For corporate communications (comms) professionals, demonstrating the return on investment (ROI) of their efforts has always been a challenge. This is especially true during economic downturns when communication activities are often seen as expendable. Traditionally, measuring the impact of comms relied on outdated methods like Advertising Value Equivalency (AVE), which doesn’t accurately reflect the true value proposition.
This disconnect between comms and business outcomes can create tension. A 2023 Global Comms Report revealed that 61% of Chief Communications Officers (CCOs) cite the inability to effectively measure impact as their top challenge.
The Challenge: Perception vs. Reality
Traditionally, marketing has been viewed as directly impacting sales through customer-facing campaigns. Corporate comms, however, focuses on influencing a broader range of stakeholders, aiming for long-term gains. This difference in focus makes it harder to quantify the value of comms activities.
For example, improved media coverage or positive public perception doesn’t always translate directly into increased sales. This gap in understanding can lead leadership to question the value of comms investments.
The Missing Piece: Data and Analytics
Another factor hindering comms is these departments’ lack of data analytics skills. Defining comms impact requires monitoring, analyzing, and understanding data. Proving value becomes even more difficult without a clear link between activities and outcomes. Reports indicate that many comms departments lack the necessary data skills to bridge this gap.
The Rise of Comms Tech and New Tools
Fortunately, the landscape is changing. Today, comms departments have access to tools that can help quantify their value. Tracking and collaboration platforms can provide insights into stakeholder sentiment, allowing comms to demonstrate its value even in challenging economic times.
Additionally, CCOs are starting to leverage “commstech” solutions. These tools make comms departments more agile, data-driven, and equipped to analyze information. By adopting these new tools and platforms, comms teams can optimize their activities and demonstrate their business impact to leadership.
Beyond Sales: Redefining Business Impact
While a direct impact on sales is the ultimate measure of commercial value, it’s not always the most realistic goal for comms. In today’s stakeholder-driven world, companies recognize the importance of non-traditional forms of value. Short-term financial gains are still important, but long-term stakeholder impact is gaining traction.
This broader definition of business impact can encompass factors like a company’s ESG ranking or its ability to attract and retain top talent. These improvements enhance a company’s reputation and benefit the bottom line by reducing costs and fostering stakeholder loyalty.
Data Savvy: The Key to Demonstrating Value
So, how can comms teams effectively demonstrate stakeholder impact? The answer lies in data-driven solutions that track stakeholder sentiment in real-time. These platforms allow comms professionals to measure the impact of their activities and external events on stakeholder perceptions, both immediately and over time.
Previously, such continuous research and analysis were expensive and time-consuming. However, recent advancements have automated and accelerated this process, making it more accessible and cost-effective.
These innovative solutions can integrate with other data streams, such as social listening, content management, and media monitoring. Consolidated dashboards provide a holistic view, enabling companies to optimize activities, respond quickly to events, and proactively mitigate risks.
This real-time data gives CCOs a clearer picture of the value comms brings to the organization. With this data-driven evidence, companies are more likely to allocate budgets effectively and invest in initiatives with the greatest impact.
Leading the Way: Examples of Success
Several companies are already making significant strides in demonstrating the value of comms:
- Audi: Utilizes real-time KPIs to guide communication strategies, fostering agility and a data-driven culture within its global communications function.
- Siemens Healthineers: Developed a comprehensive business intelligence dashboard that integrates various data sources, providing a real-time picture of communication activities and their impact.
- Coca-Cola: Employs a strategic approach by implementing continuous measurement throughout all stages of communication, from objectives to impact.
The Future of Comms: Embrace Change and Upskill
The communications function is undergoing significant change, and the emergence of technologies like generative AI might seem like a threat. However, this is an opportunity for comms professionals to embrace change and transform themselves into data-driven powerhouses.
By upskilling existing teams, recruiting talent with data expertise, adopting new tools, and developing a clear strategy for impact measurement, comms departments can finally shed the “cost center” label and solidify their position as invaluable strategic partners within their organizations.
The ability to articulate and demonstrate value has long been challenging for comms professionals. But with the rise of data-driven tools and a shift in understanding the true impact of communication, the dream of being recognized as an essential asset is finally within reach.
