THINKPIECE: Recent history can teach us the dangers of cutting PRduring times of economic crisis

With a corporate earnings recession gathering steam, it's time to

ask a difficult question: are we repeating the same mistakes made during

the previous down-turn in the early '90s?



Those with long memories will recall how the public relations industry

was hit very hard by an exodus of middle managers, many of whom were

disenfranchised due to a lack of upward mobility that resulted from

spending cutbacks and squeeze on the bottom line.



The industry remains highly fragmented, gender and age inequity is

rampant, and the business model shows few signs of changing. However,

almost in spite of itself, a strong case could be made that PR should

not be cut. Here's why:



1. Increased media and audience specialization. Two words: the

Internet.



Access and the number of outlets where we get and receive information

have exploded since the last recession. This change has elevated the

value of portraying messages in traditional as opposed to

non-traditional media.



2. Complexity of managing perception. If perception is reality, then the

reverse also has grown to be true. The growth of spin has created an

environment where audiences are segmented almost to the point of

irrelevance.



The irony may be that the more people think they can control and

segment, the more they need PR to explain why they could not.



3. Where's the payoff? The following statement seems like a simple

enough conclusion: without external acceptance from those with

influence, the bottom line will fade. Yet this notion has always been

difficult to prove in a straight PR context. It shouldn't be when you

stop to think about it.



Consider Yahoo! as an example. As the company built a cult brand,

investors and news media were enamored with the company's portal model

and promise of "eyeballs," which were supposed to generate unlimited

revenue. News coverage was endlessly positive. When the portal model got

over-extended and sales dropped, coverage turned south. The company

recently named a new CEO and is just now beginning to portray a new

message in the marketplace.



To those who make key decisions, it bears repeating: watch how deep you

cut. Not learning from previous mistakes has a weird historical way of

catching up with all of us.



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