For most businesses, the whole point of them even starting the business was that the owner felt that they could receive a positive return on investment(ROI). It would make no point in every starting a business if you were under the assumption that you would be losing money. To best find out on how your return on investment is or the the best way to have a positive return, it is important that you have proper evaluation methods. Public Relations plays a very strong part in the overall growth of a business and growth plays a factor in ROI. According to Guy Kawazaki, “Brands are built on what people are saying about you, not what you’re saying about yourself. People say good things about you when (a) you have a great product and (b) you get people to spread the word about it.”
A problem with PR people is that they do not always correctly evaluate to come to a good conclusion on ROI. Accroding to Molly Borchers many PR people evaluate and come to their conclusions by measuring tactics like reach and number of placements, rather than outcomes (like increase in sales or website conversions). One good thing that PR does do for a company is crisis management. A good way to lose all of your investment is to have a crisis take place with no plan in place to fix it. With good evaluation from your PR, you can prevent or save a crisis from happening which in return will save your business and protect your investment.
Stong PR also can help you strenghten your relationships with shareholders which should cause your stock value to increase which means even more return on your investment. When evaluating, it is important that as a PR person you are always making sure that your strategies can be measured. If you can’t measure what you are doing, then you add extra risk to the ROI and could be hurting the business. Social media is also a good way to use PR to see how your retun on investment is. If your business is receiving a lot of retweets, follows, and interactions between people especially your customers, this could have direct correlation to how well you busniess is being accepted and if you are receiving any type of return on your investment. Another really big problem for a business could be how exposed they are as a whole. If you are not making the amounf of money that you hope to make, it could be because you are lacking visibility or credibility within your field(Mike Santoro). Good Public relatinos will allow your business to have a lot more potential exposure and may also cause others to want to invest in your business which will allow your return on investment to be greater.
The main thing is that it is important to evaluate ways to best help you have a positive return on your investment. Using good PR techiniques is a great way to help your business gain better exposure and recognition, while also looking good to stakeholders and this should allow you to have the best possible ROI.
Mike Santoro, 8 Ways To Measure Return On PR Investments. http://www.cmo.com/articles/2012/2/23/8-ways-to-measure-return-on-pr-investments.html
Molly Borchers, Measuring the ROI of Public Relations: Five Experts Weigh In. http://www.huffingtonpost.com/molly-borchers/measuring-the-roi-of-publ_b_5021600.html
James Cooper, PR Measurement and ROI — A Reality? http://www.agencypost.com/pr-measurement-roi-and-a-reality/