Klement Podnar, Marko Lah, and Urša Golob have a go at the old chestnut of whether marketing activities (in this case PR) can be linked to economic effectiveness.
Their article Economic perspectives on public relations appears in the lastest edition of Public Relations Review.
They say that “the money spent by the public relations department [is] often criticised on the premise that the future benefits…are uncertain and may not result in higher sales or company growth.”
By examining 5 ways of looking at the relationship between PR and business effectiveness ranging from its role in the social construction of meaning about the firm through to the economic impact of reputation of the bottom line. They identify helpful links between economic theory and PR practice.
Linking PR to economic metrics is feasible and desirable they say. PR can be shown to reduce transaction costs by making reducing the information and search costs of buyers and suppliers. Ultimately PR costs are an investment and investment is a necessary aspect of commerce.
The authors take a close look at various economic theories and how they might apply to valuing PR. They say this approach will allow “public relations practioners to successfully tie communications into business performance”.
I’m still pondering on the how to justify spending 30 minutes writing a blog post in terms of economic value though.