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How does Ad Value Equivalency (AVE) work?

AVE is a metric used to estimate the monetary value of earned media by comparing it to the cost of purchasing equivalent advertising space.

C
Written by CX Enablement
Updated over 4 months ago

What is Ad Value Equivalency (AVE)?

Ad Value Equivalency (AVE) is a metric that was used in public relations and advertising to estimate the value of media coverage in terms of advertising spend. It attempted to assign a monetary value to earned media by calculating how much it would cost to purchase equivalent advertising space or time.

The basic idea behind AVE was to compare the reach and impact of earned media, such as news articles or mentions, with the cost of advertising that would provide a similar level of exposure. For example, if a news article about a company appeared in a magazine, AVE would estimate the cost of purchasing an equivalent-sized advertisement in the same publication.

AVE calculations typically involved determining the advertising rates based on factors such as circulation, viewership, or time slots. The estimated advertising cost was then attributed to the media coverage earned, suggesting its equivalent value.

How It Works

For Web Content

The calculation is the following:
​price * pageImpression * ArticleViewProportion / 1000

price: in GBP

ArticleViewProportion

pageImpressions

contentLength

17.67 (contentLength ≤ 2000)

35.33 (contentLength ≤ 4000)

70.67 (contentLength ≤ 8000)

106.00 (contentLength > 8000)

1/16 (which is 6.25%)

Comes from Similarweb API as Readership, so Readership enrichment is a must to apply AVE on online articles

Number of characters without spaces

For Print Content

  • The calculation is the following:
    ​(price * Area * 100)

price: in GBP

Area

price: "Price color" in GBP in mm2
area: Article Area comes directly from the source in cm2
​
​

Area of the article in cm2 - coming directly from the source provider.

For Broadcast Content

  • TVEyes is a source for TV, Radio, and Podcast content that allows downstream applications to recognize keyword mentions in broadcasts. Because the search is based on keywords, TVEyes cannot determine the exact duration of each news piece without human intervention.

  • TVEyes calculates AVE in 30 seconds for US and Canadian markets but not for several other areas such as the UK.

  • Based on this, the technique for calculating the AVE for broadcast should be as follows:

    • Option 1) When TVE delivers the AVE in the feed, we should preserve the metric supplied by TVEyes exactly.

    • Option 2) When TVE does not supply the AVE in the feed, we should use the average CPT in that market as well as the TVEyes audience data linked with the channel and hour.

    • The average CPT should be investigated market by market.

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