PR must stop comparing itself to advertising. From old-fashioned printed newspapers to handheld-devices, people are consuming more media than ever before – and trusted, credible, third-party earned media is the most trusted form of advertising. Earned media drives 4 times the brand lift of paid media.
But one of the most contentious things PR ever did was create the term advertising value equivalent or AVE. I’ll go out on a limb here and say when it comes to advertising value, the former doesn’t offer much of the latter. Maybe it did in 1950. But with today’s savvy, socially networked, popup-blocking, ad-skipping consumers, paid advertising continues to lose relevance and effectiveness in driving customer purchase behavior.
A better term to assess the value of qualified earned media mentions is media value. Media value is simply the monetized value you put on that earned media mention.
So just how do we do that? What valuation model do we use?
Most valuation models lean towards a market-setting approach. All things being equal, we make the assumption that supply and demand are at work and media mentions, like houses for example, are being assessed some value based upon their relative worth to someone or something.
First, who finds value in the media?
- Readers find value. Most pay a recurring fee to get access to that media.
- Advertisers find value. They pay the media to reach readers, viewers, listeners, visitors, etc.
- Investors find value. They own shares in the media source.
- Marketers find value. They invest time and resources pursuing a mention in the media.
Second, how does a source (or the market) monetize its audience?
If a source has 100,000 potential readers/listeners of a mention (in an article, broadcast, blog post, tweet, forum post, etc.), then what are those 100,000 readers worth? Is it the amount someone would pay to access those 100,000 readers?
- If those 100,000 readers were all paying some price to access the source, would audience value be the sum total of their subscriptions?
- What if investors valued the source at $250 million? Would the value of those 100,000 readers be some function of $250 million?
- What if those 100,000 readers were actually a window into promoting or selling something else? Would the revenue from selling that “something else” to those 100,000 readers be a reasonable proxy for their value?
The answer is all of the above. Sources monetize themselves any way they can – typically using a combination of all of the above. From our (mediaQuant) perspective, after applying a consistent model to each source based upon how they establish audience value, the rest is pretty simple math to arrive at a CPM (cost per thousand) per source.
Now comes the hard part, determining engagement.
Which of those 100,000 potential readers are exposed and retain that earned media mention? Of those who read it, how did they react to it? And from there, which of those readers maintained any awareness of the mention, let alone adjusted their preferences or behavior because of it?
The classic AVE approach simply multiplies mentions by ad rates and calls it a day (and we wonder why AVEs are held in such contempt).
A more surgical approach is needed.
- How did it qualify as a mention in the first place?
- What was the sentiment around that mention?
- Where did the mention occur within the source?
- How frequently did the mention occur?
- Was the mention in the headline, lead paragraph, above the fold, before the page jump, on the homepage, etc?
- What type of media did the mention occur in? Was it in print, broadcast, online, social, forum, etc? Was it in a national circulation, an international source, a trade versus consumer source, an original versus a republished source?
- Was the reader/viewer already actively engaged in looking for the mention?
mediaQuant’s methodology takes all these factors into account. We do a complete teardown of each mention and then rebuild a corresponding media value based on a series of variables that carefully hone that mention into a something that makes sense — and is NOT a proxy for paid advertising.
While the PR establishment has always rejected AVE as a dirty word, putting a currency on earned media coverage makes complete sense in a market-driven society. A qualified mention of “Emirates Airlines” in a national newspaper has value, in terms of driving awareness, consideration, preference, and purchase/action, just like the Emirates logo on football jerseys has economic value. Advertising does not have a monopoly on putting a dollar figure on putting a brand or an idea in front of consumers for their consideration.
If there’s one thing you take away from this post let it be this. Don’t equate media mentions with advertising. The latter is dying the death of a thousand paper cuts while credible earned media mentions are shaping minds, markets, and consumer behavior. Advertising simply gives you an excuse to get a snack or relieve yourself until the commercial break is over. Do you really want to equate your brand mention with a bathroom break? (Where in fact many people read the NEWS!)