Can you compare the sales impact of a PR mention to the sales
impact of a TV ad?

Ronnie Choudhary, Strategic Modeling & Forecasting Specialist for
The Miller Brewing Company, has devised a formula he believes
does just that.

According to Choudhary, the PR department at Miller Brewing was
not isolated from marketing and advertising, but they were not
exactly on the same page either. He says, "PR is rarely
included in management planning, partly because there has been no
way to measure its results. From a corporate point of view, not
much importance is given to PR when thinking about an overall
brand strategy,"

However, Choudhary suspected data would prove that PR was more
critical to brand launches and sales than anyone thought. He
explains, "Having someone else talk about your brand has more
impact than talking about yourself through advertising."

Over the past year he has developed new formulas to measure PR
effectiveness.

"In the past, we looked at gross impressions and favorable
comments, and other PR metrics," Choudhary says, "but we never
looked at the impact on the bottom line."

First, Miller Brewing now takes into account five details in
their PR coverage to help them measure the net effect of
particular PR impressions:

1. Extent of coverage
Where was the article placed? How many readers saw it? Was
the article picked up by other newspapers or magazines?
Which ones?

2. Nature of the visual
Did photos accompany the article? How many photos? Were
they in black and white or color? What was the size of the
article and of the visual?

3. Dominance
What was the placement of the article? Was Miller Brewing
mentioned in the headline? Was it on the front page? What
section did the article appear in? Was the article at the
bottom of the page? The top left corner? Was it buried in
the middle of a section?

4. Initial mention.
When in the article was Miller Brewing and/or the brand
first mentioned? In the first line? The first paragraph?

5. Tonality.
Was the article or editorial positive or negative?

Values are given for these attributes to reach an overall impact
score. The overall impact score is then multiplied by the
magazine or newspaper’s circulation.

Miller Brewing bases advertising-to-sales metrics on a regional
basis, so the new PR calculations also now focus on regions. If
the PR mention is in a national publication, Miller Brewing
breaks down circulation by each sales region to determine impact.

Then by using a standard regression model, Choudhary isolates
product sales in that region and compares that to other regions.

Next, to determine return on investment, he includes the
following three metrics:

1. Contribution
What percent of the total volume of sales is attributed to
the medium?

2. Effectiveness
How much sales volume is generated per million of
impressions?

3. Efficiency
How many dollars are brought in from the advertisement/PR
article vs. how many were spent?

"You take these three measurements and compare them across a
number of different brands and you begin to see how PR can be
effective if integrated into a total strategy," Choudhary says.

"By isolating and reporting on the individual medium, we can look
at the net effect of PR and TV in the same model," says
Choudhary.

Choudhary is quick to point out that measuring Internet PR is
still a work in progress for this regionally-based system,
because much of the "Internet can’t be mapped to a particular
geographic place."

So far Choudhary's new measurement system has revealed that PR
efforts can create far more substantial lifts in sales than
anyone at Miller Brewing previously believed.