Data Visualization 101: Leveraging Color Psychology for Effective Dashboards & Reports

This article explores the psychology of color and its applications in data visualization.

Iwa Sanjaya
Microsoft Power BI
6 min readJun 19, 2024

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Cover Image by Author

Foreword

Color psychology helps us understand the impact colors have on us and how we can leverage that knowledge in different situations (data visualization in this context). It is the study of how colors affect human behavior, emotions, and perceptions. It explores how different hues can trigger certain emotional responses in us, and how these responses can be influenced by various factors like age, cultural background, and even context. Here are some of the key aspects:

  • Colors and emotions: Different colors are associated with different emotions. For instance, red might evoke feelings of excitement or passion, while blue can promote feelings of calmness and peace.
  • Cultural influences: Color meanings can vary across cultures. For example, white symbolizes purity and new beginnings in many Western cultures, but signifies mourning in some Eastern cultures.
  • Physiological effects: Studies suggest colors can even influence our physiology. Red might raise your heart rate, while green has a calming effect.

Far beyond aesthetics, color psychology in data visualization guides color choices for charts and report themes. This ensures effective communication of insights to your audience or stakeholders. Understanding their background is key to selecting impactful colors.

Part 1: The Power of Gray

I’ve discussed about the importance of gray for data visualization in this article. In essence, gray provides a foundation, guides the viewer’s attention, and ensures clarity without detracting from the story your data tells. Here’s the recap:

  • De-emphasizing elements: Gray is a neutral color that doesn’t compete for attention. This makes it ideal for less important elements like gridlines, backgrounds, or data points you don’t want to highlight. By using gray for these elements, you allow colored data to stand out and draw the viewer’s eye to the most crucial aspects of the visualization.
Incorporating Gray for Less Important Data Points to Allow Colored Data to Stand Out (Image by Author)
  • Providing context: Lighter shades of gray can be used to display background information or context data that helps viewers understand the bigger picture. This can be helpful for showing trends or baselines without overwhelming the viewer with color.
Incorporating Gray to Display Background Information or Context Data (Image by Author)
  • Creating hierarchy: By using different shades of gray, you can create a visual hierarchy within your data visualization. For example, a darker shade of gray might be used for chart labels, while a lighter shade might be used for gridlines. This helps viewers distinguish between the different elements and understand the information structure.
Incorporating Different Shades of Gray to Create Hierarchy (Image by Author)
  • Reducing eye strain: Using too much color, especially bright colors, can cause eye strain for viewers who spend a lot of time looking at data visualizations. Gray provides a neutral resting point for the eyes, making the overall visualization less fatiguing to look at.
Incorporating Gray to Help Neutralize Overly Bright Colors, Reducing Eye Strain (Image by Author)
  • Subtle separation: Lighter shades of gray can be used to subtly separate different sections of a dashboard or report. This helps viewers navigate the information and understand how different pieces of data relate to each other.
Incorporating gray to separate different sections in dashboard layout (Image by Author)

Part 2: The Industry Colors

Towergate Insurance analyzed the logos of 520 companies to understand their color preferences and the potential emotional responses those colors might evoke. Their findings suggest that the same color can trigger different reactions depending on the industry. For example, blue is a popular choice in the communication industry, where it aims to convey a sense of clear communication and mental focus. In contrast, the pharmaceutical industry often uses blue to signify well-being, leveraging its association with cleanliness and health. This research offers valuable insights when choosing theme colors for your reports or dashboards, particularly when working outside of specific brand guidelines. By tailoring the color palette to the relevant industry, you can ensure your reports or dashboards maintain relevance and resonate with your audience.

Useful Tip: For specific brands, use their official color codes when designing reports or dashboards to ensure brand consistency. You can typically find these colors on their official websites or by searching online. Additionally, paying attention to their brand guidelines is crucial to avoid violating their logo or color usage policies.

Official MacDonald’s Color Codes (usbrandcolors.com)

Leveraging color psychology, I chose blue as the theme color for my #DataDNA May 2024 challenge report on agent performance in the communication industry (technical support). The reason was because it is often associated with:

  • Trust and Reliability: Blue evokes a sense of calmness and stability, making it a great choice for conveying trust and reliability in communication.
  • Clear Communication and Focus: Blue is linked to mental clarity and focus, making it ideal for promoting clear communication and promoting a message that is easy to understand.
  • Professionalism and Credibility: The association with trust and clarity translates into a sense of professionalism and credibility for the communicator or brand.
  • Security and Peace: Blue can also create a sense of security and peace of mind, which can be beneficial in communication settings where users might be feeling anxious or unsure.
#DataDNA May 2024 Challenge — Agent Performance Report 2024 (Image by Author)

Part 3: Common Color Perception in Data Visualization

Across cultures, certain colors tend to evoke common perceptions. Here are some examples:

  • Red is often associated with strong emotions like love, passion, anger, and danger.
  • Blue is frequently linked to feelings of calmness, peace, trust, and sadness.
  • Green is generally perceived as representing nature, growth, harmony, and sometimes envy.
  • Yellow is commonly seen as evoking happiness, optimism, energy, and sometimes caution.
  • Black is typically associated with power, sophistication, formality, and mourning (in some cultures).
The Associations Commonly Brought to Mind by Colors (source: canva.com)
The Logo Color Choices of Top Companies (source: canva.com)

However, it is important to note that color meaning can vary depending on context. For example, red might symbolize good luck in some Eastern cultures, while white is used for mourning in some parts of Asia. This principle applies equally to data visualization. Here, colors like red often represent negative values or decreasing trends, while green typically indicates positive values or increasing trends. However, this convention isn’t universal, because colors can have different meanings depending on the specific context.

A rising stock price, illustrated by the chart below, indicates positive news for the company and its stakeholders.

Annual Percentage Change in NVIDIA Stock Price from 2015 to 2024 (source: macrotrends.net)

Another example highlights how rising oil prices translate to bad news for consumers reading this report. That’s why a red color indicates a positive value here – it signifies a negative impact on consumers.

Average Annual Brent Crude Oil Price from 2006 to 2024 (source: statista.com)

Thank you for reading!

I hope this case study provided valuable insights. If you have any questions, feel free to reach out.

For those interested in exploring more data storytelling and data visualization content, I consistently create such content on my Patreon page.

I’ve also included a downloadable PDF version of the content for easy reference.

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Iwa Sanjaya
Microsoft Power BI

A data storyteller, making complex data approachable for non-data savvy.