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The genesis of ROI of PR measurement
An issue which the public relations industry has faced for long is how to show the impact of PR outreach, or in other words, how to measure the ROI of PR. Over time various methods have been used, with the AVE (advertising value equivalent) being the standard for quantitative measurement for literally decades, until the industry decided that it needs to be dropped as it really does not do justice to the impact which PR makes for creating and establishing a positive perception, managing reputation, managing issues or crisis, or generating the several other benefits which result from a PR outreach.
This article looks at how it all started. In a follow up article to come later, we shall look at what are the current practices for measuring the ROI of PR
It was after George Washington became the first president of the United States of America in 1789 that US presidents began tracking newspapers to gather intelligence on what was being said about them on a public level. The 19th century then saw the emergence of industries such as railroads, and of evangelist societies, being tracked to evaluate public opinion and media coverage, while news cutting agencies also emerged.
The 20th century saw the first publicity agency in the US, the Publicity Bureaucracy, being founded in Boston. The American Telephone and Telegraph Company, being one of their biggest clients, saw a 60% reduction in negative media coverage after signing up for their publicity services. Publicity Bureau was pioneered the creation of a system, The Barometer, to track and influence press coverage of the railway industry. Consisting of a card index of the attitudes of editors, gathered from visits, and media usage of publicity material, it enabled the company to gauge whether a paper was ‘good’ or ‘bad’.
Contemporaries Ivy L. Lee and Edward L. Bernays, amongst the earliest founders and pioneers of PR advisory firms, had different views about PR. Lee’s view was that PR is an art, and his work was ‘indefinable’ and ‘non-measurable’, and what he was doing would die with him. Bernays, on the other hand, held that PR was an applied social science that required ‘opinion research’ and evaluation. Both published books on PR which worked to create a greater awareness of PR, and encouraged academics to join the field as well.
The 1930s witnessed the advent of various measurement and evaluation methods within the US, particularly at a government level. The Roosevelt Administration of 1938 practiced different techniques of publicity dissemination, and also analysed the ways in which the public perceived it, the aim being to record changes in attitudes of communities towards the government’s political moves. As a result of these efforts, a barometer was compiled, holding great analytical and political significance.
In the late 1940s, communication and publicity were not seen as public relations itself, but rather as sub-sections of PR in the shape of dialogue and delivery procedures. However, by the 1960s, this perception vastly changed to acknowledging publicity practices as equating to public relations. This transition in ideologies occurred due to business practitioners viewing PR as a less costly way of getting media coverage as opposed to advertising. The resulting impact on public relations measurement and evaluation was a move away from the social science-led emphasis on public opinion research, to a more pragmatic analysis of media coverage, which went on to dominate the second half of the 20th century.
The Institute of Public Relations (IPR) established in 1948 aimed to promote the use of research and examination-based knowledge in the practice of public relations and corporate communication. A year earlier, Advertising Value Equivalency (AVE), a PR measurement technique, was introduced to calculate the dollar value of media coverage of a PR campaign, via measuring the size of the media coverage obtained in column-centimetres, and estimating the cost based on the advertising rate of the same space if bought to place an advertisement. However just a year later, in 1949 the IPR issued its first warning against AVEs, on grounds of it not being a holistic measure of studying PR as it does not take into account qualitative factors. This warning by the IPR also marked that AVE had become a common practice in the second half of the century, which is why it needed to be warned against. However, further intellectual discourse pertaining to it did not develop until later in the 1960s.
Across the Atlantic, PR as a practice in the UK was a post-World War 2 development, although the first PR agency was established in London in 1924. But it was the Second World War which spawned a great publicity outreach effort by propaganda experts and journalists working for the government and the army, and this then translated into a growth seen in the field of PR. By 1964 academics from Germany also joined the discourse relating to PR research, with leading topics of interest being analysing the masses use of media, content research, and studying the effect of media.
In the 1970s and 1980s there was growing academic contribution, with a call for PR measurement and evaluation to shift towards a social science based approach involving surveying, planning, and inquiry-based techniques. With the 1990s came the recognition of evaluation being a major professional and practice problem. In response to this, several countries began taking initiative to counteract these issues. Quality Assurance (QA) approaches to production and the BS5750 or ISO9000 process standards became part and parcel of management language. Organizations with QA certification often required their public relations advisers to also have the same standards of operation. In the late 1990s extensive national campaigns to promote best practice in measurement and evaluation were launched, with terminology of three stages of evaluation of ‘output, out-take and outcome’ – becoming globally popular.
A UK trade body known as Association of Media Evaluation Companies (AMEC) was also launched in 1996. Currently known as the International Association for Measurement and Evaluation of Communications, it has members in 38 countries, which is indicative of the expansion of the measurement and media analysis service industry. In the US, the Commission on Public Relations Measurement and Evaluation was established in 1999, taking on a substantive role in undertaking practice based research and circulating it.
Mid-1990s onwards, the Internet and then the social media evoked the interest of PR practitioners and evaluators. Computerized content analyses based on keywords became increasingly popular as a media analysis methodology, with the advancement of search engines like Google. This method allowed for larger volumes of media coverage to be tracked, allowing for a more efficient method of information tracking evolving.
Then in the 21st century came ‘The Balanced Scorecard’, a book highlighting better integration between organizational functions and sharing KPIs for the benefit of corporate communications, so that they can pay greater attention to communication strategies rather than the evaluation of corporate communication. As a result, the incoming years saw an increase in growth of the service business of media measurement and PR effectiveness, especially amongst corporate clients. By 2010 the Barcelona Principles were released in order to further tailor and improve practices within the field of public relations.
What then came next and where we are today on measuring the ROI of PR will be the subject of another article to be published in this space!
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