Measuring ROI in Government Communications

“We can no longer ignore financial accountability in the public sector. We must place a financial value on the impact our communications make.” -Guy Dominy, author of Measuring the Value of a Subscriber.

Financial accountability in the private sector usually translates into proving to your boss that the marketing dollars you spent translated to sales. In the public sector, especially in the time of tightening budgets and heightened citizen expectations, financial accountability means evaluating programs for the efficiency and impact they have on improving the citizen experience. In the age of the customer, we need to dig deeper into data to help answer questions like: “Who engaged with our message?” and “What did they do as a result?”

With those questions in mind, we teamed up with government clients in the UK to poll more than 11,000 of their subscribers on the impact of communications on their daily lives. Researcher Guy Dominy dug deeper into this data to spell out how government can assess financial value and prove the impact of their communications. The findings were released at govDelivery’s 6th Annual UK Public Sector Communications Conference in September.

Why Measure ROI?

Measuring the ROI of your communications in government is incredibly important because it allows you to assess the impact and value of your communications on the individual, organization and society as a whole.

• The individual audience member gains value from being better informed.

• The organization gains value of reducing the cost of service and creating behavior change that directly impact mission goals.

• Society gains value by driving behavior change that impacts communities on a larger scale, for example, reduced crime.

Delivering ROI and value in government can mean the difference between life and death. For example, a state government agency issues a text message weather alert during a holiday travel weekend. The text message campaign resulted in a smaller number of car accidents because the message provided the information to travelers to change a particular behavior – like avoiding a particular road or heading out on vacation early.

While the alert brought no explicit financial benefits to the organization, there is also a reduction in operational cost to first responders, fire department services, ambulatory care, police officers, economic costs to damaged city property, and even legal costs from issuing the communications.

In one of Dominy’s examples from the UK he says, “the financial value of preventing a fatal road accident is nearly £2 million, the value of preventing an accident with serious injuries is over £200,000, and one with only light injuries is a little over £23,000.”

Savings Associated with Digital Communications

In the report, Dominy estimates each digitally connected citizen saves the average UK public sector organization at least £1.51 per year, which is the equivalent to $2.31 per year in the United States. The estimated yearly savings for the typical public sector organization are substantial:

ORGANIZATION	ESTIMATED SAVINGS
County Government	£256,567 ~$391,700.84*
Unitary Government	£87,955 ~$134,280.90*
District Government	£26,904 ~$41,074.34*

*For an equivalent U.S. agency, this would be the amount in dollars.

Demonstrating Financial Value

The public sector’s interpretation of ROI and value is more complex than the private sector, but possible, by measuring the impact on cost (avoidable costs associated with telephone calls, newsletter printing), awareness (the value we place on keeping people informed) and behavior change.

Nearly 44% of survey respondents in Dominy’s report said an email influenced their behavior in some way. Attributing specific behaviors and furthermore, financial values, to communications isn’t always as straightforward as surveying your audience, but here are a few ways to gather the insight you need (for more details to build out your valuation strategy, read the guide):

1. Develop a logical argument – Sometimes it is enough to say: “Look, without our email alert how would they have known to do this?”
2. Compare trends or patterns – Gather some data and a spreadsheet to quantify the difference between what would have happened without the communication (by just continuing the trend line of past behaviors) and what actually happened.
3. Test and control – Divide up your audience and send a message to one group, keeping a ‘control’ group out of the message. The difference between behavior shows impact.
4. Assign and track costs – Track the costs/savings associated with saved staff time, replacing lost income, repairing damaged property, and so on.

Where to Get More Information…

Read the report “Measuring the Value of a Subscriber” to get step by step guidance for building your own ROI measurement plan. While the report’s focus is the UK government, its takeaways are universal, providing high-level insight into how the public sector can drive positive action and achieve significant cost savings through digital communications.