Is Negative PR Bad for Business?

By Sarah Bonewits-Feldner and Tom Isaacson

For practitioners working in corporate communication and public relations, an ongoing concern is the impact of negative publicity on relevant target audiences. The old adage “there’s no such thing as bad publicity” – frequently cited by business journalists and alternately credited to either P. T. Barnum or an ambiguous “they” – deserves a closer look.

Unequal, a sport-equipment manufacturer, recently decided to use the controversial Michael Vick to promote its products. In a story described in the Wall Street Journal, company executives and consultants debated if the move would help the relatively unknown company or if it would be ‘business suicide.’ Apparently, it was the former.

According to the article’s author, Lee Hawkins, after the endorsement deal was announced the high number of hits on Unequal’s website crashed the site and sales initially went up 1,000 percent before settling “at about triple what they were a year ago.”

However, we know a single example rarely settles an argument. For every organization that benefits from negative publicity, counter examples exist as well.

A recent Economist article, citing academic research published in Marketing Science, helps to establish some of the characteristics of organizations that benefit from bad publicity. One of the authors of the research, Alan Sorensen, is cited in the article discussing how almost any publicity for relatively unknown individuals or brands is beneficial while an established individual/brand may be hurt by it. According to the article, the logic (supported by econometric analysis and experimental research) is as follows:

“One reason is that, for lesser-known brands, negative perceptions fade more quickly in consumers’ minds than their general awareness of the product. When coming across a brand whose boss is, say, a philanderer, they recognize it but don’t remember why. With established brands, on the other hand, the whiff of bad publicity lingers longer.”

One of the examples cited to support the logic describes how unknown authors whose books received positive or negative reviews by the New York Times experienced an increase in sales, while established authors benefitted from good reviews and were hurt by negative reviews.

What’s the lesson for practitioners in corporate communication and public relations? We’d be interested to hear from our readers on the subject.

Sarah Bonewits Feldner is an Assistant Professor for Communication Studies/Corporate Communication and a major representative for Corporate Communication in the Diederich College of Communication. Tom Isaacson is an Assistant Professor of Public Relations and Corporate Communication in the college.
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The opinions expressed here are those of the individual authors and do not represent the views of Marquette University or the Diederich College of Communication.

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