Iterative Marketing Podcast Episode 35: The PESO Model

The PESO Model stemmed from a revolution in the public relations community and is often underused by marketing departments. The acronym stands for Paid, Earned, Shared and Owned components. The model can be helpful when trying to organize and recognize promotional opportunities, which includes segmenting all of the marketing channels into discrete groups. It allows marketers to look at marketing efforts through four lenses to see if there are any opportunities to integrate additional channels into a new or existing program.

Episode Show Notes

Introduction to the PESO Model

(0:00 – 4:12) Introduction to the Iterative Marketing Podcast: Welcome to the Iterative Marketing Podcast, where, each week, hosts Steve Robinson and Elizabeth Earin provide marketers and entrepreneurs with actionable ideas, techniques, and examples to improve marketing results. 

In this episode, we discuss the PESO model, which encompasses Paid, Earned, Shared, and Owned media. Many marketers overlook this model and its potential benefits. We will explore the pros and cons of each aspect of the model and how they can be strategically used. 

The resources discussed on the show can be found at brilliantmetrics.com, which includes a blog and a LinkedIn group for community interaction.

Evolution of PESO in Public Relations and Marketing

(4:12 – 10:07) A Look Back at the PR Industry Pre-2008: The marketing world was predominantly divided into ‘houses’ of paid and earned media. Paid media involved monetary transactions for publicity. Earned media spread the brand message without any financial exchange. Publishers usually separated their operations, maintaining a clear boundary between ad sales (paid) and editorial (earned) to uphold integrity.

The Emergence of Owned Media: Owned media, where brands develop their own platforms and voices, gained significance with the advent of blogging. With blogging and branded blogs, every brand had the opportunity to become a publisher.

Influence of Technology and Social Media: The rise of blogging platforms allowed everyday people to become citizen journalists, adding a new dimension to the PR model. Social media platforms further complicated the industry’s dynamics, inciting debates about their management within the companies. The advent of social media gave consumers a significant voice, further influencing the PR model.

Identity Crisis and Emergence of the PESO Model: Changing dynamics, such as the introduction of social media, the shifting of journalists, and the blurred lines between paid and earned media, led to an identity crisis within the PR industry. PR professionals, faced with these changes, needed a new model to adapt to the evolving landscape. Gini Dietrich proposed the PESO model, which allowed PR to view marketing more holistically. This model helped the industry evolve beyond traditional marketing practices.

Understanding the PESO Model: Paid, Earned, Shared, and Owned Media

(10:07 – 14:25) Definition: The PESO model stands for Paid, Earned, Shared, and Owned – categories that represent different channels we can use to reach our target audiences. Using these categories, we can analyze our marketing efforts through varying perspectives, depending on our objectives, and understand the various avenues available to deliver our messages.

1. Paid Media: Paid media refers to any form of advertising where money is exchanged for disseminating the brand’s message. This could be through ads or content, with the main aim of reaching the target audience.
2. Earned Media: Earned media is the opposite of paid media. Here, the value of the content is traded to reach the audience of established authorities. These authorities, which already command an audience and credibility, distribute the brand’s content and provide mentions or carry their messaging.
3. Shared Media: Shared media involves the audience sharing the brand’s content. This audience comprises the brand’s own followers who could share content or ads created by the brand. Shared media can extend to the brand’s social media properties, where the brand shares content, hoping that it gets redistributed. It’s crucial to note that shared media involves everyday customers, not influencers or media outlets.
4. Owned Media: The last component, owned media, represents the platforms and audiences that the brand controls. Brands build up their own audience who seek out their content. These audiences might be subscribed to the brand’s newsletters or other means of accessing the brand’s content without needing to pay for distribution.

Examples and Case Study of the PESO Model

(14:25 – 20:07) Examples of Media in PESO

1. Paid Media: This could involve online ads, print ads, outdoor advertising, native advertising, or sponsored stories.
2. Earned Media: Traditional PR methods like press mentions, influencer relations, and investor relations are common examples. There’s often a crossover between earned and other forms of media.
3. Shared Media: This involves using the brand’s social accounts to encourage sharing of the brand’s content. Online reviews, sweepstakes, referral programs, and other efforts to encourage word of mouth are examples of shared media.
4. Owned Media: These are the channels that a brand owns and controls, like blogs, podcasts, print magazines, and brand-specific publications like Costco’s “Costco Connection”.

Case Study: Let’s consider a fictitious campaign, “Purple Hair for the Cure”, where people are encouraged to dye their hair purple to raise awareness and funds for a medical research charity.

1. Paid Media: Online ads like banner ads and video promotions could be used. Sponsored content through platforms like Outbrain or Taboola could also be leveraged to spread awareness about the campaign.
2. Earned Media: PR efforts to get the campaign covered by media outlets like the Ellen Show or local news channels and bloggers connected to the medical treatment can generate earned media.
3. Shared Media: Incorporating a call to action in the campaign, encouraging participants to share their purple hair transformation online, would generate shared media. The objective is to amplify the message among participants.
4. Owned Media: The campaign’s official website would be an example of owned media. It can feature information about the campaign, touching stories from participants, updates on fundraising goals, and options to subscribe for email updates or make donations.

This fictitious campaign illustrates that the PESO model isn’t airtight – many activities fall into more than one category, and influencers are a prime example of this. However, the true power of the PESO model emerges when all four channels are combined, creating a comprehensive, multi-touchpoint marketing program that’s hard to ignore.

Charity Outreach

(20:07 – 20:55) Charity Break: 4 Paws For Ability

Pros and Cons of the PESO Model

(20:55 – 23:33)  Paid Media Pros:

• Scalable: Paid media can be easily scaled to suit your budget. You can adjust your campaign based on the audience size, targeted geography, and frequency of ads. This allows you to design a marketing program that can effectively reach your audience while staying within budget.
• Reliable: With paid media, you have the guarantee that your ads will reach your audience. You can confidently put out your exact message, knowing that it will get the exposure it requires.
• Fast: Paid media, especially digital, can ensure that your ads are seen by your audience almost instantly. Even though print advertising might have a slightly longer lead time, you still control when your ads appear in the market.

Paid Media Cons:

• Lower Trust: Audiences tend to be skeptical of advertisements. They are aware that ads are paid placements, and this can lead to them not fully trusting the information presented in the ad.
• Expensive: As you aim to reach a larger audience, the cost of your campaign can significantly increase. Reaching a broad audience, especially on a national or global scale, can become costly.
• Ephemeral: The benefits of paid media can wear off quickly once you stop funding the campaign. While there might be some residual brand equity, the direct benefits of the advertisements cease almost immediately after the campaign ends. The ad placements go offline, click-throughs decrease, and print ads are eventually discarded, which stops the reach of your message.

(23:33 – 27:22)  Earned Media Pros:

• Authoritative: Earned media adds a layer of credibility and authority to your brand because the message is being disseminated by trusted third parties, not directly from your brand. This third-party endorsement carries weight with audiences, who generally trust external sources more than the brands themselves.
• Cost-Effective: Earned media allows you to leverage the established audience of media outlets. For example, if a reputable publication mentions your brand, you’re gaining access to their audience, which would have been expensive or near impossible to reach through paid means. Additionally, earned media doesn’t directly cost in terms of ad placements.
• Long-term Benefits: Unlike paid media, the effects of earned media don’t evaporate as soon as you stop investing in them. Press mentions, social shares, and blog posts about your brand can live online indefinitely, providing ongoing benefits such as SEO improvements and brand exposure.

Earned Media Cons:

• Unreliable: While earned media can be highly beneficial, it’s not guaranteed. You cannot always control when or how often your brand will be mentioned in the press or whether your pitch will be successful. It’s inherently more unpredictable than paid and owned media.
• Hard to Scale: Unlike paid media, earned media can’t be easily scaled. You can’t ensure more mentions or higher reach simply by investing more resources. There are a limited number of outlets and influencers that might be willing to share your message.
• Expensive in Resources: While earned media doesn’t typically require a monetary investment like paid media, it does require significant time and effort. Whether you’re handling PR in-house or hiring an external agency, the effort spent building relationships, creating pitches, and handling follow-up can be substantial. Despite this investment, there are no guarantees of success.

Thus, while earned media is not “free,” it’s important to recognize the substantial value it can bring. However, this value is largely dependent on the quality of your content and the relationships you or your PR professionals have with influential media personalities or outlets.

(27:22 – 29:20)  Shared Media Pros:

• High Trust Levels: Shared media, such as user-generated content and social media shares, carries a high level of trust. Recommendations from friends, family, or respected peers carry more weight with consumers than messages delivered directly from brands or media outlets. When content is shared by a trusted source, it is perceived as more credible and reliable.
• Low Cost: Shared media relies on the quality of your content, not the advertising dollars behind it. Creating compelling content that resonates with your audience and encourages them to share it can be a highly cost-effective way to expand your reach. While there is a cost associated with creating this content, the cost to distribute and promote it can be minimal if your audience actively shares and engages with it.

Shared Media Cons:

• Unreliable: Shared media can be unpredictable. You can’t guarantee that a piece of content will go viral or that it will even be shared at all. The success of shared media relies on many unpredictable factors, such as timing, audience mood, the nature of the content, and even luck. There’s no surefire formula to create a viral piece of content.
• Unscalable: Unlike paid media, shared media can’t be easily scaled up by simply creating more content or investing more resources. The reach of shared media is inherently limited by the size and engagement level of your audience and their networks. No matter how many pieces of content you create, they can only reach as far as your audience is willing to share them.

Overall, shared media can be a valuable part of your marketing strategy, especially for building trust and increasing brand awareness. However, it’s unpredictability and limited scalability mean it can’t be relied upon as the sole channel for your marketing efforts. It’s best used as part of a balanced, integrated approach that incorporates paid, owned, and earned media as well.

(29:20 – 31:24)  Owned Media Pros:

• Low Risk: Owned media is generally low risk because you have full control over the platforms and content. You don’t have to worry about sudden policy changes or algorithm tweaks that could impact your content’s visibility or reach. Your website, blog, email newsletters, and other owned channels are under your control and will remain operational and accessible as long as you maintain them.
• Long-term Asset: Your owned media assets, such as your website or blog, can deliver value over the long term. Evergreen content, in particular, can continue to draw traffic and generate leads for years after it was initially published. Additionally, as you nurture your audience and grow your list of subscribers or followers, these assets become more valuable and more effective.

Owned Media Cons:

• Slow Growth: Building an audience through owned media can be a slow process. It can take months, or even years, to grow your audience to a size that generates significant engagement and conversions. While the long-term benefits can be substantial, the short-term gains may be modest at best.
• Requires Support: Owned media can’t succeed in a vacuum. It needs support from other marketing channels and tactics to gain visibility and attract an audience. You’ll likely need to use paid, earned, and/or shared media tactics to promote your owned content and bring people to your owned platforms, especially in the early stages. This can require additional investment and coordination across different marketing channels.

Your owned media efforts should be integrated with your overall marketing strategy and should be viewed as a long-term investment. Over time, as you consistently produce valuable content and nurture your audience, your owned media assets can become a powerful tool for brand building, audience engagement, and lead generation.

Utilizing the PESO Model in Marketing

(31:24 – 33:44) Expanding Comfort Zones: As marketers, we should strive to move beyond our comfort zones. The PESO model (Paid, Earned, Shared, Owned) encourages us to explore unfamiliar territories. Combining different elements of the PESO model can create synergies and amplify our marketing efforts.

Embracing Opportunity and Structure: The PESO model provides an opportunity to diversify marketing efforts. It offers a structured framework that simplifies planning and execution. The model assists in categorizing, budgeting, and resource allocation, leading to more comprehensive marketing plans.

A Step-by-Step Approach: The PESO model promotes a broad approach but cautions against doing too much at once. Starting with familiar elements and gradually expanding into new areas can lead to more success. The key is to maintain forward movement and continuous expansion of marketing efforts.

Continuous Improvement in Marketing: The PESO model aligns with iterative marketing, advocating for continuous improvement and refinement. Regular evaluation and adjustment of strategies based on performance are recommended. This approach encourages a holistic view of marketing, encompassing all elements rather than focusing on a specific one, like digital or paid media. Continuous learning from successes and failures and optimizing efforts for better outcomes are integral parts of this approach.

Summary of Key Takeaways

(33:44 – 34:50) Change is ConstantL The marketing and PR landscape has dramatically shifted over the last two decades. Old strategies may no longer be effective in this dynamic environment.

The PESO Model: The PESO model offers a framework to organize and streamline marketing efforts. It enables marketers to view their organization through different lenses and find new promotional opportunities.

Components of the PESO Model: PESO stands for Paid, Earned, Shared, and Owned media, each with its unique strengths and weaknesses. Layering these components strategically can offset their limitations and create a comprehensive marketing strategy.

Adopting the PESO Model: Marketers should consider integrating the PESO model into their everyday marketing tasks. Despite the initial apprehension, exploring unfamiliar marketing channels could uncover new opportunities. The PESO model provides a structured approach to extending marketing efforts across multiple mediums effectively.

Join Us Next Time

(34:50 – 36:21)  Conclusion: In this episode, we discussed the significance of the PESO model in modern marketing. We explored each component of the PESO model—Paid, Earned, Shared, and Owned media—outlining their individual advantages and disadvantages. We highlighted the importance of not limiting marketing efforts to comfort zones and embracing new opportunities. The episode emphasized the need to layer these components strategically to create a robust and comprehensive marketing strategy. And finally, we concluded with the recommendation for marketers to adopt the PESO model, thus expanding their reach and enhancing the effectiveness of their marketing efforts.

In the next episode, we will delve into the art and science of content delivery. We’ll examine how to cater effectively to the See state audience—those who are potential customers but are not yet ready to make a purchase. We’ll discuss strategies for measuring engagement, improving content, and optimizing it to draw in this specific audience segment. Join us as we uncover the nuances of successful content optimization.

Have a great week and we’ll see you next time. This concludes this week’s episode. For notes and links to resources discussed on the show, sign up to the Brilliant Metrics newsletter.

Iterative Marketing is a part of the Brilliant Metrics organization. If you would like more information on the marketing services provided by the expert team at Brilliant Metrics, reach out today for a free discovery call.

The Iterative Marketing Podcast,  a production of Brilliant Metrics, ran from February 2016 to September 2017. Music by SeaStock Audio.

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