What is “PESO” and what does it do?

PR Agency Germany - Industrie-Contact
What is “PESO” and what does it do?

PESO is short for Paid, Earned, Shared & Owned Media.

Over the last few years, the term has become more and more important in debates on optimizing the approach of target groups. Basically, PESO refers to the different media channels used by companies to get their ‚messages’ across to their target groups. Criteria such as scalabilityconsistency, credibility, or controllability are used to assess the value of a specific media channel.

The approach of target groups seems easiest in owned media, for example through articles on the company’s own website, the company’s blog or the company’s brochures. As the proprietor of these outlets, a company can publish without the influence of others. However, choosing to publish in self-owned media outlets entails certain risks, especially with digital media. Often, content is published very quickly, while the quality and consistency in terms of ‚messaging’ suffers.

The field of paid media, media outlets in which a company can place advertisements, used to be easy to understand. It consisted of print, radio and TV. With the emergence of digital media, the parameters have changed. Every medium, whether it is radio, TV or print, now also possesses an associated online presence. During the early years of the internet, this used to be a regular website. However, nowadays Facebook, Twitter, Instagram and many more have become relevant, causing great uncertainty regarding the use and importance of the different platforms available. Regardless of the lack of clarity just described, both Paid und owned media ensure high ‚message-consistency’, provided the company has done its homework.

Earned Media – The Domain Of PR

In earned media, as the name suggests, publications have to be earned, which is best achieved with news, good texts and photos, appealing video- and audio- materials, interesting events and good editorial contacts. The field has always been the domain of Public Relations. Companies like to use product innovations, surveys, client recommendations, media trips and fairs to generate interest via consumer or trade media. Being published in a key lifestyle or trade medium without having to pay financial remuneration likely means the PR-people did their job.

Shared media – some use the term social media synonymously – is the field where companies are most uncertain of their approach. With Facebook having about 1 billion users, one has to be present as well, right? In reality, it very much depends on the services and products the company has to offer. Consumer-brands a priori have a higher affinity to shared media than for example providers of capital goods. Even with all the hype surrounding these media platforms – ultimately, the most important question for a company remains: where and how do I reach my target groups best? The question is not, whether one has to start using certain media platforms used by others as well. The answer is yes, if the target groups relevant to the company can be approached via the platform, and no, if the spread is simply too big and the necessary expenditures are in no way proportionate to the benefits that come with the use of the medium.

Another aspect needs to be emphasized: earned and shared media are increasingly becoming paid media. As a result, the lines of distinction have become blurred; for example, some platforms are linking editorial contributions to the financial remunerations. Whether such policies are ethically justifiable remains open for discussion. However, the trend does exist and companies are well advised to take it into consideration during budget allocation.

PESO Establishes Order In The Chaotic Media Landscape

The media channels described above of course existed before the term PESO. However, using it enables us to categorize the new media landscape more clearly than before. The term helps consumers and agencies to distinguish between media channels based on a comprehensive model, and to assess their value according to criteria such as scalabilityconsistency, credibility, or controllability.

Having developed clarity on this front, companies can again focus on what matters most: clearly defining who they are targeting and which media channels give them the best opportunity, taking into account cost-benefit-ratios to reach their target group. No company has enough financial resources to do everything. In view of the myriad of existing channels and platforms, more than ever the main objective has to be to make the right decisions with the resources available.

Given the complexity of this task, preparation is the key. It makes sense for marketing and communication leadership to finally stop the conventional agency pigeonholing. The closer they cooperate with their advertising, PR and online agencies from the onset of a project, the better. In view of the complexity of PESO it does not make sense anymore to simply transfer the role of lead agency to the advertisers. However, that is a topic for another article …


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Author: Uwe Schmidt, CEO Industrie-Contact
Image Source: Spin Sucks by Gini Dietrich



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