Gini Dietrich

How Do I Determine the ROI of PR?

By: Gini Dietrich | October 16, 2014 | 
49

ROI of PRBy Gini Dietrich

A couple of years ago, I received a new business phone call two weeks before Christmas.

The prospect was a very frazzled, very stressed business owner who achieved his dream and got his product in some of the big box retailers, including Target and Walmart.

A dream come true, right?

The problem was he needed to sell out of the product in those stores by Christmas or they wouldn’t be restocking him.

A very real, and very stressful, situation.

But it was two weeks before Christmas and he thought media relations would be his magic bullet.

In his mind, he could hire us, we could call our friends at the major publications, and voila! He would sell out by Christmas.

Of course, he didn’t have anything newsworthy and his product was fun, but a “me too” gift. His competitors were outspending him and were much more creative. Things we could have worked with, given six months or a year.

But two weeks?

I was kind of a smart butt and told him the only way he’d get in the New York Times before Christmas was if he shot someone…and preferably someone in the White House.

Let’s just say he said some unkind things and hung up on me. I also could have been a little more sympathetic.

Time-Specific ROI Estimates

I was reminded of this story when I read, “More Clients Asking for Time-Specific ROI Estimates” on PRNewser.

Apparently they belong to a PR/marketing group on Facebook and saw an update written by a prospective client who is looking for help in justifying the cost of hiring a PR firm.

They said:

We would like to add some goals and targets against which we can measure. These could be number of placements, traffic from placements, tweets and retweets, etc. Could you outline some reasonable metrics for a 3-month engagement?

Allow me to dissect this question.

  • Goals and targets to measure against is a perfectly reasonable request, but what is it you’re trying to achieve? The answer should be increased brand awareness, increased interest, and increased sales (or higher margins or a shortened sales cycle).
  • Number of placements, traffic from placements, tweets and retweets are the wrong metrics. These are vanity metrics. Yes, you should have traffic from your media relations efforts, but traffic alone does not a happy client make.
  • Three months?! That’s barely enough time to get going. Every, single publication, blog, and media outlet in the world has lead times. Even this little blog has a good month…and that’s for the information and companies we’ve already vetted. If you’re new to us, it could be two months or longer. Now multiply that for larger organizations. Trade publications typically have three to six month lead times. Consumer publications have six month lead times. Three months is not long enough to accomplish anything.

Rather, this is what you should consider for the ROI of PR: Months one through six are all about building awareness. Months seven through 12 are to drive interest. After the first year, if everything goes according to plan and there aren’t any surprises, you can start driving revenue from a PESO communications model.

Then you can build your goals and targets against which you can measure.

How to Figure the ROI of PR

It’s unfortunate that this is not a unique request. It actually is a very common perception about the PR industry: You get me lots of stories and my phone will ring off the hook.

That’s just not the case…and we’re terrible about setting expectations (as an industry).

As it turns out, LalaboyPR, an agency run by sisters out of Puerto Rico and New York City, was anonymously referenced in the PRNewser piece and they tweeted me.

Conversation with LalaboyPR

When you are a prospect looking to hire a PR firm (or a PR firm working with a prospect), really think about what it is you want to achieve before you figure out what the ROI of PR is.

Media impressions and number of placements and Facebook likes and YouTube views and newsletter subscribers and website visitors are not the correct metrics.

If you do not have a system in place to track what happens when you increase all of those numbers, and whether the efforts that result in those things are driving qualified leads and new customers, you aren’t ready for primetime.

The way to handle the new business process is, instead, to ask for case studies and references for like businesses where the PR firm has done what you need them to do, in terms of business goals.

  • Ask what their average ROI of PR was for the past 12 months with current clients.
  • Ask how they integrate all four media types.
  • Ask which clients—current and past—you can talk to where the results have been similar.

Then let them do their thing.

  • They’ll have to dig into your analytics.
  • They’ll need to see a business plan.
  • They’ll have to fully understand the sales process.
  • They’ll need to know what’s coming and where your organization with be in a year, three years, and 10 years.
  • They’ll need to see what’s working and what’s not working.
  • They’ll need to figure out where your internal team is weak.

Then, and only then, can they develop a strategy and give you the goals and targets against which you can measure.

I’m really jealous of the super talented people at Ink Factory so I thought I’d try my hand at drawing my own image for this. What do you think? I probably shouldn’t quit my day job.

About Gini Dietrich


Gini Dietrich is the founder and CEO of Arment Dietrich, an integrated marketing communications firm. She is the author of Spin Sucks, co-author of Marketing in the Round, and co-host of Inside PR. She also is the lead blogger at Spin Sucks and is the founder of Spin Sucks Pro. Join the Spin Sucks   community!

  • @ginidietrich  – Such a great commentary on the age-old question – What’s the ROI of [insert anything here!]? Without goals or a plan, there’s no long-term return.  I wonder if that frazzled business owner ever figured out how truthful you were being with him.

    PS – Why does your light bulb look like a mushroom?

  • HAHAHA! I love the image!! And, as always, excellent advice!

  • lizreusswig Look, I’m not an artist. There is no reason to make fun of my light bulb! Did you know it’s a light bulb? I rest my case.

  • belllindsay This is what Gini does at 9:30 at night.

  • ginidietrich Not making fun…just thought there might be some “creative” reason! And your stick people are WAAAYYY better than mine would be! 😉

  • lizreusswig LOL!! I don’t think I’ll quit my day job.

  • ginidietrich belllindsay I am sure they take spending some time with to be what you want them to be, but I think the Ink Factory images are pretty cool! Glad you tried your hand at it! (I mean, some *GREEN* ink may have made it pop a bit more but …..) (and another post from which there are a lot of great takeaways btw).

  • biggreenpen Green next time!

  • ginidietrich biggreenpen ha ha deal!

  • “Can you get me on the New York Times?” is the PR equivalent of going to a trainer two weeks before your wedding and telling her you want Jennifer Anniston’s body.

  • Eleanor Pierce Love the analogy.  I’m stealing that! the next time I talk about media relations. 🙂

  • Pingback: The Ticker: Pitching Bloggers; “Sorry Not Sorry”; ROI Update; And More - PRNewser()

  • It’s all about the PESO, baby.

  • There are two issues.

    1. We are driven by vanity. A big piece in the NYT feels good, even though you might reach more of your audience in some local weekly newspaper.  Have 10,000 twitter followers feels better than 750, even if those 750 are likely customers and the 10,000 aren’t.

    2. I also think too many people working in various marketing disciplines (and frankly other disciplines that serve in the B2B environment), don’t understand how what they do impacts the business goals of a client or customer. So they can’t explain it. So they make promises they can’t keep and develop plans that don’t align with business goals. 

    Both just make us who try look bad.

  • DaveMinella

    ClayMorgan Clay, your comments are so true, especially #1. “I want to be on/in [insert huge media outlet here].” When asked why, many clients can’t answer. It looks good to the CEO, so the brand manager looks good. Much of that is our own fault because we fail to fully explain our capabilities and our own ROI, and we’re often afraid to tell our clients “no.”

  • Eleanor Pierce Wait. What? That doesn’t work?

  • RobBiesenbach I’m not sure how I feel about this photo.

  • DaveMinella I recently had a new business meeting where I determined the prospect wasn’t the right fit for us. The strangest thing happened. They said, “OK! OK! We’ll do things your way. We just want to work with you!” It’s like high school all over again!

  • ClayMorgan It sure does feel good to have your peers say, “I saw you in the NY Times!” Which equates to, “Boy, you must be really successful now!”

  • ginidietrich Well. You’d certainly come closer than I would! #PeteTheTapeworm

  • ginidietrich Why would you not feel good about this photo? It’s a great photo! Okay, maybe not technically. Or is it because you have words on your face?

  • sherrilynne

    ginidietrich same as it ever was.

  • RobBiesenbach I have words on my face!

  • ginidietrich Well, they’re not bad words. But it just occurred to me that maybe it’s not right to post pictures of people on their blog, so I will take it down if you want!

  • bobledrew

    Your story about the frazzled retailer and the PR Newser point out a big failing point. Not of PR / social media folks. But of businesses. 

    Far too often, businesses don’t put in the time to think and act strategically, to look ahead. Too much puttin’ out fires, too little thinking ahead, too much last-minute asking for things that are likely impossible and almost certainly ineffective. 

    Canadian humorist Stephen Leacock once described a character who “flung himself from the room, flung himself upon his horse and rode madly off in all directions.” Businesses shouldn’t fall into that trap, and we shouldn’t aid and abet them. 

    So here’s my question, Ms. Dietrich and the usual gang of Spinsuckers: 

    If we get these calls or emails from potential clients, do we: 

    A) laugh at them
    B) try to achieve their goals because we need the bidness 
    C) do SOMETHING to try and land them as a client without buying into their craycray
    D) something else 

    ?

  • RobBiesenbach LOL! No, you don’t need to do that! I was just giving you a hard time.

  • bobledrew I think the answer to your question depends on who the prospect is. If someone wants us to work magic with only two weeks, we’re going to turn them away. If they are a perfect fit for us and are super qualified in most every area, we’re going to talk to them about our process, how it works, and the kinds of results we get. Most often, though, the answer is D because we don’t like to work with organizations that have unrealistic expectations and we know it’s highly unlikely we won’t win. We like to win.

  • BillSmith3

    bobledrew Unfortunately a lot of companies fall into this category. I would pick D as well.

  • ginidietrich

    sherrilynne I need a reason to come see you guys. I miss you!

  • Been a day late this week on everything! Sorry!

    I know I am not the genesis for your posts but I do like when I see a post that is related to things we discuss, in this case the direct sales vs content because many of your things here is what I meant in terms of arming a direct sales force with.

    I wrote a 3 part post over time on Shonali’s blog when I was helping ChunknChip find PR help and I experienced so much of this because the Owner contracted for 3 months then saw no results would call me and say ‘Let’s get a new PR person!’ And since I don’t come from PR (though now I am an expert thanks to Shonali and yourself) I saw the disconnect between the pitch and the expectations.This has all three posts if any SS readers are curious.

    http://shonaliburke.com/2011/10/24/working-with-a-pr-pro-third-times-a-charm/
    The problem with the vanity metrics is they are like Nielsen ratings. You have no proof anyone saw an article or a tweet or a facebook post. So while I can claim ‘Hey got you in the NY Times here is the proof’ what if it is buried in a section or place no one reads. The NY Times surely is not going to give me page view numbers just so I can prove how many readers read it online after they just gave my client free exposure. 

    Some of this stuff as discussed here on this blog a gazillion times is much of the awareness effort is tactics vs strategy. It should be combined with other channels and not expected to stand alone. If the end goal is increased sales using a tactic as a strategy and not employing the other tactics available is like running the Belmont Stakes with a horse missing 1 leg and 2 of the other 3 tied together.

    Problem is aside from ginidietrich who really is going to turn away business knowing this?

  • sherrilynne

    ginidietrich 🙂

  • RobBiesenbach Funny  that slide  showed up during our   Digital Strategy & Communications Management course slide deck with @martinwaxman . Sans the “Gini Tips” and @ginidietrich  with the  facial tattoo text.

  • LalaboyPR

    ginidietrich Humbled that our interaction produced this incredible insight! This post will now be called–Letter to all our future clients.

  • ginidietrich

    LalaboyPR You know, that’s a really good idea. I think I shall do the same!

  • LalaboyPR

    ginidietrich It’s such a common question. And if we had a nickel for anytime a client requested results that would take 6-12 months in 1…

  • Such a valuable post, ginidietrich. Like you say, it’s a marathon not a sprint. More and more, it’s about the strategy not just the tactics.
    There’s been a lot of backlash in our industry lately about using the term ROI for communications efforts that don’t directly change financial information (http://www.socialmediaexplorer.com/social-media-measurement/measuring-roi-means-money/). I would love to hear your stake in this debate.
    I think for communications professionals to serve the organization’s goals, we need to better understand the business language being used by executives. Part of getting that seat at the table.

  • DorothyCrenshaw

    Thanks for this. There is so much to unpack here, not the least of which is a
    reasonable method for setting communications metrics that are tied to
    biz goals. But I’d be happy if, as an industry, we could agree that no
    one should promise earned media results before three or four months’
    time. That’s the tail of the dog, but it would eliminate the guys who
    somehow think you can accomplish something significant in a four-month
    project.

    • Totally, totally agree! BTW, I’m a big fan of yours! I love seeing you here.

  • MonicaMillerRodgers Oh dear. That’s going to make me angry, isn’t it? I’ll go read it.

  • MonicaMillerRodgers OK. I read this (and wrote a blog post about it this morning). I agree with Jason…and disagree with the author of the original article.

  • Pingback: PR ROI Means You Have to Do Real Math Spin Sucks()

  • ginidietrich Not that I was aiming to get you riled up, but I’m glad I made you mad in a good way. Love this one and your new post (pretty much anything you write).
    I’ve been struggling with this debate for awhile, but I find myself closer and closer in the “Use ROI in the Right Way” camp. I think it’s best if we use that term when we’re actually doing the math formula, not just when we’re “gut-feeling” it. I do believe there are activities in communications you can’t put numbers to, and we shouldn’t be talking about the ROI of it though it does have value. We’ve advanced so much, too, that there is now so many metrics, and ones that actually mean something, we can use and correctly talk about the ROI of communications.

  • Pingback: Media Bullseye Roundtable 2014.18 with Guest Co-Host Mark Story - CustomScoop's Media Bullseye()

  • Pingback: Media Bullseye Roundtable 2014.18 with Visitor Co-Host Mark Story | Posts()

  • Pingback: Media Bullseye Roundtable 2014.18 with Visitor Co-Host Mark Story | Posts()

  • bpswalenz

    petergranat congrats on the Gorkana deal.

  • sveback

    PublicityGuru Very interesting – I’ve done all my own PR (I’m poor) and agree that people don’t get it takes good, old-fashioned time!

  • Pingback: PR ROI « MensajeClavePR()

  • Pingback: Three Tools to Show PR Value by @aly_saxe Spin Sucks()

349 Shares
Buffer27
Tweet177
Share57
Share65
+123