The soft drinks manufacturers whose products were recalled from
supermarket shelves this week have acted quickly to protect their
reputation, and ultimately their sales. Their damage limitation exercise
has so far been successful.
The media have picked up the message being put across by the Government
and the British Soft Drinks Association that the drinks affected do not
pose a serious health risk, and after ordering immediate product
recalls, soft drink manufacturers now appear decisive.
Quite a different story to the BSE scare, when the Government
procrastinated for years before admitting that BSE in beef posed a
serious health risk.
The damage to the British beef industry was devastating. Not only did UK
sales plummet, but the scare resulted in a ban on exports imposed by the
European Union. The Government failed to release information on the
health risks posed by BSE in a controlled and consistent way, but even
the best planned media relations campaign could not have prevented a
crisis without immediate action to stop BSE spreading.
The handling of this week’s soft drinks scare indicates that companies
are now more alert to the need for consistent communications, as well as
actions, across an organisation. Issues which affect a company’s
customers also affect its share price, its reputation among staff and
the general public’s perception of its brand.
A survey by Countrywide Porter Novelli published this week confirms a
growing awareness among the companies which spend most on PR that
communications has a role to play right across their organisation.
Unsurprisingly, media relations was still seen by respondents as PR’s
main function, but among PR’s other key roles, they cited corporate and
brand reputation, cause-related marketing, culture change, crisis
management and handling environmental issues. PR budgets are already
expanding, at companies like Railtrack for example, to cover corporate
support for charities.
The majority of FTSE Top 1000 marketing and corporate affairs directors
interviewed by Countrywide expected their PR budgets to grow over the
next three years, some by over 50 per cent. Marketing and communications
directors expect their companies to spend more on PR because their
boards increasingly realise that issues affect consumer buying, and PR
can help to deal with issues before they become crises.
Companies are getting better at understanding communications. But
another clear message from the Countrywide survey is that if PR is to
embed itself further and play a role in determining marketing strategy,
it must recruit more people with commercial understanding.