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Posts Tagged ‘ROI

Getting ready for a blast of papers and industry promotion on PR ROI: The vexed issue of Return on Investment got special focus on the final day of the European Summit on Measurement in Lisbon. I was the academic member of a panel of six that chewed it over.

Although there is a general view amongst practitioners that ROI must have a place in PR, mainly because some clients want to express all organisational activities as financial returns, there is debate as to whether ROI should only be expressed in a financial manner (mainly US) or whether it is applied more loosely to include intangibles (Europe).

In the US, the Council for Public Relations Firms (CPRF) is moving rapidly to offer a definition of ROI with assistance from AMEC. The aim of these organisations is that the ROI formula is adopted world-wide so that there is common language – and clients can see that PR does offer a return on investment. It may be ready by the end of this year.

I still have doubts as to whether ROI, other than in a strictly financial format, can be re-purposed into a more general expression of value creation or contribution to organisational efficiency.  Business managers understand what ROI is, so why would they accept a mixed-concept PR ROI. What’s your view?

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In a cross between crowd-sourcing and Eurovision voting, the 100+ delegates at the European Summit on Measurement in Lisbon voted for five draft statements of needs that may end up in the Measurement Agenda 2020.

This will be the next stage of international policy development in PR measurement and evaluation, following on from the seven Barcelona Declaration of Measurement Principles agreed last year.

The statements are:

  • Create and adopt global standards for social media measurement;
  • Identify how to measure the Return on Investment of PR [a crowd source suggestion];
  • Measurement of PR campaigns and programs needs to become an intrinsic part of the PR toolkit;
  • Institute a client education program such as clients insist on measurement of outputs, outcomes and business results from PR programs;
  • Define approaches that show how corporate reputation builds/creates value.

The statements will go to conference delegates in mid-July for further comment. They were chosen from statements prepared from responses to an informal survey of delegates and other practitioners undertaken in recent weeks.  The wide range of academic research on PR measurement wasn’t taken into account.

This seems to be a less-than-robust method of data collection for policy-making when, for instance, a Delphi study amongst leading practitioners could have developed the propositions with greater certainty of future application.  Perhaps Barcelona Principle 7: “Transparency and replicability are paramount to sound measurement “, should have been kept in mind.

This is a last call for your views on the use of the term, Return on Investment (ROI), in PR. I’m researching into practitioner use and understanding of ROI and will report on my findings to PR Moment’s ROI Conference in London on March 3 and at the International PR Research Conference in Miami a week later. It will also be reported on this blog.

I’ve prepared a short survey (just click through to it) which takes 10 minutes to complete. Already, early data responses are showing up some strong differences between areas of practices and on specific propositions.

As ROI is often a judgement on communication effectiveness, I hope you will take part in this very relevant study. Comments and feedback are welcome, too.

ROI or Return on Investment is a much-used public relations term. Its beginnings are in financial management but it’s less well defined in PR practice.

I’m researching into practitioner use and understanding of ROI and will report on my findings to PR Moment’s ROI Conference in February and other conferences in the coming year. I’ve prepared a short survey which will take 10 minutes to complete. It will give data and insights on which further research in the UK and other countries will be based.

As ROI is often a judgement on communication effectiveness, I hope you will take part in this very relevant study. Comments and feedback are welcome, too.

I’ve just chaired the judging of the AMEC awards for PR measurement and evaluation. I wouldn’t dare reveal the results as they won’t be announced until November 19. But I’d like to share my thoughts on the state of the PR measurement and evaluation business. Here goes:

– When media evaluation is combined with qualitative research on political and social issues, very powerful and valuable insights can be offered.

– There is growing confidence amongst evaluators with more offering well-based consultancy advice to clients. That shows growing maturity in the business.

– Compared with the 2007 AMEC awards, which I also chaired, online PR and media is now being included in many evaluation programmes. But much needs to be done on valid and reliable analysis.

– Coordinated cross-country analysis is developing, with much greater allowance for national media culture differences. For sophisticated organisations, there is less emphasis on uniform delivery of messages across greatly varying cultures.

– More debate is needed on the use of ‘Return on Investment’ as a measure. In many instances, it is strictly applied as a financial benchmark which ignores the contribution that PR makes to organisational strategy and efficiency of operations. The paper by Fraser Likely, David Rockland & Mark Weiner published on the Institute of PR website in 2006 would be a good basis for discussion.

– It’s disturbing to find organisations having prime PR objectives such as generating a volume of coverage (e.g. “1000 clips a year”) but ignoring the communication of key messages or influence on attitudes or stakeholders.

– There needs to be much greater understanding of statistical terms such as “correlation”. To imply that a distributed message is correlated with behaviour, such as product purchase, is the old problem of the “substitution game” in which outputs are presented as outcomes. If evaluators claim correlation, then they have to show the reliability and validity of their methods.

Overall, the AMEC awards when announced in November will demonstrate the growing maturity of the international PR evaluation business. There are some really interesting and challenging gold award winners, with a few of them being “great leaps forward”. You’ll just have to wait till they are announced!

Jim Nail of the US media evaluation provider TNS is arguing against the use of the three evaluation categories – Output , Out-take and Outcome – as being too generalised and non-specific. Here’s the link to his blog, http://blog.cymfony.com/2007/10/outputs-and-out.html. These terms were developed by Walter Lindenmann in the early 1990s as a neat categorisation and have been promoted through many books and industry/academic papers.

Output is the production of the public relations effort (messages sent). This is the Presentation stage and may include measurement of press releases and other communication methods

Out-takeor Out-growth is the understanding and retention of messages by publics. It looks at the attention, comprehension and acceptance.

Outcome is the effect of the PR effort on attitudes, opinions and behaviours. This measures the actions of the target groups.

There is also a more recent Out-measure, called Outflow that considers the build of value by improvements to reputation and the creation of organisational/stakeholder relations.

This group of Out-measures is convenient and, as far as I can see, widely accepted. What’s your view?


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