How do you use conditional formatting to highlight key data insights?

Conditional formatting helps report viewers jump to the right point among lots of data points and save time, no matter what the visual is: table, matrix, line or bar chart. By using correct algorithm and styling, you can help users find what they want at a glance.

"Color is a power which directly influences the soul." — Wassily Kandinsky To highlight key data insights using conditional formatting, identify critical thresholds or patterns in your dataset. Apply formatting rules such as color scales, data bars, or icon sets to visually emphasize important trends or outliers. Use custom formulas for specific conditions like highlighting top or bottom values. Regularly update and refine these rules to ensure they reflect current analytical priorities, enhancing clarity and impact in data presentations.

Start by defining clear criteria and applying straightforward formatting rules that directly support your analysis goals. This approach not only simplifies the interpretation of data but also lays a solid foundation for more advanced conditional formatting techniques. By mastering the basics, you can effectively highlight critical insights and improve decision-making based on clear visual cues.

Make sure your formatting rules are all-encompassing — e.g. account for errors (can use an iferror function) — but try and keep things simple! You don’t want to overcomplicate your spreadsheet, especially if you plan to send it to colleagues who might not be so familiar with complex excel formulas. In the case that you have multiple formatting rules on a single cell, try and see if you really need all of them, and if you do, make sure you sort them by hierarchy to avoid conflicting rules.

Though you can apply out-of-the-box available rules directly on data in your report, you can define measures to do complex calculations and use results to apply conditional formatting rules. We do this in many cases, specially when dealing with tables and matrices.

Define clear criteria based on thresholds, trends, or comparisons that are critical for your analysis. Whether it's highlighting outliers, trends exceeding targets, or specific patterns, setting precise rules ensures that the most relevant information stands out visually. This approach not only enhances data interpretation but also facilitates quick decision-making by drawing attention to important insights at a glance.

Use color scales with caution! Using colors which are not compatible with your report's color theme, or cause text to be scrambled as a result of font family, size or color, can make your report hard to read. Keep in mind that color scales are meant to "highlight" point of interest, not to just show a point which cannot be read.

By applying gradient colors based on data values, you can quickly visualize trends, patterns, and variations across your dataset. This visual representation allows for immediate understanding of data distribution and comparisons. Utilizing color scales effectively enhances data interpretation and facilitates decision-making, enabling stakeholders to identify critical insights at a glance.

Data bars are very useful when data diversity is high, e.g. from 1 to 1000. In such cases you can find very small or very large values at a glance. But keep in mind that their colors should be selected in the right way.

These visual representations, scaled to reflect data values within cells, offer a quick and intuitive comparison across your dataset. Whether indicating relative sizes, progress towards goals, or trends over time, data bars provide immediate visual context that enhances understanding and decision-making. Incorporating data bars effectively in your reports or dashboards helps stakeholders grasp important insights more efficiently.

I strongly recommend using icon sets. They show difference with both color and shape and their shapes can help users to spot POI much easier. Red circles show error values, yellow triangles show warnings and green rhomboids tell us that status is OK.