Measuring Communication, Defining Outcomes

Since January, we've outlined several considerations to determine Intent and the execution of intent. But that is only part of the equation. The balance of the definition includes that the return on investment is related to the intent of the communication, the outcome it produces, and the cost to achieve those outcomes.

In social media and public relations (to some degree), there is a propensity to diminish the value of measurement based on the idea that indirect results are difficult to measure. As a result, there is a tendency is misclassify the operators of intent (such as frequency and reach) as outcomes.

Column inches are not really outcomes. Web site hits are not really outcomes. Comment counts are not really outcomes. Links are not really outcomes. Rather, all these things are generally a means to an outcome, publicity included.

“What kills a skunk is the publicity it gives itself.” — Abraham Lincoln

Never mind that Lincoln wasn't talking about animals. The publicity employed by a skunk is actually very effective, as the outcome it strives for is to be left alone. If it wanted to be a pet, only then could we say it has a public relations problem.

Most companies, of course, do not want to be left alone. Most of them want sales. When we could ask Leo Burnett, he might say that "advertising says to people, 'Here's what we've got. Here's what it will do for you. Here's how to get it.'”

But it's not that simple, not really. People have to know that you exist, care that you have something, and feel confident that they aren't supporting a bad corporate citizen. Of course, there is something else the Burnett quote points to. He did not say that advertising is sales, only that it leads people to where sales occur.

With the exception of online stores and direct response marketing, most advertising, public relations, and communication does not lead directly to sales. It does, however, lead people to seek out a product, include a product among their purchasing decisions, have a favorable opinion about a company, tell other people about it (as you want them to be told), listen to the company when it has news to share, and hundreds of other actionable events and changes of behavior or outcomes from defined publics.

Outcomes are measured by the actions and opinions of a defined public.

The Southwest airlines Ding! widget is one example. As a communication tool, it promises to deliver exclusive offers to a select audience (people who download the widget). Sometimes, these offers change behaviors in that a low fare offer might prompt people to visit a city they didn't consider before or place reservations in advance to a city they intend to visit in the near future.

The number of people who have downloaded the widget defines the reach; the number of sales attributed to the widget defines the outcomes. In 2007, $150 million in sales were directly attributed to the widget.

Naturally, the widget doesn't communicate in a vacuum. Other communication efforts ranging from campy advertising to its blog, all have the intent to distinguish Southwest as being casual, friendly, fun, and focused on lower prices. This intent has served the airlines since 1972. Today, it includes an early adoption of social media.

While the whole of its communication efforts help define the intent and reinforce its brand equity, the return on the widget can be directly tied to ticket sales vs. the cost to develop and promote the widget. Other efforts from other organizations might be measured differently.

For example, if an organization wanted to expand its engagement with a specific demographic and sent out a news release, then the measure of that news release might be the response from that demographic rather than the frequency or reach of the publications that ran the story. (It might also be a change in sentiment by the demographic.) How people beyond the demographic respond to the story might also be valid, but ancillary to the real measurement.

In the weeks ahead, we'll present what might be included to determine the cost to produce such outcomes. But before I did, I thought it was important to provide a baseline of what an outcome is and what it is not.

Specifically, an outcome is an actionable event that ranges from indirect such as a change in opinion to direct such as sales when confined to a specific offer. In other words, the outcome is what we do when we learn the skunk has a potent spray, assuming we are even in the skunks demographic.

Banking On Troubles: Waggener Edstrom Worldwide

According to a consumer poll conducted by Waggener Edstrom Worldwide and RT Strategies, a mere 8 percent of consumers have full confidence in banks and financial services companies. The firm compares the low water mark to a 31 percent confidence level reported in 2006 by the University of Chicago National Opinion Research Center.

Highlights From Waggener Edstrom Worldwide Nationwide Consumer Poll

• 44 percent of respondents said they heard something from the industry but felt more negative after hearing it.
• 11 percent of respondents heard something from the industry and felt better about it.
• 38 percent of respondents said they have heard nothing directly from the industry at all.

Waggener Edstrom Worldwide concludes that media coverage and/or advertising is shaping public opinion more than direct communication from the industry and that authentic and credible communication positively influences widely held opinions about the industry overall.

"Ironically, at a time when the financial services industry has the most at stake, its communications with consumers and policymakers have descended to a strikingly low level," said Torod Neptune, senior vice president and Global Public Affairs Practice leader at Waggener Edstrom Worldwide. "Perhaps one of the most jarring findings in this survey is the sheer lack of industry leadership in communicating what financial services companies are doing to aid in a broad-based economic recovery."

The consumer poll mirrors a cursory public sentiment report we conducted for a national bank last month, which demonstrated the financial services industry as a whole is causing individual bank brand erosion as a direct result of accepting TARP funds. Areas of concern across the industry include mismanagement, financial waste, security, trust, and longevity.

Where we differ from Waggener Edstrom Worldwide is in its recommendation that there is an opportunity for financial services leaders to step forward in the midst of this storm and proactively communicate a message of trust. Unlike most messages, trust cannot be communicated as an industry as much as it has to be earned at a ratio of one-to-one.

What is also missing from the Waggener Edstrom Worldwide conclusions is that some banks are communicating direct to clients. And, by in large, there are reasons that TARP banks have remained largely quiet. Specifically, not all of them needed TARP funds. The reason they accepted the funds is sound, but it does not resonate with the public while individual banks are targeted for public floggings.

So is there a solution? Sure. But the opportunity isn't to step forward in the midst of this storm and proactively communicate for the industry in an environment where it's good sport to take shots at financial services, where individual bank decisions can erode the credibility of whomever picks up the mantle, or where government has positioned itself in an adversarial role. Instead, an individual bank needs to focus on what it can manage — its own communication to employees, customers, and prospects.

In addition, the message wouldn't be one of trust, but rather one demonstrated by reliability and longevity. And by "demonstrated," I mean with evidence that suggests it is provably true. Each bank, of course, needs to develop a message based on its own situation and core values, assuming it hasn't drifted too far away from those.

Interestingly enough, the less reported on portion of the study reveals that consumers appear willing to give the industry the benefit of the doubt on questions about industry practices, such as the use of TARP funds. That tells me the 8 percent finding that is carrying some headlines today isn't so much about the industry as much as it demonstrates how popular it is to say "I don't trust banks, um, except the one that has my money."

Understanding B2B Blogs: Case Abstract

While there is always plenty of buzz surrounding social media, an integrated approach to marketing and communication still works best to drive companies forward. And as long as companies understand that social media is a flexible tactical tool rather than replacement strategy, they will see results.

Despite substantial limitations, we recently completed a startup blog for a niche green-solution engineering company in about 90 days. The initial focus, after market analysis (listening), was to establish a blog capable of capturing the interest of clearly defined audiences: manufacturers and regulators in the short term; environmentalists over the long term.

Why blogs work as a niche B2B solution.

In as little as three months, visitation grew from 0 to 600 visitors per month (outpacing the company's Web site by as much as 4-to-1), with five subscribers and frequent return visitors. While that might seem insignificant for people who focus on traffic, traffic was inconsequential. What was important was that one weekly post succeeded in capturing interest from a very specific niche audience, with the medium length of every visit around five minutes.

We also knew they were the right audience based on analytics alone. In addition to the U.S. Environmental Protection Agency, South Coast Air Quality Management District, State Of California Air Resources Board (among others), the majority of visitors included major engineering firms, manufacturers, food processors, and universities. As an additional footnote, the blog initiated direct contact with two environmental reporters and one congressman, specifically interested in EISA Section 471.

Based on the company's median contract rate, the program could eventually return as much as $50 to $1 hard return on investment with one contract and a significant return on communication (ROC), long term, assuming the company followed through on recommended integrated marketing tactics. There was also a high probability it would take a industry expert position in 180 to 240 days, given its area of expertise was an underserved and underreported niche within the engineering industry.

Specifically, their audience is searching the Web for content that nobody else was providing. At least, for now.

Blogs aren't ends unto themselves. They are beginnings.

Of course, blogs alone do not necessarily generate direct results. As noted, it takes an integrated approach.

Given that, in this case, the company could identify visiting companies, it could have looked up the most appropriate contacts, mailed informative value-driven marketing material, and then followed up with a introduction call. Even in cases where the material might not reach the exact visitor, the dual contact points could eventually inspire dialogue within the targeted prospect.

Specifically, by creating impressions with different people inside a targeted company, the communication will eventually converge as needs in this area arise. And, when combined with additional programs already in place (such as trade shows, workshops, and targeted advertising), a niche engineering subcontractor could easily become the focus based on the quality of its shared content, the frequency and diversification of its impressions, and the potential demand generated by the passage of green energy grants with the recent passage of the Stimulus Package.

Long term, the engineering company can still expand its social media program to social networks, with an emphasis on those based on monitoring and, more specifically, blog reader information. (Not always, but often, our readers ask us to join or try out specific social networks, groups, etc.) In other words, they could become the hub of the existing niche interest.

Early results demonstrate momentum, despite limitations.

What struck me as especially significant about this case was the steadily increasing interest despite severe limitations. Limitations included:

• An incomplete and fragmented Web site without coherent organization (which likely diminished the positive impressions created by the blog).
• The lack of a clear connection between the startup blog and Web site (e.g., a RSS feed or widget would have increased its site traffic by including the blog content on the site).
• The lack of time availability from the company's engineers, even though the commitment could have been as little as one post every three months from each, supported by related content in between, as outlined by the initial program plan (e.g. other than two contributions from myself, the most popular entries were written by the engineers).
• The missed opportunity in promoting trade shows attended where the company was an exhibitor (the point designer claimed they didn't have time to provide basic information, such as booth number).
• The undervaluation of how related content (e.g., how the fluctuation of natural gas prices indirectly increases the expense of a prospect's operations) by one party could position them as a solution-driven company, much like EISA Section 471 posts did.

Going forward, the company can address these limitations and better formalize its integrated marketing approach. The point here, however, isn't to focus in on these as deficiencies as much as it is to demonstrate that despite such limitations, the blog still managed to capture the interest of the desired audiences.

So, as long as company staff maintains the program until these areas are fixed, they still have a successful though slower growth rate program that has a high ability to capture organic traffic and niche audience interest. Further out, long term, the recommended path would be to build out into other social media areas based on niche audience participation.

Small companies sometimes underestimate marketing.

One of the reasons this was a short-term program was because of a common challenge among small companies. Often, they claim to become too busy to be concerned with marketing but not busy enough to sustain a marketing budget. Years ago, I was guilty of such deficient thinking myself. Nowadays, I know better. Marketing not only is a priority, it is the lifeblood of business. Without it, companies eventually fade away or fail outright.

Where social media is especially successful is it helps maximize B2B marketing efforts while reducing the overall budget. And even if it is not integrated, it can, at minimum, capture more interest than a static Web site because content adds value and connections increase engagement over time. It not only makes sense, it's common sense.

Ruffling Feathers: Jeremiah Owyang

Jeremiah Owyang, analyst for Forrester Research, left dozens of people scratching their heads in his coverage of what seems to be a crisis looming in the background at Mzinga. Mzinga, if you don't know, manages more than 14,000 online communities for companies such as Virgin Media, GMAC Mortgage, and John Deere.

According to Owyang, he has been been hearing from multiple sources that Mzinga is undergoing some changes, which includes the voluntary leave of the CMO. Under normal circumstances, this is common fare for company coverage. However, these circumstances aren't common as Owyang took his coverage a step further.

"It’s my obligation to have my clients (sic) best interest in mind, and this is the fastest way for me to reach them, by using the tools where we’re already connected," wrote Owyang. "I strongly recommend that any Mzinga clients or prospects stall any additional movement till they brief me next Monday."

In the very next line, he promises to be fair and balanced. And, more perplexing to some, he teased the post on Twitter by more or less stating that people should not perpetrate rumors. Owyang has since apologized for his post.

So what went wrong for Owyang and what can be learned?

One reason reporters tend to become cynical is that they often learn insider information that they cannot confirm. So, unless reporters can substantiate any speculation with fact, they might leave an issue on the back burner until something finally surfaces (if it ever does). Or, they might share what their insider information is, but stop short of calling the game.

What seems to be is that Owyang, who says he had the best intentions, attempted to play the middle. He decided against sharing the insider information but wanted to protect his clients (and companies beyond his clients) based on the information he had obtained. It might seem like a good idea, but it's an extremely dangerous position because it fails on both fronts.

I might point out that this says nothing about Owyang as a person. There are plenty of people who will defend him as one of the most respected names in the social media industry. However, just because people are ethical and have good judgement doesn't exempt them from mistakes. And this was a mistake.

While having a conversation about this subject with Christina Kerley (who brought this story to my attention) on Twitter, I pointed to Article 8 of the International Association of Business Communicators Code of Ethics, which suggests "Professional communicators protect confidential information and, at the same time, comply with all legal requirements for the disclosure of information affecting the welfare of others."

I didn't elaborate then, but I will now. Either Owyang had compelling information that affected the welfare of others, which would require it be shared. Or he did not, which would have precluded him from making such a heavy handed recommendation.

So to answer Jon Burg's question — should a blogger share an important or compelling rumor? — it depends. Personally, I try (with admittedly some slippage now and again) to never use the word "should," but if a blogger (or anyone) has compelling evidence, especially if affects the welfare of others, then they are better off sharing it, with qualification, to justify any recommendation on their part.

In other words, if "that" then "this" is fair. But Owyang only alluded to having "that," which means his "this" overreached, making it look like a power play from an industry analyst apparently unable to get the answers he wanted, using mostly Twitter to do so.

As for what could have happened, it seems to me that notifying clients would have best been left to private communication. Any public comment might have recognized that if you are in for a pinch, you are in for a pound. And, on something this sensitive, unless you cover public communication like I do, social media isn't the best fact-gathering mechanism. Sometimes you have to pick up the phone a few times.

So what went wrong for Mzinga and what can be learned?

While Mzinga probably didn't deserve the recommendation that could have caused a much larger crisis than whatever crisis it may be facing, the company hasn't performed much better in managing its communication. There is obviously some sort of crisis (one they intended to answer on Monday) and an unwillingness to address the situation sooner is paramount to confirming it.

Mzinga employee Dave Wilkins' comment on Burg's blog presents one revelation ... "… I'm not really in the right position to respond officially anyway. I do want to clarify a couple of things however."

What's the revelation? In the interim between Mzinga not addressing rumors and promising to address the rumors, the company's employees are left with the daunting task of addressing issues that they are not in the right position to address, which just adds more fuel to the fire.

Some, it seems, have taken to leaving nasty anonymous comments on Owyang's blog. Others demanded apologies while poking back at Owyang. And even more, vendors included no less, chimed in too. Heck, even "former" CMO Patrick Moran is speaking on behalf of a company that has left its communication to reckless abandon.

How reckless? Someone asked me "What leads you to believe that this is a 'crisis'? Is it because the rumor mill says that it is? While the company may be going through some changes, I have seen nothing other than the rumors here and on JKO's blog that indicate there is a 'crisis'."

Give me a break. When rumors of a dramatic and possibly negative change become the only message, overshadowing everything else that the company does or says, it is a crisis. Denial doesn't make it not a crisis; it only makes it louder.

If you don't manage the message, the message will manage you. And from the looks of it, Mzinga isn't managing this one. If it had, there would be no Owyang post to be ruffled about.

If you're still confused, here's the oversimplified version.

1. Mzinga has some sort of a change ahead (small, big, whatever) and did not properly address it, which led to increased negative speculation and rumors. The fact that they promised to address it (Monday) suggests something is going on.

2. Owyang had some information, and then attempted to balance "not wanting to share it without verification" and "wanting to share it because it could impact his clients, colleagues, etc." In attempting to do right by everyone, he did right by no one. He also apologized; lesson learned.

3. Mzinga is now making a tremendous mistake by offering no easily identifiable response, leaving employees and vendors to deliver what can only be called runaway crisis communication, which promises to end badly for them. The last published press announcement was on Feb. 26.

In sum, for as much as Owyang admittedly did the wrong thing, Mzinga's crisis communication management is as much of a train wreck as the Jobster crisis communication management three years ago. The whole situation reads like amateur hour, which makes it all the more worthwhile to cover as a case study. What's the takeaway today? If you don't know what you're doing, hire someone who does.

Playing Favorites: BloggersUnite.org

Although I was unable to attend SXSW this year, I was able to send a small piece along in my place. (For those that don't know, the SXSW Interactive Festival features five days of panel content and parties, simultaneously with film and music festivals in Austin, Texas.)



My small piece was a quick and quirky animated video that illustrates the history of BloggersUnite.org, which started as a BlogCatalog initiative two years ago. But more than that, it demonstrates how ideas are made real via the Internet.

Simply put, one person has an idea, shares it with others, and then each person uses their unique experiences to play a role in making it a reality. Over time, other participants become involved, engaged, and lend a little of themselves to the overall project or program or social network. When that happens, the realities often turn out better than anyone expected.

As a side note, there was another takeaway for me. After the avatars used in the piece became distorted across several video editing programs, I turned to Keynote for the first time. Other than having to export the project more than a dozen times before the audio bed synced, Apple's presentation software turned out to be a surprisingly versatile tool in getting the job done.

It's amazing what can be accomplished with one Apple program and a little coffee during the course of one evening from concept to creation. Keynote certainly helped me rethink what's possible from a presentation program. You can find the best quality presentation on our site through June 30.

Measuring Communication, Equation Influencers Part 2

“Brand is the relationship between a product and its customer.” — Phil Dusenberry, former chairman of BBDO Worldwide

While more formal definitions might include "the assortment of qualities that differentiates the brand from other commodities, which translates into higher sales volume and higher profit margins against competing brands" or "marketing effects or outcomes that accrue to a product with its brand name compared with those that would accrue if the same product did not have the brand name," Dusenberry’s proposition defines brand equity succinctly.

Brand equity is derived from what people think and feel about a particular person, product, service, or company.

In recent years, an increasing number of people misdefine brand as an identity, image, mark, or logo (e.g., as in a cattle brand). However, it's none of those things. For the relationship between those things and their relationship to a brand, it might be worthwhile to refer to an older brand primer post, which includes a in depth comment from a trademark lawyer as well.

For the purposes of measurement, a better definition that reflects Dusenberry’s proposition is that a “brand” is better thought of as the net sum of all positive and negative impressions. For example, when people think of Apple, they have an immediate emotional reaction to what Apple represents as it relates to them. It may be positive or negative or neutral or degrees in between.

The impact of brand equity on the whole of communication can be extraordinary. Simply put, Apple has developed a brand that is powerful enough that anything it does is news. The same can be said about Apple CEO Steve Jobs. It's simply not so for the bulk of many of other companies.

Brands have a two-fold relationship to the overall communication strategy.

In the ROC equation, brand equity is demonstrated as a second influencer that impacts the whole effectiveness of communication. Specifically, Brand times Intent (message plus suitability times reach) divided by duration or B • I (m+s • r)/d. The more powerful the brand, the more people take notice.

However, planned communication can also negatively impact a brand. For example, Pepsico's Tropicana package redesign had a dramatically negative impact on the brand relationship between the product and the consumer. Interesting enough, the Arnell Group didn't change the brand as much as they changed the identity of the product, which came to symbolize the relationship that consumers felt toward the product.

What the Arnell Group never seemed to consider (or Pepsico, which seems to be redesigning its entire portfolio of products for the sake of change), was that its most loyal consumers identified the orange with the straw imagery much in the same way Coca-Cola has infused itself into the psyche of American culture and around the world. In sum, the package redesign diminished the brand equity.

Over-reaching creative, erred publicity stunts, and forced viral campaigns all have a tendency to diminish brand equity. Why? Such efforts tend to push for frequency and reach at the expense of the value proposition and message, which are critical components in establishing a brand promise.

An interesting side note about brands and their meaning to people.

We've had a laugh or two over the Microsoft Branding Parody that pays homage to Fred Manley's “Nine Ways To Improve An Ad.” However, there is something else to think about.

Over time, Microsoft's brand became so entrenched with a "generic" identity that it became difficult for the company break away from it, even with the help of Jerry Seinfeld. However, as Microsoft recently learned, even a generic brand might avoid lowering the bar too much as it did with Songsmith video.

The reason this is relevant is because of another theory we've had in the mix for some time. The Fragile Brand Theory suggests that it is less important to stick with your brand choice (innovative and elusive like Apple or a generic giant like Microsoft) than to switch and swap identities that confuse your publics. In general, people develop relationships with the sustainable familiar, regardless of the brand that people, products, and companies try to project.

If there is a distinct takeaway separate from the measurement abstract, it is that as much as brands influence the impact of communication, communication tends to influence brand over the long term. Dramatic juxtapositions of established brands, regardless of what they are, do not end well.

Download The Abstract: Measure: I | O = ROC

The ROC is an abstract method of measuring the value of business communication by recognizing that the return on communication — advertising, marketing, public relations, internal communication, and social media — is related to the intent of the communication and the outcome it produces. Every Monday, the ROC series explores portions of the abstract.