Since the toilet was flushed on the economy in September, retailers are doing all they can to avoid bankruptcy. In January alone, retailers cut 45,100 jobs, according to the Associated Press. With a majority of retailers reporting net losses, cutting jobs is all they can do to preserve cash flow as consumers continue to clamp their wallets closed.
Even though public relations is becoming an increasing function of top management and a member of the dominant coalition, certainly some retailers and business owners think they just can't afford it right now. But the reasons to keep public relations within your budget by far outweighs the reasons to nix it.
Here's why it is to the retailer's benefit to maintain the PR aspect to their business plan:
Targeting Key Demographics: As times are changing, so may a retailer's target audience. A PR 
firm can conduct research to effectively segment and re-identify them as the economy causes this to evolve. For example, stores like Wal-Mart and TJ Maxx may be appealing to more affluent consumers who may have never shopped there before, but are considering it due to the effects of the economic crisis. Public relations can help these retailers better target these key consumers.
Crisis Communications: You could say that bad checks lay the foundation for bad publicity. Companies like CitiGroup and AIG have experienced some recent bad publicity due to the credit crunch. Crisis communications, or the process of decreasing the impact of a crisis, is a specialty in public relations that may be necessary when the press provides negative coverage of an organization.
Good Press: As retailers are losing more and more money, many are going out of business. This is the chance for smaller retailers to make a name for themselves. An important function of public relations is media relations. Thus, PR can help a retailer boost positive media coverage and gain consumer attention.
Overall, experts say companies that boost PR during an economic downturn fair much better than companies that cut it. In tough times public relations can help keep a company afloat. Retailers should keep this in mind when cutting public relations out of their business strategy. While they may save money for the short term, they may actually end up losing more money than they save in the end without it.
Do you think more businesses will recognize public relations as a necessity during this economic crisis? Tell us what you think.
Posted by Leah Southers on March 5, 2009 10:46 AM
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