Whoever said, "There's no such thing as bad publicity," clearly missed the financial industry's public relations nightmare of the last few years.
In an industry that trades on trust, public perception of its reputation is everything. And right now, the financial industry has a major trust deficit. In a recent NBC News/Wall Street Journal poll, 58% of respondents said they do not believe the stock market is fair and open due to "corporate corruption and broker practices."
While many firms that weathered the financial crisis of 2008 have seen their bottom lines recover gradually over the past three years, the damage to their brands and reputations remains largely unrepaired.
Public trust in the industry has bottomed out. That's making it harder to compete, as would-be investors are suspicious and existing clients cautious about becoming more heavily invested. Financial firms must get to work on repairing their brands and reputations and finding new ways to differentiate themselves from the competition. Strategic public relations is the optimal tool for doing just that.
Forward-thinking financial firms are increasingly turning to PR professionals for communications counsel, reliable media relationships and integrated marketing solutions that support the bottom line by improving public perceptions and regaining the trust of wary investors. But PR in and of itself is not a silver bullet. The best PR partners offer a complete arsenal of capabilities and demonstrated ability to meet financial firms' specialized needs.
Just as the financial industry landscape has changed over the last three years, so, too, has the communications environment. Unfortunately, too many financial firms seem content to rely on outdated PR models. Instead of proactively steering the conversation around their brand, they prefer to play the reactive game. At a minimum, these firms should try to steer clear of "old school" communications pitfalls.
Effective PR tells-and sells-the story. Experienced PR professionals have invested the time it takes to build relationships with members of the media for the express purpose of telling and selling their clients' stories. When it comes to media relations, your PR agency should constantly raise the bar, pursue bigger stories in higher-quality outlets, and deliver targeted exposure across multiple platforms-all with the objective of improving your bottom line.
Financial PR professionals stay abreast of industry trends, analyze the impact on their clients' ever-evolving stories, and respond accordingly with new strategies. There's just too much noise and clutter competing for attention in the marketplace to stand pat. Top-quality PR stays ahead of the curve, keeps control of the message, and delivers relevant content to key audiences.
Embrace Digital Outlets
In an era of instantaneous communications, firms must engage audiences in ongoing dialogues across multiple channels or risk being left out of the conversation. Digital PR helps firms keep that conversation going with key stakeholders in more creative ways than ever before. The flip side is that negative news and potentially harmful information does go viral at light speed. Even so, organizations that eschew online media and digital communications are likely to be hurt most because they will be the last to know and slow to respond.
Blogs, podcasts, online video and social networks have transformed the way information is disseminated. It can be problematic for financial firms, who need to be smart about how they try to influence and respond to word-of-mouth communications. They must be aggressive, but not heavy handed, while remaining mindful of disclosure and regulatory restrictions.
The bottom line is that a conversation about your firm is probably taking place, with or without your participation. You may as well take the opportunity to engage, share your perspective and correct misconceptions.
Get in Front of a Crisis
Despite all the scenarios that have the potential to damage a firm's reputation and threaten its business, too many continue to operate as if a crisis situation is something only the other guys have to worry about.
PR professionals know that the vast majority of crises can be anticipated and plans developed for responding immediately and tactically if something bad happens. A full-service PR firm can prepare you for dealing with a crisis, manage it when it occurs and help limit the shelf-life of negative media coverage.
Financial firms historically slash PR budgets during tough economic times. Nothing could be more shortsighted. Researchers at Penn State's Smeal College of Business found that firms taking a proactive approach to marketing and PR during a recession achieve superior business performance.
It's never been more important for financial firms to optimize their public relations efforts. When done well, public relations delivers a cost-effective way to enhance your credibility, build your brand and protect your firm's reputation. The best PR partners are creative, tenacious and have a solid understanding of old and new media. Most importantly, they are just as committed to your business and bottom line as you are. MME
This article is adapted from the white paper, "Optimizing Public Relations in the Financial Industry," produced by JCPR and Fuse Research Network. To download and read the full version of the white paper, go to jcprinc.com.