After the dog woke up last night at 4am for some unknown reason I was unable to fall back to sleep, so naturally I thought about a proposal I’d been working on, particularly the client’s request for a methodology for measuring the impact of their communications program.
Requests like these are fairly common. Companies want to feel assured that the money they spend is having an effect, and agencies are eager to prove their value – and justify their fees.
But does anyone really have a magic system to distill into one number the impact on a company’s reputation of media coverage, social-media chatter, analyst opinion and other commentary? (Actually, the stock market does this about as well as any other measure as you’re likely to find, and it’s free. But it doesn’t help non-public companies.)
The other important question is whether the best measurement system is likely to be found in a big PR firm. Many of the large firms have invested in such systems over the years. But they’ve probably not kept pace with the growth of digital outlets and the rise of social media. And upgrading them is expensive, especially at a time when agency margins are under pressure.
Those who have adapted and are offering good tools are the marketing-technology firms. The sole purpose of these companies, which are not affiliated with large agencies, is developing measurement tools and related systems for marketing and PR campaigns.
This is similar to what Wall Street used to do with its financial technology. Not so long ago, every firm had their own proprietary systems for valuing complex securities, measuring risk and processing trades. They were expensive to build and maintain, and every now and then produced silly (or catastrophic) results.
Gradually, Wall Street realized that it was better to rent technology from expert firms whose only job was to build, test and refine these systems. Wall Street firms could focus on what they did best (e.g., trading, arbitrage, intermediation), and buy the best systems from financial-technology firms. That’s how Bloomberg became the giant we see today.
The same forces have shaped the communications world, too. Today, a company (or its advisors) can rent an off-the-shelf PR valuation system from one of the handful of vendors, like Vocus, Gorkana, or Radian6. It’s fairly easy to find a good system and tailor it to your budget and your needs.
Technology is no longer a source of differentiation when selecting a communications advisor. That’s a good thing too, because the choice should be about which advisor can give you the best counsel and execute your program to get the business result you want.