A seminar on how to demonstrate the value of communications to all aspects of your business

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1. The value of reputation
2. How to measure the value
of communications
3. How to report the value of
communications

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The value of
Reputation

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Three dimensions of reputation
Known
Known for something
Positive/
negative

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Return on Assets:
Positive relationship between
company reputation and return on
assets
Deephouse (2000), Roberts & Dowling (2002)
Profitability:
Good reputation US firms were able
to sustain above industry average
profits over time
Roberts and Dowling (2002)
Stock
market:
Stronger
reputations =
greater stock
price rewards
Pfarrer, Pollock and
Rindova (2010)
Recruitment:
Employers with better reputations attracted more,
better quality applicants
Turban and Cable (2003)
Strategy Execution:
Higher financial reputations meant that companies
could deviate from normal strategic behaviour and
maintain their reputations
Deephouse and Carter (2005)
Academic Research and Evidence

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Research: Major drivers of reputation
Performance
• Financial Performance
• Firm size
• Social (and CSR)
Performance
Status
• Institutional ownership
• Brand
• High status affiliations
Activities
• Frequency of
market actions
• Complexity of
firm’s actions
Culture
• Employee Development
• Organisational culture

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Represents going concern value,
perceived future income and
economic benefits. i.e. reputation
Goodwill: Measured as difference between
market value and tangible assets

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Measuring communications

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Evaluation framework
Audit
Where are we
now?
Setting
objectives
Where do we want
to be
Strategy and
Plan.
How do we get
there?
Ongoing
measurement
Are we getting
there?
Results and
Evaluation
How did we do?

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AVE now discredited
Advertising Value Equivalents (AVE):
Measure the cost of media space, not used to value
public relations
Now discredited
Doesn’t reflect negatives/ neutral
Can be poorly positioned/ presented
Features competitors
Rates used are inflated
Doesn’t measure content value

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The Importance of demonstrating ROI
• Shows demonstrable economic value
• Understood by finance departments
• Critical for justifying communications expenditure (and existence)

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AMEC Barcelona Methodology
Outputs
Business Objectives
Outcomes
• Campaign ROI
• Business KPIs (sales calls
etc.)
• Marketing KPIs (emails
captured etc.)
• Lobbying/ regulatory outcomes
• Press coverage
• Social interactions
• Brand awareness,
consideration, credibility
• Net Promoter Score
• Content distributed (press
releases, articles, social
media)
• Stakeholder engagement
Overall
Evaluation
Key Performance
Indicators
Driver
Social Media analytics
Core audience surveys
Print, broadcast, digital coverage analytics
Internal business Inputs: Sales calls, web
traffic, direct response
Others: Focus groups, Google PageRank
Inputs

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Output
Sources:
• Internal logs
• Stakeholder CRM
• System reports
Conventional Media
•Press releases
•Stakeholder meetings/
contact
•Press articles
•Reactive comments
•Feature contributions
Content
•Articles written
•Blogs written
•White papers created
•Infographics created
•Thought Leadership
Social/ Digital Media
•Tweets
•LinkedIn Updates
•Facebook posts
•Email campaigns
Effectiveness:
• Readability tests
• Pre-testing

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Outcomes – Empirical KPIs
Sources:
• Media: Press monitoring and evaluation
• Content: Google analytics/ CRM (Hubspot) analytics
• Social: social systems or proprietary systems
Conventional Media
•Press influence
•Positioning
•Spokesperson citations
•Coverage sentiment
•Share of voice
•OTS/ Reach
•Key message penetration
•Clean links/ contact
numbers achieved
•Traffic to website
Content
•Engagement rates
•Interactions
•Traffic to website
•Qualitative analysis
Social/ Digital Media
•Page impressions
•Engagement
•∆ in followers
•Emails opened
•Response rate
•Traffic to website

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Outcome: Impact on Target Audiences
Awareness
Favourability
Propensity to Recommend
Key Message Recall
Propensity to Buy
Measure using audience
survey prior to starting,
then every 6/ 12 months
Sample n=>30 (384 for
UK population @95% CI)
Survey intermediary (e.g.
journalist) and final
audiences
Can be survey, interview
or focus group.
Can also measure media
consumption preferences

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Mechanism for measuring performance
Leading indicator of customer engagement
• Promoters score 9-10
• Neutral score 7-8
• Detractors score 0-6
Outcomes: Net Promoter Score (NPS)

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• Direct Sales
• Sales Leads
• Information into CRM
• Regulatory or Political Outcomes
Business Objectives

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Marketing mix v attribution
Marketing Mix
• Top down, aggregated
• Econometrics based
• Calculated over weeks
• No visibility of independent
interactions
• Best for branding
Attribution
• Granular, account specific
• Data scientist based
• Instant
• Shows role of independent
interactions
• Best for measuring customer
journey
v

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How marketing mix measurement works
Ordinary least squares
regression analysis
Can be used to chart
correlation (R2) between PR
activity and sales
Needs large enough sample
sizes (n=>30)
Can run it in excel

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Attribution analysis
Trackable digital/ clean links
Anecdotal
Discount codes
Custom domain names
Form capture (but rotate)

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Human Cost:
• Comms team HR costs (use 2.5x
actual salary)
• Time invested in activities
• Other department input/ sign off
Programme Cost:
• Systems (e.g. distribution,
monitoring)
• Materials (photos, press packs)
• External agency costs
• Licence costs (photos, IP)
Deriving the attributable cost

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Putting it all together
ROI = Attributable Revenue – Attributable Cost
Attributable Cost
Attributable Revenue = Either Marketing Mix estimate or Attribution estimate
• Marketing mix estimated revenue – use statistical analysis
• Attribution estimated revenue = Converted leads from Directly trackable +
Anecdotal + Form capture + Discount code + Domain names [+ (∆
Propensity to Buy x Potential purchasers)]
Attributable Cost = Human Costs + Programme Costs

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• KPIs
• Reports
• Governance
Reporting

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Specific
Measurable
Achievable
Relevant
Time- Bound
Fixing KPIs to measure against

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Outputs
104 press releases to be issued in 2016 (56 local, 48 other)
60 press meetings to be hosted in 2016 (and 12 for CEO)
10 placed articles a month in 2016
A 30% increase in comments issued compared to 2015 (equating to 360 per year)
A 20% increase in Twitter and LinkedIn posts compared to 2015
Outcomes
•A 30% increase in favourable coverage in national, personal finance and trade media
•A 20% increase in share of voice in target media
•A 20% increase in favourable sentiment amongst journalists (NPS measure in annual media audit)
•A 20% increase in favourable sentiment towards company amongst clients (measured in survey annually)
•A 20% increase in favourable sentiment towards company amongst IFAs (measured in survey annually)
•A 20% increase in LinkedIn and Twitter followers (by Dec 2016)
•A 20% increase in Tweet impressions (annually)
•A 1% increase in Tweet engagements
Business Objectives
A 10% increase in net retail sales
A 10% increase in net intermediary sales
Example KPIs (asset manager)

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• Coverage/ results (daily)
• Activity reports (weekly)
• KPI Performance (monthly)
• Strategic reviews (quarterly)
Types of reporting & frequency
+ don’t forget to promote via internal communications…

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Communications Dashboard

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Communications Balanced Scorecard

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Reporting performance to Committees
Statutory
• Board of
Directors
• ExCo • ExCo • ExCo • ExCo
• Board of
Directors
• Board of
Directors
• ExCo
Corporate
Level
• Global
Comms
Committee
• Global
Thought
Leadership
Committee
• Global
Content
Committee
• Global
Comms
Committee
• Global
Content
Committee
• Global
Comms
Committee
• Internal
Comms
Committee
• Global
Comms
Committee
• Global Public
Policy
Committee
• Global
Comms
Committee
• Corporate
Marketing
and Brand
Committee
• Global
Marketing
Sourcing
• Global
Comms
Committee
• Global CSR
committee
• Global
Comms
Committee
• Global IR
Committee
Local
Level
• Local Comms
Committee
• Local Content
Committee
• Local Comms
Committee
• Local Content
Committee
• Local Comms
Committee
• Local Comms
Committee
• Local Comms
Committee
• Local Content
Committee
• Local Mktng
Committee
• Local Comms
Committee
• Local Content
Committee
Corporate
Communication
Media Relations
Internal
Communication
Public Policy
Corporate
Marketing and
Brand
Corporate
Social
Responsibility
Investor
relations

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Line reporting of communications performance
Corporate
Affairs
Corporate
Communication
Crisis/ issues
management
CEO positioning
Thought
Leadership
Media Relations
Social/Digital
Content
Internal
Communication
Employee
Engagement
Change
Management
Conduct
Management
Public Policy
Regulatory
engagement
Corporate
Marketing and
Brand
Social/ Digital
Sponsorship
Events
Corporate
Social
Responsibility
Environment
Community
Suppliers
Investor
relations
Retail
Shareholder
engagement
Institutional
Engagement
Policies &
Global
Control
Board/ExCo
Corporate
Comms
Committee
Local Comms
Committee

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In conclusion
• Communications functions
increasingly have to justify their
existence
• Technology advances enable
greater tracking and
attribution – making it easier to
demonstrate ROI
• Comms professionals now have
many tools and techniques to
demonstrate value of PR
• Strong reporting/ governance
essential to demonstrate value
to decision makers

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Autumn Seminars
0830-1000 hrs breakfast briefings
How to manage your agency 20 Sep 2016