It’s slightly surprising to many that there is no simple rule of thumb for the cash value of AR.

Of course, there are complex systems to look at the cash value: one of these is win-loss analysis, another [which uses a model based on historical data from win-loss analysis] is Efrem Mallach’s AR Value Calculator. However, all these valuation methods involve detailed differences between different markets and firms and cannot be resolved into a single, reliable rule.

Of course, many AR managers get asked to justify their AR spend by senior managers who have a limited understanding of AR and wants it measured in something they can understand: monetary value. Some of those firms AR teams are able to develop solid systems to estimate that value: others have to estimate. Fortunately this is not the case in most firms, but it is an interesting discussion all the same.

Lighthouse has spent a lot of time looking at different methods that vendors develop to value research, and we continue to discuss it. While a “quick and dirty” rule of thumb would be of interest for the wider AR community, no approach that values all reports the same can do anything other than mislead AR programmes into maximising the volumes of reports rather than the quality of rapport.