean? It starts with understanding some basic statistics, like averages, medians, and modes. These might sound like math class flashbacks, but they’re actually your new best friends when it comes to making sense of all those sales numbers.
The Power of the Average
Let’s start with the average, also known as the mean. Imagine you’ve got sales data from the past year. By adding up all the units sold and dividing by the number of months, you get the average sales per month. Do the same thing over the course of a month, then divide by the number of days to get the average sales per day. These numbers tell you how much wine you usually sell and can be a solid foundation for planning your production and marketing strategies.
Example:
Why It Matters:
If your average sales are increasing year over year, that’s a good sign your business is growing. Conversely, if they’re dropping, it might be time to rethink your strategy.
Finding the Middle Ground: The Median
Next up is the median. This is the middle value of your sales numbers when you line them all up from smallest to largest. The median is especially useful when you have months with wildly different sales numbers. Unlike the average, it isn’t skewed by extremely high or low sales months, giving you a more accurate picture of typical sales.
Example:
Why It Matters:
If your average sales are much higher than your median, it could mean a few blockbuster months are skewing your perception of business as usual. Very similar to how our tasting room visitation might dramatically dip during a rainy winter, then spike back up during summer tourist season.
Mode: Your Bestseller Revealed
The mode is the most frequently occurring value in your dataset. In terms of wine sales, the mode can tell you which wine type or product is your consistent top-seller.
Example:
Why It Matters:
Knowing your best-selling wine helps you focus your marketing efforts and production plans on what your customers love most. If we could only take a step back in time and watch our Pinot Noir vs Merlot sales starting in October of 2004… Those 6 little words, exasperatedly screamed by Paul Giamatti, created one of the largest mode shifts we’ve seen in recent history.
Bringing It All Together
By using these basic statistical tools, you can get a clearer picture of your winery’s performance. It’s about turning numbers into insights, helping you make informed decisions that drive growth and efficiency.
So the next time you find yourself staring at a spreadsheet full of numbers, remember your high school algebra teacher and smile. With these insights, you’re not just looking at numbers; you’re unlocking the secrets to your winery’s success.
Cheers to data-driven decisions and to bringing out the best in your winery!
