PR: It’s the inches that count
The way Kiwi organisations measure the value of PR-generated media coverage is the subject of a nationwide review being conducted this month by the CAANZ Marcomms committee and the New Zealand Marketing Association (NZMA), with agencies and clients around the country being surveyed in an effort to find out about their use of Advertising Equivalent Values (AVE) and other PR measures.
Despite the fact PR is now a $7 billion worldwide industry, it has been hindered for years by its inability to quantify the value the discipline brings to clients/businesses. One of the ways that value has been assigned to PR campaigns is by AVE, which is calculated by multiplying the advertising rate card value of the media coverage achieved by a number (usually between three and seven) that is chosen to reflect the view that editorial coverage has more resonance with consumers than paid for advertising space. This formula has been used globally for more than 40 years.
Chair of the CAANZ Marcomms committee, Claudia Macdonald, says there are two reasons for the survey: “Unlike other countries around the world, New Zealand currently has no agreed number by which AVE figures are arrived at. We think it’s important to get agreement on that multiplier so that PR-generated media coverage can be judged on a level playing field.”
The two associations are also hoping to stimulate debate on the use of AVEs and the best way to measure PR and demonstrate its value.
“Worldwide the move is away from AVE but while it still exists as a measure, we want to agree a national standard for CAANZ members and provide everyone, from clients to awards judges, with a uniform assessment tool . . . In addition to CAANZ members, we’re pleased to be canvassing industry views through our valued relationship with the Marketing Association.”
The survey can be filled out on the NZMA’s website and the results are expected to be released in April.
Duncan Stuart
March 12, 2010
One way to measure PR better is for PR companies to stop thinking they can do research and running their own godawful research. They do this to keep their hands on the budget – but they only have themselves to blame for this legacy of poor measurement.
Specific objectives (a change instakeholder behaviours for example, or a lift in the reputational assessment of the client firm) are all quite measurable.
But good researchers will do a better job at this than will specialist PR people.
Mark
March 12, 2010
But then someone running a research company would say that! ;-)
There is a lot of shonky research out there – from PR companies, marketing companies and, heaven forbid, research companies too.
Duncan's point stands though – you've got to measure the right things in order to be able to direct your focus for changes and measure the impact of what you do. If what you measure is crap, then understanding the impact of any changes you make is going to be a hard task.
In defense of PR companies – not all of the research they do is bad: and many of them do in fact work with research partners to conduct the research and ensure it is sound and statistically valid.
Peter
March 12, 2010
The value of PR is in the content. I regularly see requests for rate cards from PR companies who want to work out their AVEs from our website. When I ask them how they work it out the answer is usually what is outlined above (para2) with the 3 multiple being more common online.
However, I often wonder if looking at Google's adword prices would be more effective when measuring online value. Especially considering the quantity of referrals Google make.
If you take the keywords that a client would use in a Google, or search based advertising campaign, and find the PPC campaign average then multiply by the number of views an article received you might see a more accurate picture.
This is all assuming you can find out the coverage an article received.
I would be happy to supply data on the 30,000 or so press releases published on our site to help with this research. I would be most interested to see how much value a PR analyst would give to those articles.
Mark
March 12, 2010
The whole question of calculating generated coverage as an measure of PR effectiveness is to take a pretty simplistic view of PR in any case. How, for instance, would you measure the value of keeping a client OUT of the media – which can, believe me, be every bit as important sometimes as getting them into it.
I think an obsessive focus on measurability in one area is quasi-suicidal for PR agencies and their clients – before you know it your services will be valued by a kind of cost-per-click model that completely misses measuring the actual value provided to the client – in areas such as strategic advice, messaging and a whole bunch more. And you'll be measured by how many old-school press-releases you churn out, and how many clicks they generate. Beware!
Peter
March 12, 2010
Very True Mark. PR is so much more than just press releases.
Peter Heath
November 26, 2010
Great points all round – Duncan, Mark and Peter have nailed it, in my view: http://www.prblog.co.nz/?p=291
Why would a PR consultancy choose to divert potential fee into proper measurement and evaluation?
The answer is self-explanatory; what you lose on fee you get back many times over by way of customer satisfaction, loyalty, and proof that the client’s investment in PR is delivering exactly the type of long-term change that good PR is best able to deliver.
In the words of one client: “I like that you’re testing yourself with money you could be paying yourself!”
But most importantly, you de-commoditise your service. The discussion moves away from how to achieve a bigger and bigger bang for a smaller and smaller buck – and towards “what else needs to be done to consolidate the change we’re seeing in the way people react and interact with us?”
Personally I think CAANZ should be concentrating its energies on burying AVEs, not prolonging their suffering, and helping its PR members understand how best to measure and evaluate something meaningful instead. Like outcomes!
Stephen Knightly
April 4, 2011
See: PRWeek Awards No Longer Accepts AVEs As Critieria Changes.
http://www.prweek.com/uk/news/1061347/PRWeek-Awards-no-longer-accepts-AVEs-critieria-changes
"The move reflects the growing industry consensus that AVEs are outdated and insufficient."