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You Can't Quantify Everything
Measuring, or Not, the Value of PR
Eric Webber |
I almost missed it because I'm building up immunity to claims of the latest, most definitive systems for measuring such things. They seem to be everywhere, like golf magazines that trumpet yet another cure for the slice in every issue. Or Cosmo's monthly "greatest sex tip you'll ever read." I've never been helped appreciably by either of them, by the way.
I'm not saying there's nothing to any of the claims. In fact, I try as much as anyone to quantify what I can. But it's rarely very easy or accurate, especially in the PR business, where measurement is even murkier than on the ad side.
And I think we (on the agency side) are putting ourselves into difficult positions by not pushing back some on the notion that everything must be quantifiable. Clients need to back off their "quantify everything" mantra and accept that intuition and gut feeling are a form of measurement, too.
Are we are so fearful of losing business that we'll spend time and effort searching for some formula to placate a client, when what we really need to do is to reach a better understanding about what is and isn't measurable? And why the hard-to-measure things are still very important even though they are, well, hard to measure?
We're in the storytelling business, so I'll tell you a story that I think serves as a good case in terms of the difficulty of measuring value. It's also, I think, an interesting example of how success can (or can't) be measured, depending on which side you're on.
Town for sale
One of my partners, Bryan, has a friend who owns a town. Sort of a town, anyway, out in the Texas Hill Country. Albert, Texas. Founded in 1880 by a man who was later killed in a shootout.
Besides that very Texas-y history, there's a house, a tavern, a 100-year-old dance hall, peach and pecan orchards, a creek and the elementary school where President Lyndon B. Johnson attended the first grade.
The friend wanted to sell the town, and thought a little publicity would find a buyer for the unique parcel.
"Put it on eBay," said Bryan.
"Who would buy a town on eBay?" asked the owner.
"No one," I told him. But imagine the headlines. "Historic Town for Sale on EBay." I could work with that.
And sure enough, starting with the Associated Press, the story took off. The wire story led to requests for interviews from across the U.S. and several other countries. TV stations picked it up, and not just in Texas.
We placed a few web stories, but eBay enthusiasts did most of the work in that medium, spreading the story to hundreds of sites.
The expense side of the ledger was ridiculously small. A few hours of time and less than $50 in eBay fees.
And what about the other side? What was it worth? You could use the simplest methods, like the old chestnut of taking the advertising space equivalent and multiplying it by some variable that's supposed to represent the third-party endorsement power of editorial over paid space. Even using a conservative multiplier, it would mean that we generated somewhere around $2 million worth of publicity.
But here's where it gets tricky. No one bought the town. So where I might fairly claim that the work resulted in $2 million worth of PR value, the owner could counter that it was worth nothing. He's right where he started.
Between $0 and $2,000,000. That's a pretty imprecise measurement.
Yeah, I know, I'm oversimplifying. There are other factors, like maybe the price was too high. Or the handful of buyers for a unique product like this don't like peaches. Or LBJ.
I'm only trying to make a point: We can create whatever matrices or formulas or paradigms or whatever, but we can't get away from the fact that this is a sometimes ambiguous business when it comes to measuring value, and we shouldn't be afraid of that.
So I'm turning to you, dear readers, to help out and offer up what you think. Was this particular case ultimately a success or failure? And what was the value? Tell me, please, how much you think I'm really worth. No, wait. You can skip that last part. Discuss amongst yourselves and get back to me.
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Interesting to be sure.
Weighing the costs and benefits of ideas before implementing them is what clients pay for in Public Relations. Unlike advertising, publicity does not entail media costs. It is accurately gauged by non-paid media responses and direct business responses that are qualitative and quantifiable by the client, just as your effort did.
In your case, the PR effort did indeed gain a publicity response but not a direct sale. The value of the free publicity may be $2MM but it is an arbitrary figure because you cannot control the media response, only influence it if you are very good at this.
The media did more to scoff at the Town, then to promote its sale by persuading anyone to buy it. Obviously the town has more value today then it did prior to the effort. Cost factors in this case overlook your time, not just the $50 ebay expense.
Generally evaluation criteria should be established prior to the project with the client not after the fact – because you can concoct any evaluation you want to justify your effort. Public Relations has traditionally relied on effects, not on results.
Value on educating buyers, developing a market, and using non-paid media to tell the Town's story does have an objective outcome to assist in its sale, which it did. But you didn't persuade anyone to buy it.
Perhaps that is the difference between Advertising and Public Relations: the ability of each to persuade. You got Publicity, but didn't get the sale. Now Advertising could develop upon that by creating a persuasive advert to close the deal. This is why integrated marketing communications is always the best choice for business, as it brings the power of all marketing communication tools to make the sale.
Public Relations has a reputation for taking the ambiguous and giving it form, and for changing impressions and attitudes in an almost imperceptible way, advertising too – but one has a bigger price tag then with the other. I'd say your partner's friend owes you a commission when the sale occurs. Much of Public Relations is separating the subjective from the objective, and objectively speaking, Public Relations does know what it is doing and how to evaluate its worth. They prepare and establish evaluation criteria prior to the effort, not after the fact.
Great post. I've been an Internet marketing for 15 years, and even I agree with you!
The issue with an unyielding focus on measurement is that it creates a "digital marketing is inherently better because we can keep score" mentality.
The Internet isn't magic. It's great at fulfilling demand, but it can't create demand by itself. I just wrote a blog post about that:
"The Alarming Truth about Digital Marketing's Imperfections"
http://is.gd/Ste
The other problem with measurement is that it by definition diminishes willingness to try new tactics that might in fact be fantastically effective. TV wasn't initially measurable. Radio wasn't initially measurable. Outdoor is only sketchily measurable today. And social media is only barely measurable, and that's pretty fuzzy.
Jason Baer
Convince & Convert
Internet consulting and training for advertising and PR agencies
www.convinceandconvert.com
A few years ago, I was asked to give a seminar on creative copywriting to a graduate level creative writing class at FSU. To illustrate the point that good advertising creates "buzz", I used an amusing commercial for a popular brand of beer an example.
The professor for this course asked me if the commercial made me want to buy the beer. Being the beer snob that I am, I replied that I wouldn't use that particular brew for carb cleaner. He then commented snidely, "Then the commercial failed."
I've often thought about that comment. Is the barometer of success for an advertisement really that absolute? Absolutely not.
To be equally simple and succinct (on a subject that could be discussed for MONTHS) the purpose of advertising is to make the potential customer AWARE of the opportunity to procure this product or service. Even the best advertising rarely closes the deal.
Your tactics were successful.
But I want everyone reading this comment to think about the television shows that they watched less than 24 hours ago and tell me a commercial (besides a political ad) that they can recall. My guess is that not many consumers can remember one product ad they saw. Or take last Sunday night's football game on NBC. The game scored an 11.2 rating with 18.3 million viewers. Can anyone recall an ad they saw? But I'll bet that on Monday morning some agency called their client who ran a spot during the game and bragged about what a great decision they made to spend over a million dollars for a 30 second spot.
Now, I agree that businesses need to advertise. And there is value to hiring an agency. But businesses need to spend their money wisely. If we simplify advertising we can break it down into a few key variables.... Reaching the target audience, product awareness/capture attention, "what can the product do for me", and where can I buy it. An advertiser should use the most cost effective media to accomplish these goals.
For example, I run a fleet graphics company that displays ads on the sides of huge tractor trailers. Each trailer will be seen by 60,000 consumers daily (15 million annually) with a 97% recall rate (at least that's what the research shows for those people interested in metrics). Ask yourself, what is more visible, a 53' billboard crossing directly in front of your windshield or a 42" screen from fifteen feet away. What's more cost effective, a CPM rate of $1.00 for the fleet graphic ad or $20 for the TV commercial. Which one never stops being seen 24 hours a day and which one ends in 30 seconds. And before the critics talk about target market, I'm not suggesting that fleet graphics should be used for all products. My point is, the clients have been persuaded to choose the TV commercial because the metrics used by agencies lean that way. The agency will also choose the commercial because their cut is much bigger. So is the agency really working in the best interest of the client.
My suggestion is that before "the company" spends millions of dollars on ads, push aside the metrics for just a minute and use good old common sense to see if your money is being spent wisely.
Doug Sartain multimediaalternatives.com
Too often I have heard from public relations professionals that they view their charge as generating visibility or awareness. However, such visibility is not in itself a contributor to achievement of a client's business objectives. Visibility can be generated with no real impact on a client's business.
As has been identified here, those in PR frequently cite that there are many variables impacting sales that are beyond their control. But if a client has such significant obstacles that they impede purchase, they in reality should address the fundamentals of their business before investing in marketing and promotion. In most cases, however, the obstacles or challenges that exist are the very issues that PR professionals should be accounting for in development of their brand communications platform. This is ultimately our function. Generation of visibility is only half the job. It is the message that is delivered to establish relevance and drive consumers to purchase consideration through that visibility that is the most important aspect.
The public relations industry has long complained of its inability to transcend perception as a service function and its difficulty in building greater value among the business community. Acceptance of our true value can only occur once we demonstrate that we view our responsibility as generating sales, not just coverage.
It is the accomplishment of business objectives that clients ultimately look to achieve through investment in public relations. Absent of this, their investment is not an efficient or effective expenditure.
The function of PR is to achieve business objectives on behalf of clients. Therefore, we must accept the responsibility that achieving these objectives is the only measurement that has any real meaning.
Bill Daddi
We exist and get hired by clients to put them in a position to win... to create commerce. Yes you created awareness. Was it qualified awareness, maybe.. maybe not. At the end of the day, as you said the town isn't sold. But as you correctly say, who knows if it was the fault of the "campaign" or some other variable.
I echo your concern that clients are getting too metric centric. I just saw an email where a client is quantifying the purchase of a single ad on how many dinners need to show up at the restaurant. Overkill.
In the end, if client/agency both are truly committed (and the client believes the agency is committed) to the goal of creating commerce, then the metric issue usually works itself out.
Cool idea though and great post.
Tom Martin
www.tommartin.typepad.com
It's funny because, as we all know, the debates over quantitative versus qualitative metrics are nothing new, and the respective challenges have forced all of us within this wild and wooly media landscape to reevaluate what to emphasize, where and when. As a WOM agency, we're naturally predisposed to focus on the value of brand engagement, although we always try to tie our efforts to promotional drivers such as DM or DR. In many cases, we can show strong correlates between engagement and sales. That said, like many digital shops, our social media monitoring capabilities are deepening, which seems to widen the gap between quantitative and qualitative analytics on some levels with respect to concept of ROI – something that takes on the notion of "Return On Intent" rather than "Investment".
So, I offer this opinion: consumers are already helping us close this gap with their influencer behavior, and more importantly, their ability to collaborate in creating branded content and in developing product.
At the end of the day, this could mean that we land in an entirely new area of measurement that puts the long-standing arguments to rest.
Best,
Gunther Sonnenfeld
DEI Worldwide
Albert Einstein
CMO, E=MC2 Marketing
But, I think my CFO would call your example an ROI = 0% and NPV = -$50. Not a big deal on a $50 working spend (didn't include the PR agencies fees)... but if I want my budget to be higher than a couple hundred dollars next year I better be prepared to "sing for my supper" and show tangible value.
Most of us in the marketing and communication businesses create fiction, make promises, and spin ideas daily using words and images. We are being asked to add numbers to that offering. We are asked to "account" and value the efforts and spending.
On Wall Street, most forward looking financial statements, all budgets, and every single financial model is a work of fiction. Just ask an economist or "quant" that manages credit swaps, or calculates yields on sub-prime mortgages, what the "true" ROI or yield will be, or was historically, according to certain FASB rulings or "mark-to-market" estimates.
What is fundamental to Wall Street is a language, process, and system which forms an agreement on the value and return of a financial transaction. As we know from daily news reports about the mortgage meltdown, none of the numbers used were reflective of reality.
Too many marketers seem to think that there are too many variable, so nothing can or should be measured and valued. Or as Eric Webber asks us: what is the value of the buzz when no transaction occurred? It reminds me of the value of Paris Hilton's fame and how she earned it. It is real and tangible. (BTW, ask your CFO why brand value is an intangible asset).
Let's embrace measurement as a new services offering and add a new silo: Chief Economics Officer. This is a billable job with reports and fancy portfolio media and integration management models which describe multiple actions and outcomes, not just a one number ROI. Though Albert TX was not sold, it did jet on the media map, and its ROI could be measured in merchandising and licensing rights rather than media yield.
As Mark Twain said: there are lies, damn lies, and statistics. Let's add them to our bag.