Public relations and manipulation in the stock market
Public relations can rapidly boost the image of a business, which in return produces sales. PR is a massive tool that can influence not just the perception of the company, but also the stock price of the business. People always tune to business channels and read business articles to know what is happening in the industries. Keep in mind that a fancy rumor can drastically affect the company's stock price.
Advertising is an additional feature that can affect the stock price quickly. An advertising campaign can increase the awareness of the brand, which also influences the present and future demand. Advertising raises people’s perception of a commodity, and they naturally believe that any product that captures the attention of the press is a quality product. Such techniques undoubtedly improve the sales of the product, which also increases shareholder value.
Stock prices are not just affected by sales and government policies; they are also affected by psychological inputs. The perception of positive news is one of the factors that can influence a buyer's behavior. Also, bad news can inevitably affect the entire stock market. Let’s consider the McDonald’s case when news went into circulation that one of the reasons for the increase in obesity is a result of junk food which is McDonald’s primary product. This rumor immediately affected the sales of the company, and their quarterly sales dropped because of a negative PR. That is not the end of the story though. McDonald tackled this challenge with a new and positive campaign called “We’re Loving It,” and in no time sales picked up, and their stock increased in value again.
PR can help to change narratives, by creating a new perception. It establishes a standard for a company and provides new lexicon regarding the way the press and public see the company.
PR should be an on-going activity in a company, and a company shouldn’t cut ties with their journalist even when everything is going well. There should always be a continuous relationship. Positive PR will always guide a company’s reputation and protect the company from bad comments and critiques.