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Communicating in a recession

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I returned last week from a meeting in Washington, D.C., where some of the world’s top communicators discussed best practices in recession-era communication. We reviewed several economic cycles and shared enduring strategies that are serving companies well as they communicate inside and outside.

Here are strategies that help companies retain the loyalty and confidence of their customers, employees and other stakeholders – and prepare for growth – during a recession:

1. Focus on core values. Those values should include:

• Insisting upon transparency. Keep channels open and actively communicate inside and outside your organization.

• Elevating customer service. Talk with your customers more often and more intimately; utilize the insight they provide to enhance services, innovate and stay relevant.

• Building new relationships. Reach out to build and improve relationships with potential new customers, those who will be more likely to purchase when their financial situation allows.

• Innovating and planning for future sales. Understand clients’ needs and review services; use any downtime to innovate and stay fresh. Companies that don’t develop new products or services during a recession must play catch-up during the recovery.

2. Lead and treat people well.

• Customers, employees and business partners want to know that you consider them important. Talk to people!

• People crave communication and leadership during a crisis. Those inside and outside your company are asking, “What does this mean for me?”

• Leadership from the CEO is essential, and transparent communication at moments like this builds trust and strengthens relationships and loyalty.

3. Increase marketing efforts. Rather than cutbacks as a way to endure an economic recession, several studies point to the wisdom of doing the opposite:

• Public relations ascends. American companies said they intend to continue investing in PR in 2009, according to a nationwide survey by the Council of Public Relations Firms. The survey predicts increased investments in social media and digital content creation.

• Aggressive marketing. For well-positioned companies experienced in successful marketing, a recession should prompt an aggressive increase in marketing spending to achieve superior business performance both in the short and long term, according to a February 2008 report from Penn State University’s Smeal College of Business.

• Win in a recession. In studying U.S. companies between 1982 and 1999, McKinsey found that successful leaders traded lower short-term profitability for long-term gain, and refocused rather than cut spending during the 1990-91 recession.

In short, recession can be a chance to press your advantages.

Ronald Hanser is president of Hanser & Associates, a West DesMoines-based public relations firm.