When they hear the term “return on investment”, many people think of it as a simple buzzword from the business industry. However, when companies are thinking about their return on investment, they don’t generally just mean profitability.
The term is used to describe the performance measure used to evaluate the efficiency of a company’s investment. In public relations, it’s not always easy to measure the returns on a company’s investment, especially over a short period of time.
However, over the long term, companies shouldn’t be underestimating the advantages of more exposure and credibility in their industries.
In public relations, return on investment is divided into categories, earned media returns that improve a company’s credibility or reputation, and monetary returns such as sales revenue. The former is used to indirectly contribute to the bottom line of a company, such as increases in sales revenue.
This can be achieved with various strategies, such as through an interview between the business owner and a credible and highly regarded media outlet. The latter type of ROI can simply be generated by an email campaign sent out to leads that can sign up for a sale from a business, in return for getting a free piece of content that’s valuable to them.
These days, there’s a lot of debate over the way that a company should measure its return on PR investments, and very few people can agree on what should be considered a valid metric of PR success.
Metrics such as media mentions or impressions can provide some information on a campaign’s efficiency, but if these measures are not contextualized around a PR campaign with well-defined goals, they’re essentially meaningless.
Some of the metrics that companies can track to measure the return on their PR investments include page impressions, click-through rates, page views, social media shares, likes, and comments.
Companies can also track their average page view duration, bounce rates, and goal conversions.
Companies need to understand the importance of setting measurable goals. This is the only way they can quantify their PR achievements.
However, businesses should still remember some of the metrics that are harder to obtain, such as industry credibility, which is an important signal of the success of a PR campaign.
Companies also need to take into account some of the newer tools and technologies that can help them create more effective PR campaigns. They should consider social media platforms, and understand their role in ROI.
Next, in the more traditional sense, companies also need to put a monetary value on every type of promotional activity they’re doing with the goal of increasing their customer base and exposure.
One of the best ways to measure the success of a company’s PR efforts is by tracking earned media. Earned media is crucial for generating interest in a business, regardless of where consumers might be in the buying journey.
This is because when consumers see the name of a business published frequently in outlets, they are more likely to become familiar with the company, open its website, and start a relationship with it.
They might not convert immediately, but they will be starting their buying journey, which may eventually lead them to convert.
With more than 17 years of PR experience, Matthew leads teams in launching and building high-growth tech companies, disrupting industries, building global brand resonance through thought leadership, C-Suite profiling, and speakers’ programs, as well as crisis communications across a variety of industries.