PR and Corporate Image

8/8/2019 PR and Corporate Image

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PR and Corporate Image


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Basic Principal of Corporate PR

y Corporate public relations seeks to project the imageand identity of the organisation.

y Based the facts and figures as well as on the

subjective impressions and feelings, image itself is aduct of public mind.y In order to project the identity of the organisation,

the PR needs to know both - facts that people know as well as the impressions that they carry about theorganisation.

y Therefore Corporate PR manages the reputation of the organisation.


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Few essential guidelines of corporate PR

1) Corporate public relations is a shared responsibility and therefore must be truthful and believable.

2) As a 'caring entity' and a 'good citizen', PR believes thatcorporate public relations programme is an investmentin the Image building of the organisation.

3) PR is never open and responsive to public concern.

4) PR recognise that one's own view is subjective andnever influences the organisation to take corporateconvictions for reality.


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5) In terms of corporate communication PR thinks of sharing with the community the values which it upholds and for which it wants to be known.

6) Corporate Communication is a faith and a commitment which cannot be compromised under any circumstances.

7) Corporate PR always believes in the institution of a longrange image and identity and therefore never subscribes toany crash communication plan.

8) F inally PR maintains excellent communication relationships both at the corporate and at the unit levels with the internalas well as the external publics.


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CORPORA TE IMAGE:

y According to Philip Kotler, "Image is the set of beliefs, ideas and impression, a person holdsregarding an object.

y This is also applicable to business." Corporate Imageis the set of beliefs ideas and impression, a personi.e. 'customer, shareholder and employee holdsregarding and object i.e. the company.


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y There are different Images which people may haveformed about a particular Company.

These may be a good company or Consumerfriendly company" etc. The attitude and actions of the people will be as per the Company's Image intheir minds.Such Images may be favourable or unfavourable.Favourable Image gives positive response whereasunfavourable Image gives negative response.


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Factor affecting Corporate Image or Elements of Corporate Image Building.

1) Quality and Pricing of the products.2) Attractiveness and safety of the product.3) Dealer relationship and the attitude of dealers

towards the company.4) Discounts, credit facilities and after sales services

offered.5) Sales policies and sales promotion techniques used.

6) Advertising and Ad Campaigns of the company andthe logo used.7) Press relations of the company including Press

Publicity.


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8) Discharging of Social responsibilities.9) Consumer service, Consumer protection and

Welfare.10) Product line, Product Modification and

Introduction of new products through R & Dactivities.

11) Contribution of the company in regards todevelopment of sports, rural development andecology balance.

12) Social audit programme of the company.


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13) Attitude towards female and handicappedemployees.

14) F inancial position of the company management

practice and Socio-economic objective of thecompany.


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Positive Image building is needed for thefollowing purpose

1) To promote sales and thereby earn more profit.

2) To introduce business growth through expansion anddiversification.

3) To develop brand loyalty among consumers.

4) To effectively face adverse business environment.

5) To Secure Co-operation from different social groups for business growth and prosperity.


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6) To Secure Support from Investors for raisingcapital for business growth.

7) To Secure Public support and sympathy when thecompany is facing serious difficulties regardingproduction and Marketing activities or whencompany is facing serious financial crisis.


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Benefits of Positive/Good/ Favourable Image

1) Recognition as Consumer-friendly enterprise.

2) Social Support and Co-operation.

3) Social recognition.

4) Prestigious Position.

5) Increase in Sales and Profit.

6) Image building has publicity and promotional

value


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. Important Measures for Positive Image Building

1) For Positive Image Building, due attention should be given to consumer protection, satisfaction and welfare is MUST.

2) Fair treatment should be given to all social groupsand be made an integral part of the philosophy of the company.

3) Introduce pollution control measures.4) Support Sports, Education and Cultural activities.5) Attention should be given to female and

handicapped manpower.


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6) Maintain high level of efficiency and productivity.

7) F inancial support should be given at the time of natural calamities.

8) Maintain Ethical Climate in the organisation andopeness in the policies and operations of thecompany.


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CORPORA TE IDENTITY

y An organisation transmits messages to the publicson a sustained basis. It is the reception of themessage which goes to create the intended image.

Corporate communication is the process thattranslates an identity into an image.y In brief corporate image refers to the image that a

company has acquired with the public whereas

corporate identity refers to the image a company strives to achieve, in order to build a reputation withits publics.


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y In this context every company needs a mission. Thismission should be the framework for business and allits activities. The mission is the glue that holds the

company together.y Here, the PR and its communication strategies come

into focus. If the objectives and mission of theorganisation have to be accomplished, the corporate

body must communicate short-term goals, longrange objectives and even the total mission of theorganisation.


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y Inadequate communications results in an ambiguouscorporate image. It may lead to a breakdown in co-ordination and elements in an organisation.


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PR ROLE IN IMAGE AND IDENTITY

1) Name of the organisation - divisions and subsidiaries.2) The logo factor - symbols in use.3) Advertising and promotion.

4) Company publications - including annual reports andhouse journals.5) Company assets - well maintained office production

units, cars and outlets.6) Company packaging -labels and tags.7) Company signs - at public places offices and production

units.8) Company stationery - forms, letterheads, cards etc.


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THE PR ROLE IN ACCIDENTS AND TRAGEDIES

y Serious tragedies such as the Bhopal Gas tragedy have occurred as a result of managements failure toadhere to the norms of safety.

y When crisis strikes, PR in its proactive role shouldtry to carry conviction with the management thatsafety and welfare of the employees and community is the responsibility of the management.


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THE LOGO

y Logo means a single piece of type comprising a wordor words or a name, address, trademark or design".

y Companies use their logo in their advertisement for

easy identification.y There are many logos which we observe in our daily

life.y Larsen and Toubro company has a simple logo in the

form of LT.


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LOGO AND CONSUMER

y Whether it is in print or' on electronic media, eachpassing ad or message fight hard for a share in theconsumer's mind and instant attention.

y A powerful logo will definitely have a greater impact. When it comes to catching the consumer's eye, theinterlinking of logos and brands is something every marketer strives for.


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F inancial PR

y Communicating with the financial public is known asfinancial public relations.

y These are special public who are quite sizeable in

number and form dominant groups in the domain of financial public relations.

y They matter more to the organisation although noPR and management can ignore any public.

y It is essential for the existence of the organisationitself to have effective communication with all of them.


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Who are financial public

1) The registered shareholders.2) The investing community including potential

shareholders.3) The direct financial community consisting of banks and

financial institutions, stock brokers and a variety of key players individual or institution in the global money market.

4) The audience in the market scenario comprising of politicians, customers, employees and the general

public on specific occasion.5) The financial and economic press in particular whichincludes number of newspapers, trade journals andother publications who create interest in economicsand finance.


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4) In the ever growing and fast changing financialservices. PR has to adopt the management of change in -the context of the challenges and

opportunities and different PR tools and methods.

4) In the professional interest of PR and also in, theinterest of business as a whole, PR must be well

versed with business finance. Due to financialilliteracy many PR persons has been ruined.


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y Any PR person involved in financial communicationshould possess complete knowledge of theaccountancy concept and language. Some of the

important terms are:

1) F inancial statement and its structure.2) Return on capital employed and return on

shareholders capital.3) Gross profit and net profit.


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PU BLIC RELATION - F INANCE INTER F ACE

y PR and finance have a lot in common and each one can learnquite a few lessons from eacr other. The following are a few examples of mutual co-operation and learning at both thelevels.

1) The finance department has to know and understand aboutPR as an essential input of the organisation.

a) In the first instance PR expenditure is not a cost but aninvestment and it should be given priority. PR is indeed not

something free.

b) Even during financial crisis cutting PR costs is not efficientand practical cost management. It is like withdrawal of essential inputs towards development of the organisation.


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2. PR people have to learn atleast the basic rules of finance and managerial control systems if they have to be seen as responsible professionals.

3. It is necessary to draw up a budget in consultation with the finance department though it may not costa fortune.

y In short finance and PR should have the same goals

and same purpose


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y The following are the PR tools in financialcommunication:

1) The Press.

2) Media Relations.3) Press Release.4) Press Conference.

5) Annual Report and6) Annual General Meeting.


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y The press play a very important role as a means of communication by the companies to variouscategories of investors and financial public.

y The press activity helps the shareholders andpotential investors to maintain a record andunderstand the performance of the company on thefinancial front.

y The press includes local, regional and nationalpublications as well as financial and economic press.

y In addition to this there are a number of trade journals, marketing publications and evenpublications of general interest.


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How to tackle press

1) No PR should ever run short of time as far as pressrelations is concerned.

2) It is the duty of the PR to ensure that spokespersonfrom the company even at the highest level isapproachable and accessible.

3) The company spokesperson should have thoroughknowledge of finance, technical and other economicaspects. There cannot be a compromise in this.

4) Provide the right kind of information to the journalist whether financial or general. This will enable them tofulfill their assigned roles which is a key part of any communication programme.


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MEDIA RESEARCH

y An essential requirement for the success of any business enterprise is an effective media relationsprogramme.

y PR has to make a judicious selection of journalsnewspapers and electronic media. Billboards andhoardings also form a part of it for gaining thesupport of the investors and also for boosting the

image of the company.


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Things to be kept in mind while selecting media

y Reach: How far does the projected mediainformation provide a picture of the real situation?

y Att en tio n: Innovative steps through electronic

media are restricted but they are instant. But in pressthe possibilities are endless. Hence both must co-exist, each with its own advantage.

y Dur ab ility : T.V. might carry a lasting impression

on the mind but press advertisement have a betterlongevity.


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y A ud ience: Electronic media has the attraction of bringing newer breed of people to in fold whereaspress can attract serious readers on a sustained

basis.y I nf o rm a tio n: T.V. can flash the bare essentials

which are just not enough whereas press can easily pack in much more detailed information which the

financial readers constantly need


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PRESS CON FERENCE

y A traditional method of giving information by directuse of face-to-face communication technique arepress conferences.

y Such methods have been found to be distinctly useful when an important event or development is to beannounced or when the annual accounts and reportsare to be published.


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y A few points are to be considered while organising pressconferences specially for financial public relations.

1) Adequate advance preparation and presence of thehighest management group is the essence of success fora well organised press conference, Since such pressmeetings will evoke intelligent questions and theremust not be any scope for faltering reply.

2) The very purpose of a press conference is aimed atprojecting the corporate entity and its financialobjectives to key the target audiences. Thereforepreparing the corporate image for launching a financialcampaign is a direct PR task.


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3) In many cases in order to avoid controversies a lot of temporaries prefer to throw the conference venue opento as many media persons as possible.

4) It is very important that the press conference beaddressed by the senior most executive of the company No media person would like to spend their valuabletime with someone who is not a legitimate newsmaker.

5) The comparative merits and limitations of a pressconference must be carefully assessed or otherwise becontent with mailing a financial press release which canalso be newsworthy.


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ANNUAL REPORT

y In order to introduce the company to the financialpublic as well as to financial collaborators an annualreport is the most essential and first-hand

communication.y It is mandatory on the part of the management to

present audited accounts of the company before theshareholders at the annual general meeting.


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y Annual report is an essential input of financial publicrelations. The PR role in the preparation andproduction of the annual report could be as follows:

1) The company secretary together with the finance wing of the company prepares the draft annualreport.

2) PR plays a constructive role by emphasizing theneed to be free and frank, to admit difficulties andexplain the steps to overcome them.

3) The annual report can be used effectively as a toolof PR communication.


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4) One way to win over mass attention is to publishthe chairman's statement in selected journals andnewspapers. It should be published mainly in those

which specializes in financial matters.5) A complete circulation list for annual report

dispatch is to be prepared by PR department. Thisa golden opportunity to be in contact with the

financial press and concerned financial public.


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ANNUAL GENERAL MEETING

y AGM is an important PR occasion when importantfinancial statements including audited accounts areput up before the shareholders. The chief executive

gives details of the company's performance duringthe last one year and explains the company's plansand strategies for future development.

y Though PR is not directly involved still he can

perform well from the background


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y In relation to AGM the tasks of PR with adequatemanagement support are as under

1) As far as financial public relations is concerned PR activity must not be restricted to media relations alone. F inancialPR covers much more than just dealing with a few financial journalists.

2) PR can demonstrate its effective role in many other financerelated activities including AGM.

3) The PR can project the organisation to the outside world asa dynamic entity alive towards the welfare of the community at large by making the chairman's speech reach a much wideaudience.

4) Presentations is another effective way of attractingshareholders attraction to the company's achievements.


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5) In order to make his role noticeable in AGMmatters, the PR must have good access to the Chief Executive and senior management persons. He has

to develop keen business acumen and be a part of the business group which handles investorsrelations programmes.

6) A well-planned PR programme will cover media

relations, Press - TV - Radio interviews, newsreleases, press conferences and follow-up or postmeeting exercises.


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y A share is an instrument representing the true worthof the company.

y The value of share gets affected by the market forces

of demand and supply as well as by the goodwillenjoyed by the company.y The judgement of the public in respect of a company

will depend on the flow of accurate information

about the developments and financial performanceof the company.


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y It has been seen that those companies who are inconstant touch with the shareholders and maintaingood . relations are in a much better shape both in

good as well as bad times.y Hence communication with the shareholders needs

to be an on growing process in order to gain theireverlasting loyalty and credibility.

y In addition to this the shareholders will beinfluenced by the financial reports and comments of the press, T.V. and radio.


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y The PR professionals can play an active role increating investors awareness.

y Today management believe that relations with the

entire capital market should be handled in aprofessional way and on a continuing basis.y This calls for special skills and aptitude. Here comes

the important role of PR in financial relations for any

business organisation.


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ELECTRONIC MEDIA

y Whenever there are chances to appear on televisionor in radio talks, the opportunity should be used tothe best of the advantage.

y

The PR and the top management have to be wellprepared though the occasion may be a general onelike take-over bid, or a success story.

y They have to make an impressive and realistic

projection about the company's actual worth into the world of finance.


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F INANCIAL ADVERTISING

y Today financial advertising is a specialist field more than just Jargons involved in selling products like shares anddebentures.

y In the by gone days only brokers and institutional buyers

were the target groups but as on date there are millionsof individuals making personal investment decisions withlittle or no influence of the brokers.

y The Indian middle class having a little more fund hasfound a way to play its additional money and time in the burgeoning money market.

y India is now having one of the world's largest stock markets with a roster of more than 10 millionstockholders.


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y A conservative investor would normally prefer a debtinstrument like a bond or a debenture with assuredreturns but a young speculative investor would be

ready to take risk and would gladly hazard his money on a dazzling issue.


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y The roleof PR in overall financial communication will be contingent upon its own capabilities and alsoon the management appreciation of its functional

efficiency.y Advertising and PR objectives are more finely cut.y A drastically over-subscribed issue could burden the

company with high cost in refunding the extra

money, and at the same time an entirely new targetaudiences have to be chalked out for each issue.


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SEBI GUIDELINES

y The Securities Exchange Board of India (SE BI) has putdown certain restrictions on the issue ads for shares anddebentures and mutual funds.

y The advertising people term it as a sudden attack on

"creative" element of advertising.y No models, no fluff, no wacky visuals, no smart headlines

or no unsubstantiated claims.y In the interest of the investor protection, SE BI feels that

financial advertising, video display etc. must notinfluence the investor.

y At the same time it is true that no one is being stoppedfrom separate corporate image campaigns.


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y SEBI has separated the issue ads and the corporateads. This has brought bifocal advertising into centerpoint of financial advertising.

y

Hence, one campaigns paints the larger image of thecompany and another provides well manipulatedhard-core financial data.

y As a result of this many companies prefer to award

corporate accounts to mainline advertising agenciesand the issue accounts to specialist financialagencies.


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PR FUNCTION IN F INANCIAL ADVERTISING

1) PR function and PR persons must adhere to decentand truthful norms while handling pre-issuecorporate campaigns.

2) Use of corporate or brand personalities in issueadvertising is unacceptable to SE B! . In the Indiancontext PR has to be fully conversant with theguidelines issued by Advertising Standards Councilof India.

3) PR has to review results against financialadvertising goals on a regular basis and initiatecorrective actions next time.


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7) Careful evaluation of the available facts would go along way in arriving at a right decision.

8) Investors are not all experts in money management. People buy financial products whenthey feel confident and find the offer trustworthy.PR can play its role as an influencing factor in

investment decisions. So in financial advertising hehas to produce the .right advertisement campaignat the right time for the right segment at the rightcost rather than at the lowest possible cost.


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SPECIAL SITUATIONS

y A few special events require specific attention andappropriate involvement of PR persons in defining PR objectives in relation to financial public relations. Someof the key issues of the campaign are

1) A cq u isitio n s : It may be agreed or disputed, friendly or unfriendly, PR has to define and play its role. _

2 ) F lot a tio n: It is a means by which a company comesinto share market. PR will initiate public relationsaspects of launching, implementing corporate andfinancial public relations programme, monitoring shareprice movements and organising new shareholderprofile.


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y P r iv a tis a tio n: Through the flotation of shares onthe stock market transfer of public-sector owned business to private sector.

y

Sp o n so r s h ip : Community responsibility throughsupport for arts, sports, environment and humaninterest areas.


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CORPORATE PR

y While planning for corporate goals and strategies inspecial situations PR must give adequate importanceand attention to

1) Customer relations.2) Employee relations.3) (Community relations.4) Government relations.5) Investors relations and6) F inancial public relations


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Documents

PR and Corporate Image