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Advertising Value Equivalency

There is huge debate as to what Advertising Value Equivalency (AVE) measures and what it’s usefulness is, here is a summary.

AVE is the rand value of what it would cost to place your editorial as an advert, it is that simple. It is not a measure of sentiment nor is it a measure of projected reach or Return on Investment (ROI). In fact AVE measurement is being replaced and outlawed in some countries for use as an effective measure when entering PR awards as the limitations are large. However we recognise that in South Africa this is the preferred measurement tool at the moment. As we update and find more effective tools we will add them to the mix.

How to Measure AVEs

To calculate, measure the space (column inches) occupied by a clip (for radio and television coverage, you measure time). Then multiply the column inches (time) by the ad rate for that page (time slot).

Thus is the cost of the advertisement that theoretically could have occupied the space (time) occupied by your editorial. Advertising Value Equivalency is a navigational metric: it can provide rough measurements that can help you navigate your PR program toward higher profitability.

Strengths

Many PR people incorrectly assume that AVE is an evaluative metric. That is to say, they assume that it can help them measure the profitability of their programs, because it appears to show a “dollar value” of publicity.

But the “dollar value” is not a measurement of value; it is a measurement of cost.

Weaknesses

AVE numbers can drastically overestimate or underestimate the “equivalency” in “advertising value equivalency.”

Consider that a highly positive article can be worth much more than a single advertisement in the same space, because readers consciously or unconsciously think of an advertisement as an instance of a company boasting about itself, and an article as an implied endorsement by a presumably objective and knowledgeable third party. So, from this perspective, AVE underestimates the value of editorial.

AVE clouds this issue by falsely equating advertising and publicity, which in turn reinforces the ancient but ever-popular fallacy that publicity is “free advertising.” In fact, it is not free and it is not advertising.

On the other hand, many PR people overestimate the advertising value equivalency of editorial coverage, because they calculate the cost of the space occupied by the whole article – even if only one sentence mentioned the company.

In summary, the use of this technique can perpetuate two major fallacies: (1) that editorial is “free advertising,” and (2) that dollar cost equals dollar value. Many senior managers believe these absurdities, and we marketers should always be looking for ways to debunk them, not reinforce them. If you’re trying to educate your management about how PR works, this technique is counterproductive.

Additional Weaknesses

The Institute for Public Relations in 2003 published a thoughtful and insightful report that raises two additional objections:

(1) What is the value of a negative story? (2) What is the value of the absence of coverage in cases where the PR people involved were working specifically to keep the story out of the papers? Those are very good questions.

(extracts from http://www.marketing-metrics-made-simple.com/advertising-value-equivalency.html)

Our Staff

Clint Griffin
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Digital Media Specialist, Media Monitoring, Strategist.
Social Media (Implementation & Strategy) Development and Web Design. Branding, Strategy, Copywriting. Corporate Training, SEO, Digital Strategy, Media Monitoring and Analysis.

Thabani Mwelase
Thabani MwelaseManagementSearchSocial ListeningWordpress

Senior Researcher, Office Management, Client Liaison, Training.
Thabani runs the Durban office and heads up a team of 5. Responsible for client liaison, logistics and final oversee of daily activities.

Angie Griffin
Angie GriffinDigital StrategyFinanceLogisticsMedia AnalysisReport Writing

Bookkeeping, research, reporting, analysis
With a background in marketing, advertising and merchandising, Angie manages the accounts and also compiles client reports.

Lorraine Baugh
Lorraine BaughResearchSearchWordpress

Senior Researcher
25 Years’ experience in media monitoring, all at SA Press Cuttings. Lorraine’s value and knowledge of the media landscape in South Africa is vast and her experience is invaluable in helping clients find what they need, fast.

Janelle Ruiters
Janelle RuitersPress MonitoringPrint MonitoringResearchSearch

Senior Researcher
23 Years at SA Press Cuttings, Janelle excels in Online as well as Press and Print Search.

Nicky van der Vent
Nicky van der VentPress MonitoringPrint MonitoringResearchSearchWordpress

Researcher, Archivist
Nicky has been with SA Press Cuttings since 1995, giving her 19 years’ experience in traditional media channels.

Nimrod Bhengu
Nimrod BhenguDigital MonitoringPress MonitoringPrint MonitoringSocial ListeningSocial Media

Researcher, archivist
The newest member of the research team, Nimrod has been with SA Press Cuttings since 2008.

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