Roundtable Series: PR ROI
There are many ways to measure the return on investment (ROI) for a Public Relations campaign. It is not an easy task but a worthy one, and PR deserves to be measured properly and accurately to ensure optimum efficiency and effectiveness.
Whether you measure the amount of coverage or the realisation of your objectives, the future of PR resides in effectively measuring its ROI, especially with PR campaigns moving towards the realm of social media and digital PR.
The first step to effectively measure the ROI of a PR campaign (be it traditional or social media) is to answer the fundamental question of: What is it we want to change, improve, accomplish, incite, etc.? Basically defining your objectives in relation to your business activities:
- Customer management
- Raising brand awareness
- Corporate Social Responsibility
- Improving product sales
- Event coordination
- Increasing traffic on your website
- Increasing inbound links
- Voting, polls and surveys
- Reduction in costs and processes
- Decrease in customer issues
- Lead generation
- Reducing sale cycles
Next you need to look into a framework for measuring metrics. For traditional media, the most commonly used benchmark to measure ROI is the ‘Advertising Value Equivalent’ (AVE). This is done by measuring the space taken up by an article and relating it to the cost of purchasing an advertisement of those dimensions. Of course, you multiply the actual cost of the advertisement to get your AVE, because an editorial dialogue carries much more influence and credibility than a ‘silent’ advertisement.
There are however many ways to measure the value of PR. Here is a non exhaustive list of questions that will help you define it:
- Clipping: How many articles did you get? What where their tone? Were they positive, negative, neutral? Was your mention prominent? Dominant? In the article?
- Are you mentioned on equal footings with your competitors? Are you measuring well in independent comparisons?
- Have you asked your prospect or customer the source of their info?
- Can you measure the difference in demand before and after a PR campaign?
- How many additional hits did your website achieve during your campaign? What was the percentage of those hits that turned into inquiries? Into sales?
- Has the perception of your brand changed after the PR campaign? Did you know what it was before?
- Did you receive any industry awards? How did it impact your invitations to speak at events?
- Do you know the acquisition cost of leads? Can you correlate with their source?
- What is your cost of reach (cost per thousand, CPT or CPM in the online world)?
- Do you know your net promoter effect? i.e., how many people would recommend you?
- Can you correlate with business outcomes: did your target buy more?
- Can you invest in econometrics modeling? Do you have access to the information you need to do so? (yes, that age old tool can save the day)
During the fourth instalment of EASTWEST PR’s Roundtable Series, Frederic Moraillon said: “basically, a news article is estimated to have three times more impact compared to an advertisement, but it is still based on the flawed concept that equates advertising and public relations. Advertising is a pure commercial message aimed to sway its target directly. PR will create different interpretations and its results are not as straightforward, so it is much more complicated to evaluate. Furthermore, an article can stay online forever, and every time there is a crisis people will go back to it. AVE is not a true gauge of the impact of PR, it’s just a number on paper as there is no actual cash return.”
One of the other participants, Sarah Myers, account executive at Media Monitors, added that “while AVEs are a quick and dirty way to justify budget, I don’t think it can be very effective”. She also added that you need to also take into consideration the context of the article, (whether your competitors are mentioned and the demographics of the readers) and evaluate it against your business objectives and primary target audiences.
According to Herald Bangras, a senior lecturer at Ngee Ann Polytechnic, “when we look at PR we are looking at it from so many different angles. It’s very hard to put a dollar value to something that is so relative. What is the value for not being featured in any media? Sometimes there is value for not being featured in the media. You do not want everything that you’re doing, or some things that you are not doing, to come out in the media. I think the role of the PR agency there is to advise your clients that they don’t need to get into the media, so instead of organising something large scale, you should do something smaller.”
Erin Walsh, Executive Vice President, Asia Pacific & Japan at The Planet Group Ltd, said: “in this world of communication, it is also interesting to make a distinction between public relation and private relation. When you’re speaking about word-of-mouth it is not public relation. Today, little businesses and majority of the service industry want to focus on private relations, because sometimes being too much in PR is not necessarily a good thing. A lot of businesses that are doing well don’t do any PR they do private relations. They do articles that are very targeted. They invite people and spend time with them. Time is money, so you can’t exactly put a value on it and measure the ROI but at the end of the day, they are doing very well because everybody is talking about them. I think in Asia, this is one of the very important cultural differences, where people want to have a personal relation much more than a public relation.”
As for social media, there have been significant advances in recent years in the technology for monitoring online content. Free tools include Google Analytics, SocialMention, and even YouTube has invented their own means of tracking where your viewers come from. But if you require more in-dept information (such as the demographics of your readers, sentiment analysis), you will probably need to opt for a paid service like Media Monitors.
PR ROI is a given to measure any PR campaign. The question is not about when or why, but how to get it done and doing it effectively.