Why PR still struggles with ROI

*Originally published in Marketing Magazine

Close to 20 years ago at a Spring Conference of Counsellors Academy (Public Relations Society of America), I heard a startling presentation from the then chairman of one of the big five American accounting firms. For PR to be successful, to be allocated sufficient budgets and earn corporate trust, “buy in” must come from the top.

In the same breath he warned that management consultants may represent our industry’s greatest threat. What did he mean by this? Simply stated, short of being proficient at doing media relations or event planning, management consultants bring the kind of talent that resonates with the C-suite. They are analytical, strategic, have great written and verbal communications skills, understand business dynamics and market forces, are highly productive and organized AND they know and can explain numbers. What’s more, they are comfortable responding to tough questions about profitability and can do so with really nice charts.

Were we all now going to hire MBAs? At the time that thought was quite appealing and the buzz among my PR agency colleagues was that if we didn’t get the ROI thing down pat, we’d soon end up pitching against consulting firms Mercer and McKinsey.

The industry hasn’t seen this prediction come to pass. It may be because we don’t offer the salaries commanded by management consultants or because promotion and publicity are still a big part of what agencies do. While Canada’s PR industry can be held up as a model for its Media Rating Points system, I’d say that we haven’t made nearly enough progress in quantifying ROI.

Why is measuring ROI for public relations such a challenge? To begin with, I believe that PR is so diverse in what it comprises that a campaign or strategy would have to be fractured into all of its parts if only to begin to probe each element, let alone dissect them into something that could be evaluated. PR initiatives are also not generally undertaken in a vacuum, so how do we carve out the impact of the PR and attach a number to it? Another obstacle I’ve experienced is the difficulty in getting sales data from clients as well as details on other marketing programs that may be running concurrently. Company structure may be another impediment when the sales and marketing departments are separate.

I agree with Ford Kanzler, principal of Marketing/PR Savvy in Redwood, California whose approach to the ROI question with prospects is to point out successful brands and the correlation to PR. Al and Laura Ries did a good job of this in their book The Fall of Advertising and the Rise of PR. The problem, though, is that public relations has not become any easier to understand, explain or sell, therefore it has not become easier to measure its value. Or maybe we should reverse that statement.

The greatest challenge will be to convince those who question public relations in the first place. I am not sure that we can or whether we would even want to try and convince these folks. I maintain that unlike other forms of marketing that can be seen, touched and better controlled, for some, public relations is difficult to digest conceptually.

Businesses that have experienced the outcome of a well structured and executed executive reputation or crisis communications plan, whose brands have become household names after a clever social media campaign, those that have harnessed patient and physician support for an advocacy program or driven patients to an information website, recognize the value of their investment. This is where the opportunity lies.

Having a successful ROI discussion with clients and prospects lies in the hands of the PR industry and we should employ the same rigorous processes to get to a meaningful answer. We know what clients want; we need to find a way to give it to them. If we’re not sure – then let’s find out how best to do so. As the excellent storytellers we are, we need to author the story that speaks to outcomes in a way that our readers can learn. But we may need to illustrate our story with some colourful charts.

This column is the first in a two-part series. Up next: What’s out there, what to measure and how.