If you’re in the PR industry, you definitely know what AVE is. AVE, or Advertising Value Equivalency, is a metric that is often used as the basis of PR value. Put simply, AVE determines the value of earned media placement by comparing the cost of buying the space used for it with the cost of an advertisement of a similar size or placement.
As the assumption is that an editorial piece will draw more readership than an ad of the same size and is therefore more valuable, PR value is obtained by multiplying AVE with a representation of this perceived value, usually 3. This method of calculating PR value helps PR professionals justify their work to management — with a dollar value attached.
However, equating AVE with PR value is problematic. Quantifying the impact of PR efforts through its supposed financial value simply doesn’t justify the increasing strategic weight that PR is gaining in the boardroom. In an increasingly digital-first media landscape, PR professionals are also in need of metrics that can help them to aggregate online content.
First of all, AVE is relatively easy to calculate. As long as you know the number of articles published, the size of the articles, and which publication they appear in, you’re pretty much good to go.
Second of all, AVE helps PR professionals explain PR value to management. Not only can you assign an overall AVE to your earned media within a stipulated time frame, this figure also oftentimes looks great. In more traditional management circles, AVE is still regarded as an easy and straightforward means of linking PR efforts to Return-on-Investment (ROI).
As great as PR value derived from AVE sounds from a management perspective, C-Suite executives are becoming increasingly aware that the PR landscape consists of much more than just editorial content.
The traditional PESO model, which merges paid, earned, shared, and owned media, has become increasingly complicated. Drawing eyeballs through quality content and link building has become more and more difficult, and positive content centred around your brand is more likely to be the result of an advertorial, influencer partnership or sponsored post. In addition, the now widespread usage of social media means that organic content creation often comes hand in hand with boosted posts and ads.
As such, C-Suite executives are now more conscious of the differences between their paid, earned, shared, and owned media channels. This means that they are also more conscious of how PR value is being calculated and are aware of the need for PR value to reflect these different assets.
AVE has long been condemned for its weaknesses. In calculating AVE, PR professionals ignore the placement of the article, the key messages addressed in the article, as well as the tone of coverage. These three factors make a huge impact on the value of earned media.
For one, whether your article is front-page news or simply a filler makes a huge difference to your audience. Furthermore, even front-page articles may differ in significance depending on whether the article is above the fold or not.
Second of all, front-page news isn’t always good news. Equating a full-page spread lambasting your brand with an advertisement of the same size — which can never provide negative coverage — isn’t an accurate judgement of how valuable the article is to your brand.
As such, while AVE can be useful when calculating a single or very specific set of articles, it simply isn’t a fair metric when assessing a brand’s coverage in a holistic manner.
Consider this — Meltwater works with a global hospitality company who cares a lot about how their investors perceive them. As they operate out of the United States, these investors obtain their coverage from tier-one publications there. The United States is a mature market that supports a diverse and largely digital media landscape. As a result, PR organisations in the U.S. have since shifted their gaze away from AVE as the main proxy for PR ROI. These investors thus expect to benchmark PR performance on alternative metrics that provide a more well-rounded understanding of PR value. Our client therefore needed a means to move towards measurements that match those used in these markets.
The need to find better metrics has proven to be an industry-wide concern. As early as 2010, the International Association for Measurement and Evaluation of Communication (AMEC) has been advocating for a shift away from AVE towards more meaningful evaluative metrics. In 2015, these principles were updated to place greater emphasis on social media coverage, KPI-based indices and sentiment analysis.
A combination of these alternative metrics allow PR professionals to tailor PR value to their brand based on how significant each metric is in relation to their goals. However, this in itself is difficult to calculate.
Currently, various alternative frameworks exist to help PR professionals with measurement and evaluation alongside the plethora of individual metrics that may be used to measure PR ROI:
Lewis’ Awareness Measurement
AMEC’s Valid Metrics Framework
Meltwater has been working with PR organisations over the years to combat the weaknesses of AVE and formulate a more robust means of calculating earned media value. Meltwater’s Custom Scoring tool takes weighted indices and automates them for ease of use.
Custom Scoring allows you to provide a score for each piece of editorial content. These scores are associated with six key metrics, namely the publication source, article prominence, article sentiment, article reach, tags, and virality or social echo. These metrics can be toggled on or off based on the needs of each brand.
Source, sentiment, prominence and reach are indicators of an article’s tone, trustworthiness, and readership base, which can give you an idea of how targeted the article is to your audience and how valuable the article is to your brand. Tags allow users to assign particular attributes to their articles in order to observe trends in their earned media coverage.
Social echo, on the other hand, is an extremely important aggregator of the value of social posts, where shareability plays a huge role in determining where and when your post appears. An Instagram post that has been liked, commented on, and reshared multiple times has a better feed ranking than one with less engagement. This post gets prime real estate on both a user’s feed as well as their Explore page. Facebook posts, too, rank better when consistently shared. In addition, posts that exhibit similar attributes to these viral posts or discuss similar topics often rank better as well. Brands that are in tune with their social echo therefore have a better understanding of their reach and how their content is being received.
Users are able to assign weight to each of these metrics based on their brands’ needs and goals and apply this formula to an existing news search. The result is a total score tallied from their coverage, as well as an average and individual article score.
Meltwater’s Custom Scoring tool also provides users with the ability to analyse trends in their earned media coverage, compare their coverage between periods, and prepare instant reports for management.
It is worth noting that Custom Scoring does not assign monetary value to these metrics. Unlike AVE, there is no way to directly associate earned media with the bottom line. However, Custom Scoring is still useful for PR professionals looking to aggregate PR value in a more holistic manner.
On the whole, Custom Scoring and other alternative measurement models provide an outlet for PR professionals looking to move beyond AVE. The adoption of alternatives allows PR professionals to evaluate the effectiveness of more diverse types of content and publicity available, therefore maximising the potential of the new media landscape.
Regardless of whether AVE is considered a sufficient indicator of PR value, the existence of new ways to refine PR measurement enable PR professionals to anticipate the need to better justify their work to management. With more believable, well-rounded indicators for success, PR organisations are able to work towards producing better campaigns that fall in line with business objectives.