(This post is a re-purposing of a speech I gave to the FPRA/PRSA-Orlando on July 23, 2009. You can download the slides here.)
Public relations measurement is at a crossroads. Old techniques are no longer sufficient. Old metrics are no longer applicable. Old thinking must be replaced by new. The need for accountability, and to prove the value of PR and social media programs, has never been greater.
As we look to the next year, here are five things to forget and five things to learn about public relations measurement in 2010.
Things to Forget in 2010
1. Media Relations Focus
A focus on media relations fails to capture several important aspects of PR – brand, reputation, crisis, employee communication and DTC to name a few. Also, the importance of traditional media is declining. Numerous studies have shown people don’t trust what they read in the media, they trust each other. I believe it was Hauser and Katz who coined the term ‘you are what you measure’ in 1998. If measurement is focused on media relations that is how the public relations function will be judged.
The need to put PR results in a business context has never been greater. We need to be able to address the question – what are we doing to help drive the business? If you are focused on output metrics like impressions or message delivery, you will always have a hard time explaining business impact. Instead, we need to focus on outcomes and answer the question – what happened as a result of our program or coverage? Understanding outputs has primary benefit as a diagnostic tool rather than a ‘scorecard’.
3. Impressions (and Multipliers!)
The most common PR metric today is Impressions. While it is a somewhat dubious metric for traditional media, it really loses meaning in social media where engagement not eyeballs is what we seek. Impressions also (greatly) overstate actual relevant audience. Generally only a fraction of any particular magazine or newspaper’s circulation meets your target audience demographics. And impressions merely represent an opportunity to see, they do not attempt to estimate the (small) percentage of the potential audience that actually saw your content. To compound the problems, many PR practitioners use a multiplier on impression numbers to account for pass-along readership or a mythical credibility advantage PR has over other communication tools. The simple fact is there is no factual basis (e.g. research proof) that multipliers should be used in any case.
4. Ad Equivalency (AVEs)
There are many reasons why using ad equivalency as a proxy for PR value is not advisable. Here are five good reasons they should be avoided:
- AVE calculations vary and there are no standards. Tonality, article length, competitive mentions and other factors are handled differently.
- AVE results can be misleading. AVEs may be trending up while metrics like message communication, share of favorable positioning and share of positive press are falling.
- AVEs reduce PR to just the media dimension by only assigning a value in this area.
- AVEs only apply to traditional media. What is the AVE of a positive conversation about your company on a leading blog?
- How much is it worth for a troubled company to not appear in the Wall Street Journal? AVEs cannot address this.
5. Return on (Engagement/Influence/etc.)
Not a day goes by on Twitter without someone declaring a new and improved metric for the acronym ROI, or stating that ROI does not apply in social networks. Wrong and wrong. Most of these folks either don’t understand ROI or don’t know how to obtain the data necessary to calculate it. There is also a lot of confusion between creating value and ROI. Generating awareness creates value, for example, but may not immediately result in demonstrable ROI.
Things to Learn in 2010
1. Total Value of PR
The majority of current PR measurement efforts focus on marketing/sales and output metrics. The Total Value Cube is a way to visualize and think about all the potential value your PR and social media efforts deliver. Beyond marketing to include brand and reputation, beyond outputs to include engagement, influence and action, and beyond revenue generation to include cost savings and cost avoidance.
2. A New Model for Measurement
Many public relations practitioners regularly get their Outputs confused with their Outtakes or Outcomes. Outtakes is not often used in the U.S. – it seems much more prevalent in Europe. The overall terminology is confusing and is defined in different ways by different practitioners. Further compounding the confusion is the fact audiences we present our results to rarely understand the terms and have trouble relating to them. In short, the terms are too much ‘inside baseball’.
What we need is a metrics taxonomy that is easier to understand and explain. I like this one.
Exposure – to what degree have we created exposure to content and message?
Engagement – who, how and where are people interacting/engaging with our content?
Influence – the degree to which exposure and engagement have influenced perceptions and attitudes
Action – as a result of the PR/social media effort, what actions if any has the target taken?”
3. Three Zones of Measurement
From the left, companies or brands control, own or manage websites – corporate sites, FaceBook pages, Twitter accounts, LinkedIn pages and blogs by way of example – and create content that consumers may engage with. This zone is measured primarily by web analytics. In the middle are the actual social networks and conversations between individuals. In this zone we are interested in data sets that cannot be gathered solely using web analytics packages. How often is the brand being mentioned in conversation? What is the sentiment of the comments? How often is the brand being recommended and by whom? Content and behavior analysis, including tracking technologies, are the primary measurement tools in this zone. The third zone represents all the real-world, offline transactions that may be of interest. Did someone visit the store or attend or event? Did they buy a product? Did they recommend the brand or product to a friend over coffee? Primary audience research is necessary to address many of the questions, as well as scan or other purchase data in some cases.
Your measurement strategy should be to take a holistic, integrated approach using methodologies, tools and data from all three zones. The Holy Grail in many ways is to be able to track behavior of individuals across all three zones, cross-platform, understanding how online behavior impacts offline behavior and vice-versa.
4. New Metrics
5. The Difference Between Impact/Value and ROI
ROI is a form of value/impact, but not all value takes form of ROI. ROI is a financial metric – percentage of dollars returned for a given investment/cost. The dollars may be revenue generated, dollars saved or spending avoided. ROI is transactional. ROI lives on the income statement in business terms.
Value is created when people become aware of us, engage with our content or brand ambassadors, are influenced by this engagement, and take some action like recommending to a friend or buying our product. Value creation occurs over time, not at a point in time. Value creation is process-oriented. Value lives on the balance sheet.
Your investments in social media or public relations remain an investment, creating additional value if done correctly, until which time they can be linked to a business outcome transaction that results in ROI.