Accurately and efficiently measuring the value of public relations efforts has been a struggle for the industry since it began. Advertising value equivalency or AVE was PR's first attempt to prove the return on investment in PR in the pre-digital era. Fortunately, there is now advanced PR analytics software available so today’s brands and agencies can ditch outdated metrics like AVE and focus on the PR metrics that drive value to optimize strategy and prove the impact of earned media mentions.
What is the Difference between Ad Value Equivalency & Value Driven PR Metrics?
To answer this question, it is helpful to ask another. Why are you reporting advertising value equivalency? Is it because you want prove the advertising dollars you saved the marketing team? Probably not. You or your clients are more likely investing in PR because you want the audience to do some particular thing. Perhaps it is to buy something, or to fill out a lead form on your website. Perhaps you want them to share your content or visit your website to learn more about your company. These activities form the basis of your value driven PR metrics in the world of digital media. To get executive buy in, PR professionals need to be able to show how their efforts are impacting metrics like:
- Revenue Generated
- Lead volume
- Lead quality
- Website activity
- Social engagement
- Change in Sentiment
- Competitive Benchmarking
Why are Value Driven PR Metrics More Important than Advertising Value Equivelancy?
There’s an old saying that goes, “I know half of my marketing budget is wasted, I just don’t know which half.” For marketing, that ambiguity is no longer acceptable as modern CMOs are able to be extremely precise about how spend results in returns. Business leaders are starting to demand that same precision from PR. Today’s data-driven decision makers are not content to simply accept that a high ad value equivalency number or lots of press is good and leave it at that. They want to connect PR efforts to results that matter to the business. They require a demonstrable ROI, and thus the need to move beyond advertising value equivalency and the for demand value drive PR metrics.
PR professionals and agencies should not be intimidated by this sift away from AVE. In fact, it should be welcomed as a way to bring credibility to an industry that has been considered too nebulous and “fluffy” by some. Talking about impressions and ad value equivalency might not capture the attention of the CIO, CFO or Executive Leadership Team, but talking about revenue generated from media mentions certainly will. Value driven PR metrics are a way to ensure continued investment in the most effective PR activities.
Traditional PR Metrics
The importance of value driven PR metrics does not mean that the traditional ways of tracking PR results are no longer useful. These measures, which track outputs, rather than outcomes, are still helpful in measuring the overall health of your PR efforts and spotting trends and outliers. These standard media metrics include:
- Advertising Value Equivalency (AVE): Here is one traditional PR metric that you can safely ignore all together. Advertising Value Equivalency (AVE) is a metric that falsely assumes that every PR mention is worth the same as if that space were taken instead by a paid advertisement. In other words if you are mentioned in a paragraph that takes 2 column inches, and a 2 column inch ad in that publication would have cost $3,000, your PR mention is worth $3,000. It’s easy math, but completely misleading. The value of PR and paid advertising vary greatly. People tend to put more trust in earned media than paid ads, so AVE has the potential to undervalue the impact of PR. On the other hand, a passing mention, or even a negative one, might be less valuable than a well done ad, so you might be overselling PR’s impact. In short, AVE can be safely removed from the PR metrics you track.
- Mentions: The mentions metric is simply the raw number of times your brand has been mentioned in a certain time period. Although a mention in itself does not necessarily deliver any value, understanding how frequently your brand is part of the conversation gives you an idea of how effective you have been at getting your messages into the hands of authors and influencers. It is useful to know how your number of mentions is trending over time and also important to understand how certain activities or news impacts the frequency with which you are referenced.
Share of Voice: A view of your brand’s mentions as compared to those of your competitors. Again, it does not directly produce value, but provides some insight into the success of your message and those of your competitors.
- Audience: A standard PR metric is the number of people connected to your brand. This could include website visitors, Facebook fans, Twitter followers, blog subscribers, and people who have opted in to receive email. By itself, the size of your audience has no inherent value, but tracking its growth over time will serve as a tell-tail sign that you are doing the right things.
- Impressions: Impressions are perhaps the most dubious of the traditional PR metrics. Impressions count the number of times someone has an opportunity to view your message. Some PR pros mistakenly equate impressions and awareness. Impressions have the potential to generate awareness, but only a fraction do. If your brand is mentioned in an article on the first page of the Wall Street Journal, and 2.4 million people read the Wall Street Journal, you have 2.4 million impressions. What does that tell you? It tells you that a lot of people had the opportunity to gain awareness about your brand, but it does not tell you whether or not a single person did. So like the other standard metrics, impressions are lovely, but only as an indicator of promise, not one of results.
Understanding the impact and investment return for your PR efforts does not have to be a challenge. If you start at the end by understanding what you are trying to accomplish, then track both those results and the activities that drive them, you’ll be in a good position to calculate, communicate and improve your results.