I suppose much of the problem with Online PR is goal setting.

PR goals:
- More talk about you along your messaging goals
- More offline references about you because of your online activities

How you demonstrate wether its working:

- Google trends:
Long term tracker for the news and search volume popularity of a phrase unique to you i.e. your brand name

- Google alerts:
Short term tracker, which shows specific mentions of a keyphrase on news sites, blogs, the web and groups.
Here you can get a microscopic view of what is being said about you. You can also get involved in the  'conversation' and directly interact when people speak of you.

- Volume of search references for your brand on search engines:
When you do a search on google, yahoo or MSN they all show you the number times your 'special keyword' has been indexed. It's not a superb indicator, but gives you a feel for your online popularity

Clear online PR deliverables you should have:

Hike in good web traffic to your web site:
If you are spending money on PR and you're in business, then you are chasing sales and profit. The general notion behind public relations is that 'its cheaper and more effective then advertising' - sometimes true.

Its all very good being talked about, but if you don't get relevant people on your 'touchpoints' (maybe your site)  then it's all a waste of money.

More Convnersions:

You get the traffic  - now its time to achieve specific actions from your user base ( conversions / phone calls / informaiton requests / sales leads )

How?
Online PR per-se will not give you more traffic. To get traffic, you need to implement some very specific mechanisms:

Search engines:
This is where Search engine optimisation and Online PR converge. The online PR gets the 'buzz' - the Search engine optimsiation gets the traffic.

By getting the right links in the the right sites and setting up your site correctly, you will get the right kind  of search traffic ready to buy or convert (Ive done a case study on this here )

Direct traffic:  
Websites
Get links on sites which have relevant interests and have users click through to your site ( easier said than done)

Paid for online marketing:
adsense, adwords, banners and so on - its a huge subject whicih I won't go into right now

Social Media Marketing
This includes having a myspace page, facebook page being on Digg, Netscape and so on. You get a presence across a

number of different sites and build up an aggragated volume of relevant traffic. This can be quite hard work, but

the benefit is that you are putting yourself right into the middle of communities who are relevant to you.

More Sales/conversions:
I have seen this countless times where companies spend large sums of money getting awareness or traffic, simply to fall down at the last hurdle when their site fails to convert.

Apart from the obvious:
- define your goal
- build to your goal
- ask for what you want when the user is ready

There is a whole universe relating to conversion optimisation, which I will talk about later.

To conclude:
You can get more from your online PR, but you need to link it in with the disciplines of search marketing and conversion optimisation.