By Editor|2024-04-16T19:48:39+00:00April 16th, 2024|Comments Off on Keep Calm: Study finds link between crisis communications and stock prices

Keep Calm: Study finds link between crisis communications and stock prices

A recent public relations and crisis communications study has found that taking an aggressive position in crisis communications can cause a company’s stock prices to fall.

Researchers explored how Monsanto and Bayer handled the fallout from legal concerns related to the herbicide Roundup, which was listed as a probable carcinogen in 2015.

“This study is valuable because it demonstrates how companies can use big data to make informed decisions about how to communicate with the public during a crisis – especially when the crisis is complicated and extends over a long period of time,” says Jaekuk Lee, co-author of a paper on the work and a Ph.D. student at North Carolina State University.

“This work can serve as a template for how scholars and practitioners can make use of big data and artificial intelligence (AI) tools to assess crisis communications campaigns over time,” says Alice Cheng, co-author of the paper and an associate professor of communication at NC State. “For example, AI tools now allow us to assess the sentiment of hundreds of thousands of social media posts in order to capture how a company’s stance shifts over time – as well as changes in how various public audiences relate to the company over time. That would have been almost impossibly time-consuming using traditional techniques.”

Source: https://communication.chass.ncsu.edu/news/2024/04/01/study-suggests-taking-an-aggressive-stance-in-crisis-communications-costs-companies-money/ 

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