The announcement that insurance company AIG hired Burson-Marsteller for PR work brought out the critics, including the New York Post, which said the company was “wasting money on a high-priced public relations firm.” But AIG isn't the only one dealing with criticism of hiring a PR agency. Earlier this year, some members of the House Energy and Commerce Committee criticized the FDA for even considering hiring a firm, calling it a luxury.
The criticism shows there's still a misconception about how PR pros can help an institution communicate with numerous stakeholders. During a crisis, communications is a necessity, not a luxury. Yes, it can be difficult to measure the success of crisis communications work, but the alternative is leaving consumers and the media in the dark to speculate about the situation and company involved. Simply looking at the public understanding of the bailout shows how financial institutions and the government needed stronger communications outreach.
Companies like AIG need to communicate openly about their situation in a variety of forms, and an agency can help facilitate this, as well as ease the pressures on internal staffers. In a situation like AIG's, PR will help the company more than advertising, which acts more as a one-way conversation.
It tends to be cheaper, too. AIG, itself, pointed out that giving up ads and sponsorships more than offset the cost of hiring Burson, which can work with the insurer's audiences.
Though PR pros might not appreciate the attacks, their advertising cohorts might have fared worse if AIG had chosen the less effective of the two. As George Sard, CEO of Sard Verbinnen, said in an e-mail for AIG that was leaked to Bloomberg in October, “[spending] the taxpayer's money on an expensive ad campaign to apologize for how you used taxpayer money leaves you open to further attacks.” Communications, though, can explain as well as listen.