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@JessieC Is this all in excel or alteryx. I tried doing this but I'm getting an error #REF!. Can you please explain how did you manage to get that result in your template excel file? I didn't understand the steps that well. ..would appreciate a greater insight.
You would configure Output Data tool in Designer to write out to "Data" sheet, which is in the same workbook of your template/formatted Excel sheet that contains the dropdown menu (this Excel template is already created).
Once the "Data" sheet is created, you will open Excel workbook to update A2 to the INDIRECT formula. Do not copy the formula to the other cells/columns - it should only be the first cell.