Cost effectiveness of PR solutions

Cost effectiveness of PR solutions

There is no secret to generating press. Although, the way some public relations people carry on you may be fooled into thinking there is.

Like everything else, it is simply a matter of understanding the industry and knowing what important steps are necessary to get a story about your organisation published.

Let's start with the basics. All editorial is free. You only pay for advertising. All stories written in a publication are classified as editorial. They are either stories submitted by industry participants, like yourself, or stories written by the journalists who actually work for the newspaper or magazine.

Stories submitted by industry participants are called press releases. Paying for an advertisement does not automatically mean you will have your editorial accepted and run or published, despite common misconceptions.

It is important to understand that advertising and editorial play different roles in the promotion of a product or company. Advertising generally aims to sell the benefits of the product, displaying the subject in the most favourable light. Editorial, however, aims to inform and educate consumers about a subject, flaws and all. Advertising is important to your company's success, but it should never be viewed as a complete solution to all your marketing needs. It should always be used in conjunction with marketing and press activities for maximum dollar benefit.

Advertorial is an industry-specific term for a paid advertisement which looks like editorial. It is generally used in a derogatory sense to describe a press release which is full of sales hype.

A public relations role within your organisation can either be handled by a dedicated PR person in-house, by a PR consultant or by extending the duties of an existing employee.

There is a vast difference in costs between the three options. For example, a dedicated PR person could have a salary upwards of $55,000 in Melbourne and $65,000 to $70,000 in Sydney, depending on the size of the company. A PR consultant charges anywhere from $70/hour in Melbourne or from $110/hour in Sydney, while a freelance journalist charges about $400 to $500 for 1,000 words.

The standard payment set by the Media Entertainment and Arts Alliance is currently $565 for 1,000 words or less and $0.57 per word thereafter. Alternatively, it costs $226 per day, $151 per half day or $57 per hour. It generally takes about four hours or more, including the interview process, for an experienced journalist to write 1,000 words.

For smaller organisations, it is obviously cheaper to manage your own PR requirements and subcontract the more technical aspects of the role, such as the actual writing of stories or press releases, to freelance journalists. This is exactly how most PR consultants operate anyway.

The disadvantages associated with using freelance journalists is that it is up to you and your in-house support staff to do the administration associated with packaging the press release with a photograph and sending it to more than 40 computer publications published in Australia.

This may not sound too difficult, yet it is a task which can easily take up to two hours per press release, even in the most automated office.

The following basic formula determines whether you receive good value for your public relations dollar, and determines which method might be most suitable for your organisation. It compares the cost of advertising with the cost of generating press by assigning a value to both. Although simplistic at first glance, over time it has proven to provide an accurate assessment of productivity in an industry which can avoid detailed accountability.

First measure how many column centimetres of press you receive, or you would expect to receive, per month. Include photographs and headlines. (A one-page feature story in a typical industry newspaper, including photograph, comprises about 170cm, while a short product announcement of two or three paragraphs totals about 7cm.) Determine the cost of achieving this amount of press per month. This cost includes the salary of a PR person and/or outsourcing costs. Do not include the cost of the associated photography. Divide the number of column centimetres by the cost of producing those centimetres. This will produce your cost per column centimetre per month (

Your public relations costs should consistently average less than $30/ A good PR consultant should be able to bring these costs to below $10/ for an average size company and to less than $5/ for a larger organisation. It costs approximately $30/ to advertise regularly in any one of the major weekly computer newspapers, plus the cost of producing the advertisement.

For the purpose of this evaluation, we equate the cost of producing the advertisement with the cost of producing the photograph in order to cancel them out. If your public relations costs are more than $30/, obviously it's cheaper to run an advertising campaign.

Next column I'll explain a proven PR methodology which is capable of generating up to one page of press a month in less than four hours.

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