PR & the Pandemic: Time to overhaul communication strategies & business objectives?

e4m asked experts about ways to mitigate the crisis in the pandemic-afflicted industry

e4m by Nafisa Shaheen
Updated: Jul 7, 2020 9:34 AM
PR

What happens when there's an unprecedented and unfortunate turn of events for companies and individuals?  Sometimes, the first call is made to their PR agencies and then, maybe, to an attorney. But, what happens when these pragmatic problem-solvers themselves are faced by a crisis? Who is their immediate rescue? Here we look back at some of the crises faced by the PR industry and their remedies.

Business objective:

Every sector is bearing the brunt of the slow economy. Madan Bahal, Co-founder & Managing Director, Adfactors PR says, “The PR firms are but a microcosm of the business and societal universe. What affects the whole business ecosystem will also affect PR agencies. I assume the growth plans for the year FY21 would be impacted for most firms.”

Has it hampered the businesses objectives of the firms? Ameer Ismail, President, GolinOpinion, MullenLowe Lintas Group said, “As an agency, we remain undeterred in our objective of working with clients and brands to deliver the best and most impactful communication solutions for their business, even in these times. In fact, I believe in difficult situations, our relevance grows.”

PR firms' businesses are directly dependent on their clients'; so it's natural that PR firms may also feel the heat when their clients' businesses are impacted.

Archana Jain, Managing Director& CEO, PR Pundit said, “The world is facing the heat, the Indian economy is in recession, Indian businesses (our clients) are impacted, hence yes, our business is also under pressure. For many of us who were hoping for 2020 to be the best year ever, the last three months have been a period of temporary de-growth.”

While Udit Pathak, Founder Director, Media Mantra informed that expansion plans had to be scraped off and the focus was on attaining stability. He said, "This is not the time to be aspirational but to be able to sustain”.

Clients during the pandemic:

Some sectors like tourism, aviation, hospitality are hit harder than others. Naturally, budget rationing would be the immediate action. Sources have spoken about cutbacks in the promotional campaigns and staggered flow of money in the PR services. Top agencies have also experienced the erratic behaviour of clients amid the lockdown.

Jain reiterated that while the business was impacted after campaigns paused in April-June 2020, they have started witnessing renewed energy from clients, new projects and new clients from July.

Bahal too said that clients are exercising prudence and are mobilizing budgets where it is absolutely necessary.

Regional players too are facing the brunt. Mukesh Kharbanda, Managing Director, Fuzion PR Pvt Ltd added, “Fuzion operates in Tier 2 and 3 towns. There are roadblocks and pressures on cost right now, but the need to create impact and stay positioned in the desired manner is more than ever. Both are contradicting and the latter will soon supersede the former. “

Irrespective of this, firms remain committed to their clients to tide over these unprecedented times. Ismail and Pathak weigh in on the idea of showing full solidarity with their clients and work cohesively for businesses to sustain with a commitment from their clients of enhanced investments once the situation gets better.

Outstanding recoveries/ stalled payments:

Every business is impacted with demand, supply, production, distribution and cash flows disruption. The scale of impact varies based on the sector and market position of the client organisation. In this situation, delay in payments is not considered an issue. As liquidity has been impacted in Q1 of FY 2021 (April-June 2020), firms are expecting an extension of credit periods.  

Sources have also revealed that agencies are contemplating legal course on debt recoveries. It is unusual for PR firms to be in the news for suing their clients to recover payment as the industry thrives on relationships.

However, Bahal has a caveat, "As agencies, we must be thoughtful and empathise with the client's situation. No client who was making payments regularly for years will start delaying payments unnecessarily. Dialogue with the clients to find a middle path is superior to legal recourse.”

Chatter on New mandate wins > Client termination?

Agencies have been talking about new client wins for reinforcing positive sentiments and motivation; however, news of clients terminating relationships have also been sparsely reported. Does the industry shy from talking about client exits?

Bahal said both scenarios are true. According to him, “COVID-19 may actually be providing a tailwind to certain sectors like healthcare, and technology-driven businesses in general. On the other hand sectors like hospitality, travel, retail and others driven by discretionary spends are facing headwinds. On the one hand, a PR firm may be acquiring new clients while on the other hand, some clients may be taking temporary breaks.”

Pathak seconded the above statement by adding that all depends on internal communication from clients to agencies.

Jain too responded by adding, “It is a mixed bag. New business wins are real – we have also won some fabulous new clients in the last three months. But many clients have succumbed to COVID pressures especially in Hospitality, F&B and Retail segments.”

“I don’t think there is anything improper in announcing a new partnership, positive reinforcement is good in these times," said Ismail. " I see so many new business opportunities that are emanating from this situation and great creative thinking from our teams. I do not believe this profession or our industry will diminish. In my view, many things will change significantly but agency brands that are strong and committed in doing great work, will emerge stronger”, he added.

Kharbanda stressed on communicating the messaging that benefits agencies at this time. He advised, “Let us not see this divided into client and agency, it's one communication industry going through various challenges and changes.”

Is lack of resources costing efficiency?

The past three months have witnessed massive firings and sabbaticals across industries. Unemployment ratio has been at an all-time high during the pandemic induced lockdown. Has the PR industry too seen layoffs or sabbaticals? Has the lack of resources cost the efficiency of the client's mandate?

Adfactors PR boasts of zero attrition. Bahal informed, “At Adfactors PR we are working at enhanced capacity with zero attrition as a policy for the whole financial year FY21. We announced this publicly in early April to create a sense of comfort and security for our wonderful clients and folks who work at Adfactors PR.”

Golinopinion claims of sufficient resources to manage their clients. Ismail said, “We are backed by a much larger group ecosystem of talent to access where required, this ensures quality delivery. We have not asked anyone to leave or go on sabbatical.”

“While we are particularly grateful for our new wins in these testing times, our only focus currently is to ensure the health of our colleagues and their families, and continuous delivery on our client mandates,” added Amit Misra, CEO MSL India & South Asia.

Media Mantra too claims of not firing yet. Pathak informed, “We are aptly resourced and have not put any employees on sabbatical”.

These are extremely harsh times for industries across sectors. Staying optimistic and headstrong are the only ways to stay afloat during trying times.

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