The times when the ROI of PR was difficult to measure are long gone; big brands have been doing so for some time now.
Though many still consider ROI in financial terms (the amount of money totaled from public relations campaigns after subtracting the costs), many other things can be considered when calculating return on PR investment.
In the past, the main measurement criteria were the quantity of coverage, channel of delivery, and media type. Other factors included type of mention (feature or exclusive), whether competitors were also mentioned, and the credibility/popularity of the source.
Some factors could apply online as well. For example, for a tech startup, features on sites like TechCrunch, Mashable, or ReadWriteWeb have long represented the holy grail of a PR campaign. Today, tracking public relations ROI involves measuring social media ROI; measuring outcomes is the most important aspect of this equation.
What business owners must consider first when calculating PR and social media ROI is that they represent earned media, which requires ongoing management, time, and flexibility. It is not enough to conduct a campaign today with no follow-up tomorrow, unless the results desired are “flash sales.”
Also, they must understand that public relations ROI cannot be reduced to a simple accounting equation. An additional, intangible value must be considered, and this value might take a while before it becomes “cash.”
Because PR and corporate communication strategies often are employed to achieve nonfinancial objectives, there are several other metrics to consider. Here are a few:
1. Counting media placements. The main role of public relations is to reach out to the media to communicate a company’s message. Counting media placements is one way to measure the ROI, and that can be quite significant if you get massive coverage in an array of publications. Here consider how many of these mentions are mainstream or first-tier outlets (such as TechCrunch, Business Week, etc.) and how many are less popular, yet highly influential. Everything that comes after these counts as a media mention, but it weighs less in terms of ROI.
2. Assessing quality. After counting, you should consider the quality of these placements: Will they influence behavioral changes in those who read them? Will these changes have a positive impact on their attitude toward your business? Are they credible? Do they feature your company exclusively? Is the tone positive? Do they confer your message accurately?
3. Viral impact. Online media coverage extends to social media networks, with readers sharing news updates and reacting to them. There are several ways to measure these reactions beyond number of mentions. You should consider the number of influencers mentioning your brand, their tone of voice, and the sentiment of the message.
Social media metrics
1. Engagement vs. coverage. It is generally agreed that the most important aspect of social media is the quality of the conversation, and not the “coverage.” In other words, when you measure the public relations ROI on social media, you should focus on community and conversation, rather than on number of mentions. Are people really talking about your brand, and are there influencers who carry the conversation? Is the conversation affecting your brand’s social media presence?
2. Community growth. As an effect of social conversations related to a specific PR campaign, your brand should see some growth relating to its own social media presence: more Twitter followers, more Facebook “likes,” etc. Because “likes” and followers can be bought, though, to quantify community you must assess whether the people following or “liking” something are truly interested in your brand. Are they active users, conversing about issues related to your business? After they follow, do they participate in conversations on your social media channels?
1. Behavioral impact. This is perhaps the most important PR outcome to consider, because it directly reflects the success of a campaign. How many customers called to inquire about your products/services? Are more people recommending your brand than before? Are you generating more sales? Is your site receiving more traffic from a media placement, and how many of those visitors are taking an action (purchasing, calling your customer support number, etc.)?
2. Growth. As a result of everything mentioned above, in an ideal world you should see growth that doesn’t refer to flash traffic to your site. If you are not selling anything (for example, social startups) you should see more user registrations and unique user growth—or maybe more app downloads, if that’s what your business is about, or sales based on a product launch. No matter how you look at it, growth means customer/user retention and revenue growth where this metric applies. If a PR campaign doesn’t have this outcome, it has failed.
When employed properly, PR campaigns have an immediate impact and mid-term and long-term effects. These are values that can be quantified as follows.
1. Brand loyalty and advocacy. The role of PR is to increase brand awareness and generate good will toward a business. If this succeeds, it will boost brand loyalty and generate behavioral changes that turn people into brand advocates. Are people still talking about your brand long after a campaign has ended? Do they recommend you on social media, blog, forums, etc., after a purchase? Are they returning to your business for more services? For example, on social startups and apps, are they active users?
2. Cost savings. PR activities may even result in cost savings—for example, reduced customer complaints; declines in criticism or opposition; prevention of a media crisis that could damage a brand’s reputation, resulting in fewer sales, etc.
3. Better market positioning: PR may help your brand become a recognized influencer in your niche, giving you a clear advantage over competitors.
Though there is still no mathematical formula to quantify public relations ROI, the guidelines above should give you a fair idea what return on PR investment is all about. But keep in mind that for PR to function effectively you’ll have to ensure that all your departments (sales, marketing, customer support, etc.) work along the same lines. If PR paints your brand in bright colors, there will be high expectations from the public, and your business must be ready to meet them.
The way your company acts must be consistent with its PR message. Many times PR campaigns fail because customer support is faulty or because other departments were not briefed. Do not begin a PR campaign without aligning your key interests and making sure everyone is on the same page.