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Where Does ROI in PR Come From?

January 9, 2012

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Public Relations is an industry from which it is not easy to determine an exact ROI from – and there’s many a PR Agency in 2015 that works strictly in media relations (which can be measured) – many like my firm 5WPR provides full service marketing and PR services. So what are some by products of PR that aren’t easy to provide an exact dollar figure to?

Influencer Relations

Malcolm Gladwell in his legendary book “The Tipping Point” called it “The Law of the Few” where he said:”The success of any kind of social epidemic is heavily dependent on the involvement of people with a particular and rare set of social gifts.” Economists call it the “80/20 Principle” – where 80 percent of the ‘work’ will be done by 20 percent of the participants.” Influencers move sales often times, and a good PR firm can connect clients to influencers – whether it’s the cool and connected moms (like we do for client brands like Bornfree), nightclub/entertainment mavens who can influence celebrities (i.e. Mark Birnbaum of EMM Group), or in politics rather than connecting to politicians, you reach their lobbyists or uber-influential attorneys like Jay Sekulow.

Introductions

A Good PR Company introduces clients to one another and connects people together. I learned last week that a client whom we had represented for 3+years until the midst of the economic downturn forced the company to pare budgets had recently completed a major deal with another former client of ours. It took time – as many big deals do, but it’s not something which is directly measureable when one looks at the “ROI” of PR.

Influence

We have a client who we have represented exactly 1 year – their annual budget with us is around $125,000 and we have done absolutely amazing work as the client regularly tells me – but on off days he’s complained to me that the company web sales from PR aren’t exactly where he wants them to be (and he cited it when giving us a minor raise for Year 2 of our program). And he says PR should move the mark more. Low and behold at his industry’s largest annual trade show one of America’s largest wholesalers sought the company out at the show and bought a huge amount of product – and cited the outstanding publicity program and a specific placement we had secured. Was thrilled to hear it – and yet another proof of PR’s tremendous ROI.

Of course, traditional and digital PR programs, media relations and all the rest are obvious ROI’s on top of the above bullet points. With Public Relations recently being named for the 2^nd year in a row as one of the most stressful jobs in America, all of us in PR have to do more to educate clients on the tremendous ROI which an effective Public Relations program has.

Ronn Torossian is the CEO of 5W Public Relations