What is advertising and public relations

Advertising vs. press and public relations - what to do when the red pencil rules

Companies in a wide variety of industries and of all sizes are currently facing major economic challenges. Due to the Corona crisis, trade, industry and the service sector are equally restricted and were or are in many cases at least temporarily severely restricted, if not completely paralyzed, in everyday business life. At the same time, costs continue to run for the most part, even if income is wholly or partially absent. In spite of government subsidies, this fact usually has noticeable consequences, even for companies with financial reserves.

Entrepreneurs who are not so hard hit by the circumstances that their economic existence is fundamentally threatened will still look for ways to keep the financial consequences as low as possible. This pressure to cut costs usually affects all departments of a company. New acquisitions are being postponed, contracts with external service providers are terminated or postponed as far as possible and, in many cases, personnel costs are reduced through short-time working.

Even those who are not forced to take such drastic steps will in most cases endeavor to avoid avoidable expenses and thus keep the economic burden under control. It is not uncommon for such a crisis strategy to hit corporate communications in one of its first steps. Expenditures for advertising and PR seem to be dispensable to quite a few company managers, especially those with a main focus on financial aspects.

The red pencil in the communication strategy appears comprehensible, easy to implement and effective when you consider how much companies are investing in this area. However, the question that every responsible person should ask himself, and which we want to deal with at least in broad terms, must be whether, to what extent and in which areas savings make sense or do more harm than good in the medium term.

"If you don't advertise, you die"

The quote attributed to the car maker Henry Ford seems to forbid any cuts in the advertising budget in a few words, even in times of crisis. If Ford also says "Those who stop advertising to save money can also stop their clock to save time“He wants to make it clear that savings in advertising will sooner or later fail and damage the company.

Comprehensible arguments that underpin this point of view are quickly found. To do this, it is important to keep in mind the main goals advertising pursues.

There are innumerable definitions that try to explain in just a few sentences what exactly is advertising and what distinguishes it from other disciplines in the marketing mix. Put very simply, advertising is a form of paid, targeted, target group-specific information transfer via selected channels or advertising media. It pursues different goals. First and foremost, products and services should be made known. In doing so, they are often presented in an emotionalized, exaggerated, positive light and do not necessarily focus on the truth, beyond legal requirements.

The main advantage of classic advertising is that it is completely under the control of the company. Within the scope of the financial possibilities, those responsible can distribute any content at any frequency and via any channels. Conversely, this control also enables an extensive backward movement at any time.

So if advertising is about making a company's offer positively known and creating a need and ultimately a specific need in a selected target group and if this succeeds to an extent that justifies the necessary investments, then it also explains why a Refraining from advertising hurts. Products and services in particular that are under high competitive pressure cannot rely on the target group to become aware of them on their own initiative. So if you do not advertise, you will ultimately not sell and thus worsen your situation in the medium term.

Saving on PR - a contradiction that is not a contradiction in terms

Press and public relations work is often promoted as an effective and, in particular, free alternative to advertising. It is assumed that, for example, an editorial contribution in an online or offline medium does not have to be paid for. Journalists are free to choose whether to report on a company, what it offers and what it does, because they want to attract readers and retain them in their medium. The functional principle of press work is therefore based on a simple win-win situation: the company provides first-hand information free of charge and thus reaches the target group without having to establish contacts itself. The good reputation and independence of the medium increase the value of press work compared to traditional advertising, which has increasingly lost weight in the appreciation of consumers in recent decades.

Anyone who has already actively dealt with the subject of press and public relations knows of course that it is not free. Even if you don't pay for a publication, which is unfortunately always the case in practice, due to the combination of editorial and advertising marketing, professional press work still generates relevant costs. Press releases have to be created, images and other content have to be prepared and made available, press conferences or press talks generate costs, contacts need to be maintained, which is only a small part of the tasks associated with press work. Permanent costs arise from the necessary human resources or from the commissioning of an external service provider. That means: press work that is done sensibly is far from being free. Nevertheless, the budgets for press work are generally much smaller than those for advertising. One reason for this is, not least, that press work offers significantly less planning security. No matter how much time, energy and money a company invests in a campaign, it can never be completely ruled out that there will be no measurable success in the form of the resulting publications.

The fact that press work costs money also means that, in case of doubt, companies can try to cut costs. The fact that results can only be predicted to a limited extent appears to be a good argument to justify savings in times of crisis.

Another argument why not doing press work appears to be bearable arises from its somewhat indirect effect. While advertising directly addresses the selected target group, press work tries to spread a message through multipliers. Target groups are not just potential customers, but stakeholders of all kinds. Communication strategies in press work are usually much more long-term. Since they are concerned with shaping a company image and thus exerting a long-term influence on the company's success, it is reasonable to assume that a waiver will not have any immediate effects. However, press work depends primarily on continuity. Success seldom occurs straight away. They are often preceded by a lengthy process. Contacts have to be made, networks built and relationships with the media and their representatives cultivated. Suspending here for cost reasons can prove to be serious and lead to what has already been achieved being given away in the end.

Conclusion - dead or forgotten

So what to do if your business mind recommends an austerity course? Based on the above findings about the potential consequences, the answer should probably be: the exact opposite. That means investing in advertising and in the press and public. In reality, however, this is not possible for most companies under challenging conditions. Nevertheless, it is the wrong decision to completely shut down corporate communications, both in the form of advertising and press work. The short-term savings that are possible here do not outweigh the medium-term and long-term consequences.

Nevertheless, those responsible would do well to develop strategies early on how they can act in such situations in order to reconcile what is reasonable with what is necessary.

Efficiency already counts when designing such a communication strategy. A precise target group definition and target group analysis guarantees lower wastage in communication and thus also reduces costs. This is especially true for advertising.

In press work, a strategy can to a certain extent be composed of a duty and a free choice. A reduced program includes all measures that are necessary to maintain existing contacts and basic communication. It enables spontaneous reactions to current events and tries to take advantage of the crisis. For example, the current situation and the company's actions derived from it can be communicated in a targeted manner.

In this case, online press work is particularly suitable. For example, media representatives can be reached in large numbers via press portals with little financial outlay.

Overall, with a significantly reduced budget adapted to the situation, it is possible to maintain communication and thus keep your own company alive on the one hand and remembered on the other.

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