Measuring Communication: ROI Meets ROC

There has been considerable time and effort invested by hundreds of people in attempting to demonstrate a return on investment for communication — advertising, marketing, public relations, and social media. It began as far back as, well, since someone first realized it might be measurable. In fact, any search on the subject will turn up any number of efforts, with some providing better explanations than others.

For my own part, I've been working, on and off, to refine a measurement formula for the better part of two years. My hypothesis is simple: the return on investment is related to the intent of the communication and the outcome it produces.

I | O = ROI

However, since last year, there have been several people who have noted that ROI means something different to business. In finance, for example, ROI means the ratio of money gained or lost (realized or unrealized) on an investment relative to the amount of money invested. When considering that definition, it becomes reasonably clear that ROI might be the wrong term for communication measurement, especially because not all communication produces outcomes that yield direct returns.

While this doesn't change the hypothesis, it does place a greater emphasis on establishing the connection between direct and indirect results because if we narrow the definition to only recognize direct returns, the greater portion of any communication plan will be diminished and working professionals will continue to misidentify incidentals such as conversations outcomes. Instead, I propose the real measure of communication is exactly that — the return on communication or ROC.

[(B • I) (m+s • r)/d] / [O/(b + t + e)] = ROC

For the next several Mondays, I will be writing a series about the above formula as illustrated within a free 5-page abstract, Measure: I | O = ROC a.k.a. The ROC, which defines a revised formula for communication measurement across advertising, marketing, public relations, internal communication, and social media. It has already been proven effective in measuring individual communication and ongoing campaigns.

Polarizing Futures: Apple, Facebook, Everyone

When Amazon first launched Kindle, it seemed to me that no matter how anyone felt about the product, the technology behind it represented crossroads with potentially polarizing effects.

It represented an opportunity to educate everyone on the planet (once there was a price point drop), giving them access to the best books ever written. And, it also represented an opportunity to enslave humankind by filtering future content and killing the last refuge of reader privacy at the same time. Some responses were expected...

"Enslave humankind"? I can imagine a few scenarios, but what did you have in mind?

Facebook Sacrifices Burger King

Burger King posted a Facebook application in early January that promised users a free Whopper if they publicly sacrificed 10 friends. Facebook disabled the campaign after 233,906 friendships were sacrificed, claiming the application did not meet users' expectations and the campaign was singling out users for ridicule.

Crispin Porter & Bogusky has since move to its third attempt to force feed a viral campaign in the last couple months. You can now send someone an Angry-Gram.

Apple Becomes Editor-In-Chief

Tom Krazit, a staff writer for CNET, recently outlined the details between the e-book author David Carnoy and Apple. Apparently, Apple rejected Carnoy's e-book for containing "objectionable content," which appeared to be a couple of uses of that four-letter word that starts with F.

Carnoy succumbed, saying the changes didn't impact the book. Apple has since approved the e-book now that the author removed the words that Apple considered objectionable.

Mack Collier Questions Listenership

Mack Collier, a social media purist for whom I have ample respect, questioned my interest in the 'Real-Time Communications Conference' because it was led by Pfizer Vice President Ray Kerins, someone who is virtually unknown in social media circles. Pfizer has been using social media internally.

Collier made the case that listening to people who were outside the circle might not be worth listening to. I'll be sharing some notes from the conference, which was broadcast live in real time, next week. There is ample content that is useful for businesses, students, and social media consultants alike.

Some of the discussion goes a long way in bridging the gap between business marketing and social media enthusiasts. Bringing very different ideas from different people, companies, and industries is a passion of mine.

Stanford University Was Right

While I might be an instructor at the University of Nevada, Las Vegas, I still have a passion for learning. And since I am geographically challenged in pursuing my education, I make ample use of multiple sources, including the content rich Stanford University section of iTunes.

I'll be writing more in-depth about these programs soon, but for now there is a thought that seems especially appropriate. As much as the Internet and social media have contributed to making more information and commentary from a greater number of sources available, it also allows participants to pick and choose their own content to such a degree that each participant can effectively select their own set of facts and create their own reality.

In other words, it might even be said we run the risk of self-isolating ourselves from knowledge that makes us feel uncomfortable. So I wonder, no matter if it is the smallest examples of gatekeeper censorship such as Facebook and Apple or even self-selected, what are people doing to ensure they continue to challenge themselves — even if it means listening to opposing viewpoints or taking the risk of being offended — in order to grow? What are your thoughts? I'd love to know.

Saying Nothing: Why Leadership Needs To Engage

Although a recent survey from Weber Shandwick has a small sampling with only 514 respondents, it mirrors several other studies that suggest the same — company leadership is still too quiet about the current economic crisis.

More than half (54 percent) of those surveyed said their employers are not talking about how the financial crisis is impacting the company and the majority (71 percent) said their company's leadership should be communicating about it more. The study also pinpoints that while company leadership is perceived to be not talking about the recession, 74 percent of their colleagues and co-workers are talking about it, with 26 percent expecting layoffs.

Last December, Watson Wyatt released a study that conveys the opposite. Overall, it found 77 percent of employers have already sent out or are planning communication on the impact of the financial crisis. More than two-thirds (69 percent) of these employers cited easing employee anxiety as one of the top two goals of their crisis-related internal communication, while nearly one-third (32 percent) cited earning employees’ trust.

Are more employers talking, but fewer employees hearing?

When the intent of communication no longer produces the desired outcomes (such as alleviating employee anxiety), it's time to reevaluate the communication.

In this case, communication managers and executives might consider that addressing the financial crisis is not the same as typical or motivational internal communication — it's crisis communication, even if the company is not directly impacted by the crisis occurring around it. And while not every crisis communication step needs to be followed, there are several very important questions that leadership needs to ask:

Are we acknowledging something is wrong? While instilling internal confidence is critical, employers cannot outright dismiss the recession. It has to be acknowledged, even if the company is unique, or the message may not be believed.

Are we satisfying employee interest? Employees are talking about the financial crisis. Government is talking about the financial crisis. The media is talking about the financial crisis. The sheer frequency of all this communication suggests company leadership needs to consistently communicate its position and direction. For companies wondering how many times they might reinforce job security to their employees, there is one answer: as many times as employees need to hear it.

Are we communicating empathy? Internal communication is not exclusively internal. Internal communication influences front-line communication and is influenced by outside factors. Even if company is one of several viewing the recession as an opportunity as opposed to a setback, the communication needs to express empathy. Employee spouses, colleagues, and point-of-contact customers may have very different experiences.

Have we included positive steps being taken to address the situation? During a crisis, even if the crisis is external, every message needs to be reinforced by provable data and a positive direction, regardless of what that data might communicate. People are always more receptive to a clear direction, even if it includes some bad news.

If these questions remain unanswered, any communication may be rendered ineffective. Ineffective communication is non-communication and may not even register with employees. Given that internal communication is permeable, non-communication can contribute to external public sentiment. It may even be why the RBC CASH (Consumer Attitudes and Spending by Household) Index reported consumer sentiment is at a six-year low.

"At a time when working Americans are concerned about their personal finances, their jobs and the overall economy, employees are looking for credible, candid information, and right now too few business leaders are filling the information void that exists,” said Harris Diamond, CEO of Weber Shandwick. “Employers have a great opportunity to communicate with their workforce about the impact of the economic situation on their companies as well as on employees."

Isn't it obvious? Employees are not just employees. They are also consumers and shareholders. And right now, they are looking to the private sector, as much as government, to stabilize the economy. At minimum, they need reassurance that their company isn't waiting for someone else to come up with a solution.

Related posts:

• Ragan: Survey: Leaders Fail To Communicate With Employees

• British Association Of Communicators In Business: Recession Demands More Emphasis On Internal Communication Not Less

• Jenna Boiler: The Importance Of Internal Marketing

• Geneva Communicators Network: Employee Communication Spending To Rise In 2009

• Copywrite, Ink: Thinking Internal: Watson Wyatt Study

Saving Lives: Communication Matters

Yesterday afternoon, a 1-year-old boy drowned and a 3-year-old boy nearly drown at a home-based North Las Vegas day care. According to the Las Vegas Review-Journal, authorities ordered a North Las Vegas day care to temporarily cease operations.

While this atrocity occurred earlier in the year than usual, it's not uncommon. Drowning is the leading cause of death among children ages 14 and under in Nevada.

In 2004-5, working with the Las Vegas Advertising Federation as director of public service, we were able to do something about it. Since child drowning was the number one under-served community awareness issue at the time, we used it to lead a year-long, three-topic public service campaign redefining accidents as negligence as a form of child abuse.

While the tone was hard, awareness matters. When people know it only takes 15 seconds for a child to drown, less time than it takes to answer the phone, or that drowning is also 14 times more likely to kill a child than a car accident, it makes an impact. It save lives.

The image attached to this post is the rendering of the print portion of the short-term communication campaign (print, outdoor, and radio). Copywrite, Ink. donated the creative and message. One of our clients, The Idea Factory, donated the first design. Publishing companies were invited to remove our mark from the advertisement and include our own.

Given how early the first drowning occurred in Nevada this year, it seems appropriate to share that this campaign served the community for two years. It is my hope someone might pick up where the Las Vegas Advertising Federation left off. While local media is always responsible in reminding parents of the dangers of pool safety, it tends to react after the first causality.

The same can be said about leaving children unattended in cars during the summer months, which was the second portion of what became an award-winning public service campaign. Again, it usually takes one casualty before the public begins talking about it, which is a great reminder why proactive communication still matters in an increasingly reactive communication world.

Commercializing The President: Everybody

First it was Ben and Jerry's "Yes Pecan,” and then it was Pepsi. And now, according to Brandweek, Ikea is jumping on the Obama brand wagon too.

Ikea's newest campaign includes out-of-home billboards featuring the "Embrace Change ‘09" slogan on local buses and trains. Ikea is also holding a "mock motorcade," touring the D.C. area Jan. 15-16, which includes strapping "furniture fit for a president" on top of vehicles. From Ikea's point of view, it's simply a good branding opportunity.

"We have never had an opportunity to do anything surrounding the message of change from a national standpoint," Marty Marston, public relations manager for Ikea told Brandweek. "[Obama's] notion of change and his commitment to fiscal responsibility match the Ikea philosophy of practical and affordable home furnishings for all."

But is it really a good branding strategy? Marvel Comics seems to think it's smart for Spiderman. And although BlackBerry didn't ask for an endorsement, it sure did appreciate it. But is it really a good thing? If you consider the fragile brand theory, then only if the original brand holds.

Thinking Global: Branding Local

For all the talk of a shrinking world, Nigel Hollis, chief global analyst at the market research firm Millward Brown and author of The Global Brand, has noticed a shift in the other direction.

"There are some underlying decisions people make when they decide to go global," Hollis told the International Herald Tribune. "One is that the world will become more and more homogeneous. That is just not happening. There's a lot of evidence that despite the spread of globalization we still live in a very localized world."

While the article recognizes some global campaigns, especially consumer electronics such as Apple's silhouetted dancers introducing iPods, can work; most brands, from food to personal-care products, make small adaptations in order to capture local appeal. In fact, even the on Web, communities tend to develop over time, creating a feeling of proximity that is based less on geographies and more on topics of interest.

Some companies seem to be catching up on the localization curve on the Web, even if they don't call it that. For example, Adweek noted that among the hundreds of journalists at the Consumer Electronics Show in Las Vegas, popular bloggers were being tapped by large companies with the hope of capitalizing on these localities. (Seth Godin might call them tribes.)

Prevailing thought, as reiterated by Chas Edwards, chief revenue officer at Federated Media Publishing, is that companies need to give up on the notion of control over their brands. The concept is not new. Companies never had control. And, when you step back and think about it, Hollis is saying something very similar — global branding is customized and localized.

Of course it is. As Phil Dusenberry, chairman of BBDO Worldwide, noted years ago: “Brand is the relationship between a product and its customer.” And that means branding, like all communication, works best when communicators and copywriters think in terms of reaching, or writing to, one person at a time. There is nothing more local than that.