Is AVE (Advertising Value Equivalent) the right way to measure PR?
Some players in the PR industry have long used AVE as a way to justify the cost of PR. They say that if an ad costs "x" per column inch then editorial coverage of, say, four-column inches, must have an equivalent value of four times "x".
Some go even further and claim that as editorial is trusted three-times (where did that figure come from?) more than advertising; then the brand value is actually 12-times "x".
AVE is a comfortable statistic. Its logical. Marketing managers can see that a PR spend of, for example, £3k that generate an AVE of £30k delivers a 10-times ROI. They can see that they have spent less or more on PR than the equivalent amount of advertising would cost. It creates lots of stats for the monthly reports.
The problem is that it is flawed. It presents PR as an alternative to advertising. It is not. PR brings value that advertising cannot – just as advertising brings value that PR cannot.
It also allows PR agencies to claim a benefit to the client without showing what that benefit is. Your ads have to show a return which you measure via tracking. But your AVE PR is not subject to the same measurement.
In other words, you know if your ad in the Sunday Times Magazine classifieds has paid for itself, because you can measure the responses, leads and sales. But you can’t say the same for the four column inches you may have received in the Style supplement.
So, how do you measure the value of PR? By having clear, measurable objectives for the type of communications you want, where you want it to happen and how often it is to happen.
Ivor Morgan's Blog 