Navigating Economic Chaos: Why PR Is Crucial For Your Company's Survival

Natasha Gupta Mar 29, 2023

The world is standing at the cusp of an economic downturn, which may or may not result in a global recession. The hush-hush about what may be coming next has already got companies geared up for cost-cutting; the impact of which can be seen through downsizing and the reluctance to spend.

During an economic crisis, the first few functions that take a hit are all related to Support. Functions like Learning & Development, Public Relations, Human Resources, Marketing and Communications, and the likes are the first few to bear the brunt of organisations’ strategies to stay profitable and maintain their footing in the market.

A recession or the possibility of it changes both consumer and brand behavior. Consumers are insecure about spending on what they consider luxuries. Brands on the other hand cut back on costs; and in the process, they might let go of what keeps their brand afloat.

Let us run a fine-toothed comb over these functions; specifically, PR. Different organisations view PR and brand building as good-to-have. They might jump ship at the first warning sign – and in the longer run lose on their brand visibility and marketing. In Steve Jobs’ words, “a lot of times, people don’t know what they want until you show it to them.” By refocusing PR budgets and initiatives, brands often break the link between the consumer and the product/service. Without product visibility, consumers are more likely to replace their preferred brands and switch to competition that is out there and prominent.

A decline in economic activity can also leave companies confused between advertising and PR; which is understandable. Advertising and PR are both marketing strategies; however, follow completely different approaches. Industry experts assert that the former is a big-bang approach to draw consumer attention toward the brand; while the latter is like an undercurrent that converts consumers to loyalists.

Marketing and PR become even more important during an economic crisis. The goal during these times is not to sell the product once. The goal is to remind the consumers why they still need the product/service – the goal is to create and sustain recurring demand. There is no better way to do it than to communicate through the right channels; to earn and maintain trust, and to do it multidimensionally through myriad sources of media.

In uncertain times like these, it is imperative for companies to plan ahead and go aggressive in marketing and PR in order to combat competition, deepen their market hold, and stay on top of the mind when consumers are in doubt. It takes enormous time and effort for companies to build credibility – and it is a slow process. By definition, processes need to be continuous in order to be valuable. In times like these, brands need to shift almost all their emphasis to innovation and marketing. Innovation keeps them sharp and in the game; while marketing communicates about the game to the right set of the target audience. PR also helps companies to build strong relationships with stakeholders, investors, and consumers alike.

The very pertinent question that companies grapple with is the allocation of budget for advertising and PR. While there is no comparison in terms of the value the two marketing approaches bring to the table, PR is essentially a more cost-effective way to build brand value and maintain market reputation.

Heck, it can even get companies out of a sticky situation by managing negative publicity and other crises.

Experts agree that it is much easier for companies to navigate through unprecedented times with the collective wisdom of multiple people who are good at what they do. Business goals are not met through people working in silos, and hence there does not have to be a choice between this or that. A good strategy to achieve business goals is to look at the long-term value, be cognizant of the consumers’ mindset, and stay on top of the marketing game. It is not an added expense on the company’s balance sheet. It is a good investment that comes back manifold.