Doom and Gloom, but Room for PR

Yesterday is being deemed as another "black monday" as stock markets crashed around the world. The FT's John Authers noted that "Even with the US on holiday, the sell-off was the worst single day for global equity markets since the terrorist attacks of September 11 2001."

So what does this mean for the Financial PR and corporate communications consultancies - Less business coming through the door? Job cuts? Smaller agencies disappearing all together?

Apparently not.

When all is doom and gloom around us, PR will be needed even more than usual according to Lord Chadlington, Group Chief Executive of Huntsworth.

In a letter to the FT defending the PR industry in times of recession, Lord Chadlington argues that:

"When the economy slides, transparency is increasingly demanded, making PR even more important than it is in good times. Consumer PR expenditure is underpinned as clients use it to compensate for reduced advertising spend; in financial PR, clients demand help to explain to shareholders weaker financial performance or staff cutbacks; and corporate PR tends to be used to boost the corporate brand to prevent bad news seeping into consumer behaviour.

While clients will always want to be sure that they really get value for their PR budget, based on my experience, very few would risk going into a downturn without the certain knowledge that they had tried and tested PR counsel at their elbow."

What is perhaps most interesting about Lord Chadlington's letter is his reference to the digital aspect of Financial PR, that "Monitoring blogs, building social networks and launching products on the internet are all the stuff of everyday life for today's PR practitioner and further boost income."

Online communciations will be a powerful tool over the coming year for companies wanting to explain weaker financial performances, both due to its low cost and ability to reach wide audiences.

I feel that many financial PR companies don't have a strong grasp on how to use this opportunity. As with all other PR sectors, those who embrace and innovate in online communications will be the ones who come out on top.