The critical role of effective PR in navigating both crisis and growth cannot be overstated for financial institutions.
When banks or financial institutions face difficulties, the repercussions are severe, often resulting in plummeting stock prices, collapsing companies, job losses, and a significant erosion of public trust in institutions meant to safeguard their interests.
Conversely, when these companies thrive, access to finance improves, people are empowered, and opportunities expand. Financial institutions are essential to individuals, industries, governments, and economies, underscoring the profound impact their performance can have on broader societal and economic well-being.
Given this importance, it’s not surprising that the media and public are often unforgiving when mistakes occur.
The lingering effects of the financial crisis of 2008, which saw the value of imports from the European Union, Japan, and the United States plummet by almost 40%, triggered a worldwide collapse in international trade and led to a 2% contraction in the global economy, remain a vivid memory for many. This underscores the intense pressure faced by financial public relations, more so than in other PR sectors.
During the COVID-19 pandemic, the demand for financial services surged, highlighting why many institutions keep a PR agency on retainer. The use of digital payments skyrocketed as cash was deemed unsanitary, with two-thirds of adults globally now engaging in digital transactions. Further emphasising why financial institutions should have a PR agency on retainer.
What is financial PR?
Financial PR focuses on managing how financial companies communicate with their audiences. Money is a powerful subject, influencing everyone’s lives as we all need and desire it. Financial PR is similar to PR in other sectors, involving the strategic distribution of information to highlight a company’s strengths and maintain a strong reputation.
It involves sharing factual information, figures, and news about a financial company and its positive impact on stakeholders. The goal is to generate positive reactions from customers, investors, and the public. However, it also requires navigating the legal and regulatory frameworks that are often part of the financial industry.
Why is financial public relations important?
Financial PR plays a crucial role in helping financial businesses achieve their objectives. In the finance sector, credibility is vital. The aim of PR is to enhance a brand’s reputation and build trust, boosting audience perceptions and investor confidence by effectively communicating a firm’s integrity, expertise, and commitment to customers.
Here are some key reasons why financial PR is important:
- Building Trust
Trust is essential in finance. Companies must be perceived as reliable and competent. Without it, their operations could be jeopardized. For example, the collapse of MF Global in 2011 stemmed from a loss of trust due to financial mismanagement and misuse of customer funds. This trust deficit led to a liquidity crisis and the firm’s downfall, underscoring the critical nature of credibility.
- Making Announcements
PR is vital when a company goes public, expands into new markets, or launches new products. A well-crafted media strategy ensures your story reaches the right audience at the right time. Additionally, PR can highlight financial achievements and future plans, reassuring existing investors and attracting new ones.
- Crisis Management
Financial PR is crucial during crises, such as data breaches or negative events. A proactive PR strategy prepares for potential issues, ensuring that responses are timely and effective. Planning for worst-case scenarios, while seemingly unnecessary, can prevent or mitigate damage if crises arise.
- Highlighting Unique Selling Points
In a competitive market, effective PR can emphasise what sets your financial products apart. Whether it’s time-saving features, lower costs, or superior functionality, PR helps communicate these advantages and attract investor interest.
- Targeted Messaging
Tailored messaging ensures that your communication addresses the specific needs of different audiences. For instance, messaging for risk-averse investors should focus on stability and safety, while communications for more aggressive investors might highlight potential high returns and market-beating opportunities. This approach effectively showcases your unique selling points to the appropriate audience.
What are the specificities of financial PR?
Financial PR is distinct from other industries due to its direct impact on investor confidence and market behavior. Here are key aspects that set it apart:
- Regulatory Concerns
Financial PR operates under strict regulations that are more stringent than in other sectors. Compliance is crucial to avoid misleading information, accusations of fraud, and potential lawsuits. PR professionals must be knowledgeable about these regulations and often collaborate with legal experts to ensure adherence.
- Disseminating Complex Information
Financial PR involves communicating complex and technical information in an accessible way. It requires translating intricate financial concepts into clear, jargon-free messages that can be understood by customers, investors, and regulatory bodies. Ensuring clarity without losing the message’s meaning is vital for effective communication.
- Media Scrutiny
The finance sector faces intense media scrutiny, especially during financial uncertainties. Transparency is essential to manage public perception and maintain trust. Exaggerated claims can attract negative attention, so building strong media relationships and providing honest, straightforward communication is critical.
- Market Impact
Financial PR communications can significantly affect market behavior. Announcements about earnings or mergers can lead to stock price volatility, so timing and planning are
crucial to manage market reactions and avoid disruptions.
Why Hire Third Hemisphere as your Specialized Financial PR Agency?
If you recognise the value of financial services PR but aren’t sure where to start, Third Hemisphere is your ideal partner. Our agency combines deep industry expertise with a proven track record of delivering impactful results for financial institutions.
A prime example of effective financial PR is Third Hemisphere’s work with Limepay. The agency implemented a series of media campaigns to introduce Limepay’s unique Buy Now, Pay Later (BNPL) solution. By offering an exclusive story to prominent technology journalist Yolanda Redrup at the AFR, Third Hemisphere highlighted Limepay’s transformative impact on the retail industry.
Following this exclusive, the media release was mass-distributed across relevant trade press. This approach resulted in 192 pieces of coverage with an estimated 1.74 billion in online readership, significantly increasing Limepay’s web traffic and customer inquiries. The coverage established Limepay as a leading competitor and potential disruptor in the BNPL sector.
Navigating the complexities of financial PR requires a partner with not only in-depth industry knowledge but also a strong history of success. At Third Hemisphere, we offer expertise tailored to the dynamic finance sector, ensuring our strategies meet stringent regulations and align with your business objectives. We seamlessly integrate with your team, crafting campaigns that resonate with financial communities and regulatory bodies, and setting the stage for measurable success.
In the realm of financial media relations, earned media often proves more credible and impactful than paid advertising. Investing in a robust PR strategy could be one of the most rewarding decisions you make this year.
Let Third Hemisphere empower your company with our extensive knowledge and experience to stand out in a competitive financial landscape. Whether it’s rebranding, launching a new product, or preparing for crisis management, discover how we can elevate your business’s public profile.
