When budgets shrink and companies look to cut costs, what gets the axe first? This question is particularly relevant during difficult economic times as procedures are streamlined and excess spending is trimmed. It would be easy to brush off public relations and marketing as expendable luxuries which are not intrinsic to a company’s bottom-line. But in a recent study by the USC Annenberg Strategic Relations Center, CEOs rated PR as one of the top contributors to organizational success. Perhaps it’s time to take a practical look at the value PR dollars add to business.

The comparative value of a well placed article to an advertisement has long been a hot topic. When a product or service is mentioned in an article, it is perceived as the subject of a journalist’s objective review. Readers trust journalists to write with the audience’s best interests in mind. Advertisements, however, are often viewed less favorably. While repeated exposure to an ad will certainly keep a product top-of-mind with an audience, readers often suspect ulterior motives and feel manipulated by sales pitches and profit-turning schemes. Advertisements are also considerably more expensive to place. Purchasing space in a widely circulated publication is astronomically high, especially in comparison to the cost of pitching a story to journalists.

Another important way strategic public relations can drive business success is through strengthening analyst relations. In many industries, analysts play a key role by fostering credibility and creating buzz. Analysts act as a third-party endorsement without a hidden agenda. An expensive ad won’t earn your company a coveted analyst mention. Public relations can play an integral role in strengthening analyst relationships by maintaining consistent communication and securing meetings to discuss new industry developments.

A company’s success is in jeopardy if it falls from the radar of shareholders, media, and current and potential customers. Shareholders need to know how a company is performing, especially during a recession. Any success should be publicized and will likely stand out even more as a triumph over adverse economic circumstances.

When times get tough, public relations is more important than ever in order to maintain a successful public profile.