Advertising Value Equivalency (AVE) – The black sheep of the PR industry

As PR practitioners, we have to admit: Measuring PR activities has always been a debatable topic!

Lies in the heart of the heated topic is Advertising Value Equivalency (AVE) is a measurement way too familiar in the PR industry and is often used to evaluate the financial return of media coverage.

However, these days, if you look up the term “AVE in PR” on Google, most search results indicated that the index is either outdated or dead. Why’s that? In this article, we seek an explanation for AVE’s controversial reputation among modern PR practitioners.

A friendly Google search on AVE!

For AVE, its history dated back to the early days of PR. In the past, PR practitioners used rulers to measure the size of a piece of coverage on print media to measure the equivalent advertising value of that space. It operates based on advertising costs. Had the article been an advertisement, how much it would be worth?

AVEs = Σ(size * respective advertising rate)

AVEs are calculated by multiplying the print editorial column length and seconds of broadcast by the respective media advertising rates (Watson, 2013).

However, with online newspapers replacing print media, the above formula is no longer relevant. Hence, these days, PR practitioners have adjusted the formula to the online media advertising pricing. Along with AVE, the modern PR industry has adopted new indices such as impression, reach, engagement, views, etc. to measure online PR activities.

Do you think that solves the problem? Not really!

The formula is not the only argument around AVE. There are debates on the concept and nature of AVE – whether measuring financial returns is meaningful toward measuring the effectiveness of a PR campaign?

This is where you must understand the concept of outputs, outtakes, and outcomes to understand PR measurement.

Outputs are usually the immediate results of a particular PR program or activity. They are the easiest to measure, but these numbers alone don’t give insight into the impact of the campaign. If you look at it this way, an advertising campaign’s reach and engagement are not really different from measuring coverage clipping or AVE.

Then why the society favors advertising over PR? The difference is that advertising yields immediate outcomes. Leads and sales figures are easily measured. But measuring PR outtakes (people’s perception of the brand) or PR outcomes (change in the audience behavior after the PR campaign) is much more expensive and time-consuming. Building a brand reputation takes time. Similar to people, it takes time to build our credibility among colleagues. Reputation and credibility must be tested through time as it does not easily change overnight.

To measure PR outtakes and outcomes, a brand might have to conduct follow-up research and that could add up to the budget. While PR agencies are happy to assist, not every client is ready to accommodate that expense.

Back to the question, is it relevant to evaluate a PR campaign based on financial return? Understanding what you wish for is the key. The first step is to set correct expectations on the objectives. Ask yourself: what do you want to know?

AVE and coverage clipping are outputs of a PR campaign. As output metrics, AVE and coverage clipping still work to evaluate a PR campaign. It gives a brand an idea of the article’s spreadability and financial returns. However, while AVE and the number of coverage are output metrics, PR practitioners look at it expecting to learn about PR outtakes and outcomes. When reality and expectation mismatch, of course, we will be unhappy with the metric itself. In addition to AVE, brands can adopt social listening and follow-up researches to measure outtakes and outcomes to correctly investigate the ROI of the brand’s PR activities.

To sum up,

  • Modern PR practitioners expect to measure more insightful outcomes, making AVE seems obsolete.
  • Every PR campaign’s true intention: outtakes and outcomes – take time to generate, and budget-consuming to measure. The nature of AVE is an immediate output metric that could provide insights on the campaign spreadability and financial returns. Therefore, many agencies and clients still choose to use AVE as a short-term measurement.
  • Brands should not rely on only AVE, but they should adopt other research and tools to measure PR campaign impact in the long run.

Despite being called obsolete, AVE sees very few alternatives. In the future, can we expect to discover more cost-effective and meaningful PR output measurements with the help of new technology?

Hanh Le, Assistant to Managing Director at EloQ Communications, a leading PR and marketing agency in  Vietnam. Hanh is supporting EloQ in connecting and maintaining relationships with partner agencies in Asia and other global PR networks to execute global projects, as well as to leverage service quality in the communications industry.

 

References:

Watson, T. (2013). Advertising value equivalence—PR’s orphan metric. Public Relations Review39(2), 139-146.

Anderson, F. W., Hadley, L., Rockland, D., & Weiner, M. (2009). Guidelines for setting measurable public relations objectives: An update. Institute for Public Relations

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