by Lee Flynn

Effects of Bad Publicity on Businesses

3 years ago | Posted in: Business | 2325 Views

Publicity and reputation have a direct impact on the performance of your business. This is why it is important to ensure that your business enjoys a good reputation most of the time. In a world where consumers have become more discerning and have numerous options from which to choose, bad publicity can result in a business losing its customers to competitors. With the stiff competition that characterizes the business world, it is important for businesses to take care of their reputation. However, in order to do this effectively, business owners and managers should first understand the effects of bad publicity on businesses. This will help in coming up with strategies to manage bad publicity both online and offline.

Loss of Trust

One of the ways through which businesses ensure that different stakeholders have confidence in them is by remaining consistent and true to the values they stand for. Indeed, it takes a long time to build and maintain trust among customers, employees, suppliers and other partners. In the event that lies or inaccuracies that cast doubt on the capabilities of the business emerge, there is a good chance that trust will be lost and the image of the company will be dented. When bad publicity leads to loss of trust, business managers have to ensure that trust is regained.

Impact on Hiring and Staff Morale

Both current and prospective employees will feel safe when the business they are associated with enjoys good reputation as well as relative stability. Once bad publicity affects your business’ image, there is a possibility that prospective employees will shy away from seeking employment opportunities in your company. When this happens, you will find it difficult attracting the best talents in the job market. Similarly, your current employees may be demotivated, a factor that is likely to have adverse effects on productivity.

Diminishing Sales

For most businesses, generating revenue and making profits remain some of the most important objectives. This is why businesses always strive to increase their sales. Bad publicity may affect how customers view your business, a factor that could dissuade them from dealing with your business. The direct consequence of such events would be diminishing sales, low revenue and financial losses. Business managers must always introduce remedies to make sure that bad publicity does not affect the perception of customers about your products.

Damaged Brand Equity

Today, a good number of customers associate different businesses with their brand images. In the event that the brand image suffers, customers may not want to buy your company’s products. Bad reputation has the potential to damage your brand equity in the long term. Issues such as inaccurate information in your marketing messages or rumors about your products can result in customers having a negative perception of your business.

Diversion of Resources

With the serious effects that bad publicity can have on your business operations, it will be necessary to take the necessary measures whenever you face a reputation crisis. This will mean diverting resources that had previously been allocated for other activities. When financial and human resources are channeled towards addressing such a crisis, it is possible that other aspects of your business will suffer. This could affect your operations in a significant way.

The Positive Effects

There are times when your business will be faced with a reputation crisis. There have been numerous examples of companies being targeted unfairly. An example of this can be seen from those who perpetuate the idea that retailers from lularoe scam their customers. However, if your business and products are not well-known, this could help you to create awareness about your products. This will allow you to attract new customers and boost sales. However, you will need to handle the crisis well if you are to realize these positive effects.


Once you understand the effects of bad publicity on your business operations, you will be in a better position to manage your reputation. The good news is that you can enlist the help of professionals to ensure that you make the most of the situation, effectively benefiting from the crisis.



by: Lee Flynn

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