In response to this age-old post, which briefly described the process that P&G used to determine PR's true bottom-line value (hallelujah!), this week I received a note from Mark Weiner, who heads up Delahaye, the measurement firm that aided the consumer giant:The method that P&G used is called "marketing mix modeling" which ties multiple streams of marketing data -- including PR, advertising, price promotions, direct marketing, the Internet, sales in terms of dollars and units, and more -- through a multiple regression anaysis by date, market and campaign. By looking at sales results over time and from market to market along with the marketing activities present at that time, the statistical model identifies the extent to which each marketing agent contributes to sales.As long-time readers know, the subject of PR Measurement fascinates me. In fact our agency developed its own methodology - after a 2-year research effort - to help clients measure PR's impact on Sales. (Our approach is complementary to Delahaye's marketing mix modeling.)
Delahaye, the research-based consulting firm I lead, has worked on dozens of similar analyses for a variety of companies. In each case, in categories as diverse as automobiles, telecom, entertainment, consumer package goods, financial services companies and more, we find the same result over and over again: PR works, delivering an ROI that is the best among all marketing agents. Whereas mass-market TV advertising delivers a return of roughly $1.25 for every dollar spent; and whereas price promotions lose a quarter for every dollar spent; PR delivers from $3.00 to $8.00. At the same time, PR in the form of marketing media relations lifts all boats: in a positive PR environment, the advertising is more effective, the telemarketing more efficient and so on.
Typical PR data won't work: simple tabulations of clips, ad value or impressions repeatedly fail. What's required is PR data which are both a) consistent and integratable with GRPs from the marketing world, and, b) representative of PR's unique role within the marketing mix (only semi-controllable at best).
The question is whether the PR profession is prepared to take advantage of the opportunity. As you rightly point out, the advertising trades have broken this story rather than the PR media. The Ad Age story ran months ago and it is only in this week's issue of PR Week that the P&G/Delahaye story appears. The Council of PR Firms published a booklet on the subject but the PRSA, IABC and other leading professional bodies haven't been touting this extraordinarily important development.
But honestly, as challenging as it was to develop our approach, the HARDER part has been convincing fellow PR pros and even CLIENTS that tying PR to Sales results is not only achievable, but also worth the additional time/cost/effort.
So I am not surprised that Delahaye has experienced frustrating amounts of hesitation on the part of the PR industry. I am saddened, but not surprised.
PR pundits (myself included) spend so much time, lately, debating the finer points of new trends in media consumption, and that's important & laudable... But, I will continue to insist that our cleverness in communications will never gain PR a seat at the Boardroom table if we don't also wise up to the "Measurement Mandate."