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Advertising Value Equivalency (AVE): What PR Practitioners Need to Know

“This Advertising Value Equivalency (AVE) thing won’t go away,” she replied. “A client is insisting we use them and multiply the results by 2.5, which she says is the ‘standard’ industry multiplier. I explained that AVEs are not the value of public relations. But the client doesn’t want to change what they’ve been doing for a long time.”

Join David Rockland for his online training session, “Demonstrating the Value of the Work You Do — Part 3,” on March 20, 2012 3–4 p.m. EST.  This public relations measurement training sesssion is free to PRSA members.  Register Now

Jessica was back with a big smile on her face. “Last month,  I almost got fired for a media analysis of the Bon Jovi party for the ‘Loved Ones Alarm Clock,’ showing a ‘return’ of $20 million in Advertising  Value Equivalents (AVEs).

“After we talked, I measured the quality of the clips and message delivery to the target audience: people who sleep alone.  And, we added questions to the client’s tracking survey to figure out increases in awareness and actual purchase. The client was so happy,  I got promoted to account executive!”

“Congratulations,” I told her.  “What’s up now?”

“This AVE thing won’t go away,” she replied.  “A different client is insisting we use them and multiply the results by 2.5, which she says is the ‘standard’ industry multiplier. I explained that AVEs are not the value of public relations. But the client doesn’t want to change what they’ve been doing for a long time.”

This has been a common conundrum following the PR community’s adoption of the Barcelona Principles in 2010 that called for an end to using AVEs. Here’s what clients and PR practitioners need to know:

  • AVEs are based on the cost of advertising.  The value of advertising is not equal to its cost; so why would the cost of advertising be equal to the value of public relations?
  • Standard multipliers showing that earned media is more valuable than paid media don’t exist. Sometimes earned media is more effective, and sometimes it is less effective.  There are techniques to figure out the relative value.
  • Quality has to come into the picture when evaluating earned media. Did you say the right things to the right people in the right place at the right time? Blanket use of AVEs assumes answers to all these questions are, “yes,” which they rarely are.
  • The value of public relations comes most often from effects on awareness, understanding, perception, behavior and advocacy — none of which are the cost of advertising. Measuring the message delivery to the target audience through media analysis is a helpful proxy for PR value.

Meaningful metrics

However, sometimes a client won’t back off — and after all, those with the gold make the rules. Here are a few ideas to dissuade clients from using AVEs:

  • Show them the numerous articles about the PR profession’s rejection of this measure.
  • Remind them that many PR awards programs are now discounting or rejecting entries that use AVEs.
  • Bring some measure of quality into any measurement of media results; impressions and hits alone are meaningless.
  • Ask if they have an existing brand or reputation tracking survey. If so, then you can often add a couple of questions to determine PR’s impact on audience changes and even business results. Move the conversation to these kinds of metrics and away from AVEs. If the client doesn’t have a survey like this, then remind them that they can conduct surveys inexpensively.
  • Compare the qualified impressions from earned media to the cost of buying the same number of views as advertising. But the term “qualified” is critical — you have to adjust for the amount of your target audience that you actually reached, and what portion of your message actually appeared in the media.  And, if you decide to go this route, then it must be abundantly clear to the client that you are looking at the efficiency of  budget spent, not value created by public relations.

Meanwhile, we want to hear from you.  Write to AskDocRock@prsa.org.

This article originally appeared in the February 2012 issue of Public Relations Tactics.

David B. Rockland, Ph.D. is partner/CEO and managing director for the research and change communications businesses at Ketchum. He has held leadership positions in corporate communications and research throughout his career, with extensive global experience in both fields.

1 Comment

  • It seems that AVEs are a lot more trouble than they are worth. But a lot of organizations still want us, as PR professionals, to use them. It is also a way to put our successes in business terms. As the profession is fighting to earn “a seat at the executive table” we need to be able to speak the language. Some of the other techniques seem a bit “wishy washy” with regards to business language and techniques. What would be better ways to evaluate that are still founded in that business executives can understand and relate to?

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