Fiction: PR can’t be measured – Take 2

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This is the next entry in our “Best of” series, in which we venture deep into the vault to replay blog opinion and insight that has withstood the test of time. Today’s post hails from February 2008. We welcome your feedback.

By Francis Moran

About a month ago, as part of my continuing series of Francis’s favourite fictions, I tackled the too-widely held myth that public relations can’t be measured. I described how, at inmedia, we establish a critical path, or set of outputs, for every project and ongoing program that allows our clients to certify that we’re exerting the amount of effort we said we would. This, I said, was a good starting point for program measurement, but a woefully inadequate one.

I went on to describe what we call outcomes, a set of clear and unambiguous objectives we set that tell our clients what they should expect by way of actual coverage by our target media and analysts, with more granular objectives established for specific program elements such as news releases, product launches, contributed articles, speaking programs, trade show support and so on. Applying such an approach turns the whole PR value proposition on its ear; instead of a cost centre that should be managed down to its minimum, a client can now view the PR function as an investment centre, and can answer the question, “Are these results, or outcomes, a sufficient return on the investment my PR agency or department is asking me to make?”

In my earlier post, I promised to go even further than this, to approach the holy grail of ROI measurement. What does it matter, I asked, if we achieve the outcomes we projected but the media and analyst coverage hasn’t advanced our clients’ business objectives? Or, maybe even worse since decisions then can’t be made about whether or not to continue the program, what if we can’t tell whether our clients’ business objectives are being advanced by our PR efforts?

In my practice, it is simply unacceptable that we not be able to measure the impact our PR program has on specific business objectives such as demand creation, web traffic, sales-cycle acceleration, human resources recruitment and retention, share price and, yes, even sales, revenues and profits. Let me share with you a really good case study.

We used to have a client whose managed service allowed large enterprises to inventory all their IT assets; not just desktops, laptops and servers but all peripherals, operating systems and applications, including versions and licenses. As a managed service, our client had a massive database that, in aggregate, yielded highly reliable insight into certain IT-related issues within corporate America. The company’s budget with us was very small, so our program consisted of identifying the occasional high-profile IT issue, commissioning a report that demonstrated how pervasive that issue was, and generating media coverage around it.

Big buzz, but no bang for the buck

One of our first efforts was in the wake of the Recording Industry Association of America’s announcement that it would sue not just individuals but also companies whose employees were using peer-to-peer applications to download copyrighted material. Our client’s data suggested that the use of such applications within corporate America was quite widespread, and our news release announced our client was making available a free subset of its managed service that would tell IT managers how pervasive P2P applications were within their environments.

The story went global and the market’s response was nearly overwhelming as our client had to babysit its servers to manage the demand for its little report. Huge impact on our client’s business, right?

Not so much.

While initially overjoyed, our client soon realized that very few of those who downloaded the free application were signing up as paying customers. Here was a textbook example of our level of effort, or outputs, being exactly right; the coverage results, or outcomes, being unbelievably massive; but the ultimate return for the client, or impact on its real business objectives, being negligible.

Now let me tell you about the same client, different story, fundamentally different result.

A big impression where it counted

When Microsoft announced it was withdrawing support for its Windows 95 operating system, we went to work again. Our client’s database told us that Win95 was still installed on a hefty percentage of computers and that migrating to Windows XP, which is what Microsoft wanted its customers to do, might not be straightforward since there were a lot of applications deployed in the environment, many of them home-grown, that would function only on a Win95 OS. Again, our client made available a free download that would tell IT managers something about the pervasiveness of Win95 and its dependencies in their environments, the point being that they could then subscribe to the full service that would help them map a migration path to XP.

Well, as Victor Kiam used to say, Microsoft loved the product so much it bought the company! But I’m getting ahead of myself.

Once again, the media coverage of our client’s announcement was truly global. Once again, the demand for its free application was considerable, although less than half what was seen for the P2P app. And once again, very few of the freebies converted to revenue. But one did, and that one was the world’s largest software company, which bought thousands of licenses and gave them away to large Win95 customers specifically so they could use it to map their migration strategy to XP. And, as already mentioned, a year or so later, Microsoft, which previously had been unaware of our client, bought the entire company in a tidy exit for our client’s founders and investors.

Sadly, we lost a client, but we gained a persuasive case study illustrating that outcomes, while a potent indicator of the ROI of a PR program, can be misleading; that only by measuring the impact can the real ROI be authoritatively calculated.

Since not every case produces the kind of clear and dramatic impact discussed here, I’ll come back to this subject in future posts and show many other ways, some quite prosaic but no less legitimate, in which the impact of PR activities can be effectively measured.

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