Reimagining PR Impact: Moving Beyond ROI to Uncover True Value in Communication
In the past ten years we’ve seen transformational shifts in the way society communicates with one another. Just looking at the digital media landscape alone, newspapers have been almost cannibalised, independent news has died and come back to life multiple times, digital media is key and…. *checks notes* newsletters are making a comeback?
So, in this age of rapid change and huge technological disruptions. Isn’t it time to rethink our metrics?
ROI - the Old Guard of the PR industry
ROI or “Return on Investment. For those out of the loop, ROI is a widely used metric to assess the profitability of an investment made. Put simply, it calculates the dollar value that is generated by each dollar value invested.
In the media industry, this refers to costs from your communications strategy, and using ROI to show how much value you are creating or losing with these proactive communication efforts. Some of you may be familiar with age-old ROI metrics used in this industry, “audience impressions” “Advertising Value Equivalency” “ Clickthrough rates” “Bounce rates.” These are often used to prove that proactive media inputs have generated real monetary value. It provides a clear outcome-driven framework that can justify the strategic inputs and help make a case to… well… spend more money.
But if we only look at the quant data to tell us whether we’ve made a “return,” are we really showing the value of our activities? In the age of disruption and constantly shifting goalposts, is this traditional understanding of ROI truly aligning with core goals and objectives of our organisations? Have we become too narrow in our focus?
Take a look at some of the Australian ASX listed companies who have delivered “record breaking” profits in recent quarters, sending shareholders fantastic dividends and keeping the board happy (for so long).
Qantas is the perfect example of a company that has delivered “Return on Investment” in the conventional sense. The company emerged from a global pandemic that put the aviation industry in crisis, and saw local airline companies significantly scale back operations and make widespread staff cuts. In the aftermath, Qantas registered a record number of customer complaints, and yet simultaneously delivered one of its most profitable earnings periods in history. For all intents and purposes, Qantas delivered a return on their investments.
And yet, the company has since entered a new era of crisis, with the outgoing CEO characterised as ‘Australia’s most hated person’ by Crikey in September, the incoming CEO pleading for forgiveness on national television, and customers, staff and the general public demanding an explanation. The share price has taken a hit and the company is in damage control. Now it needs to invest significantly in longer term reputation management - a much less tangible outcome to identity and measure.
Why we need a new way forward
Perhaps Qantas would have benefitted from a wider range of success factors that considered metrics and indicators beyond the scope of profit and cost.
These days there is rightfully more emphasis on brand awareness, customer engagement, market perception and long term reputations as key indicators of “value.” There’s no denying that if an organisation successfully achieves these outcomes - success will flow on to the bottom line. And in the case of Qantas - if an organisation fails to achieve these longer term outcomes - the bottom line will inevitably take a hit.
Of course there is a cost to generating awareness of an organisation, taking up advertising space, media buying and digital marketing campaigns cost money. And these costs need to be accounted for. But these days public relations and strategic communications involve so much more than just paying for a billboard or online ad. It’s about building relationships with media, social media and influencer networks, enhancing brand preference and recognition, developing long term reputation and customer loyalty.
To truly understand the impact of these activities - should we not create a framework that goes beyond cost and profit?
Moving beyond profit to look at those objectives that lie at the heart of the organisation.
Return on Objectives (ROO) is an increasingly used metric to measure the performance and success of PR activities that focus on non-financial goals and objectives. It provides an alternative framework to assess the success of efforts in increasing brand awareness, reputation building and community engagement, things that are much more elusive and almost impossible to identify when looking at a cost versus profit ratio.
It is a murkier space, but then again, so is measuring long-term reputation.
ROO measurement frameworks rely on “zooming out” and really understanding the bigger picture and the context your company is operating within, and then “zooming” in to really understand how you performed within this context. It brings in a wider range of metrics and data points to really hone in on your performance, and the impact of your activities.
Here are some of the ways the most ahead of the game PR and communications professionals are doing it:
Qualitative analysis of your media performance
Clip counts, impressions and AVE will only tell you half of the story. Sure, you can get an idea of how much you’re being mentioned month to month, but is this not a bit of a vain approach? To really assess whether the paid, earned and owned media outputs are aligning with your organisation’s core goals, you need to look at the quality of coverage. Assessing the sentiment of this coverage, looking for evidence of proactive engagement, tracking key organisational messages - these are essential factors that demonstrate whether your media strategy has had success.
Tear down silos and Integrate data
Why are we only looking at one datapoint alone? In ROI it’s about the money, but what use is understanding the money if you have no context? You need data to provide context, and with ROO, the data-world is your oyster.
We are increasingly bringing insights and data analytics into the core of our measurement frameworks, and more and more companies have the ability to tap rich banks of data. So use it! By bringing together relevant media, social media, digital data points, survey and interview feedback - you get to really see what is driving outcomes for the organisation.
When you pull these data points together you create a much more insightful picture of how your organisation is performing across several fronts. You can more clearly grasp levels of public sentiment, awareness and perceptions around your organisation. Social media provides instant feedback on the performance of a media campaign, while digital media trends demonstrate information seeking and behavioural change. Survey data speaks directly to public opinion and brand recognition. Are these outcomes not considered valuable to an organisation? As PR professionals, let's start to leverage the value of these insights.
Stakeholder and customer feedback
The Qantas story shows where the failure to listen to their people ultimately resulted in poor outcomes. And this isn’t just your customers and your shareholders - this is the whole network of individuals and entities that your company engages with on a regular basis. Prior to the company’s share price tumbling, widespread scrutiny of the way customers and staff had been treated throughout the pandemic was dominating media headlines, social media discussions and even starting creeping into smalltalk at family get-togethers. Financial analysts concede that these have had such a reputational impact for the airline, there is likely going to be a downstream impact on profits.
These trends in customer and employee satisfaction levels were not news to Qantas, these sentiments have been bubbling away for more than twelve months now. By adopting a ROO framework and looking at stakeholder sentiment as part of the company’s organisational objectives, these reputational risks would have been identified and potentially addressed much sooner into the piece.
Some of us have been talking about ROO for years, but in the world of public relations, it’s arguably still an emerging concept. The range of metrics, performance indicators and success factors that can be incorporated into these frameworks is immense, and we need to move away from a narrow view that only centres on profit and loss to truly demonstrate the value of our activities.