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Internal communications business is booming for PR firms like Edelman, Prosek, and Kekst CNC as CEOs scramble to reassure remote workforces and plan for a return to the office

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  • Edelman, Ruder Finn, Prosek Partners, Kekst CNC and other big PR shops are picking up work during the coronavirus even as corporations slash marketing budgets.
  • Clients are scrambling to update their employees about health and safety issues, motivate remote workers, and plan for a return to work.
  • Internal comms was already growing as employees demand more of their employers and the line between internal and external PR is increasingly blurred.
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Even while corporations slash their marketing budgets, employee engagement is a booming area for PR agencies including Edelman and Kekst CNC as CEOs scramble to calm a jittery workforce.

One of the grimmest tasks for a chief comms officer in this environment is delivering layoffs, furloughs, and health and safety news. Last week, the Labor Department announced 22 million Americans are unemployed, erasing all job creation since the Great Recession post-2009.

Several agencies told Business Insider they were being hired for internal comms assignments.

"Everyone is parsing their PR spend: Is it nice or is it necessary?" said Jen Prosek, founder and CEO of Prosek Partners. "Crisis, special transactions, strategic comms, and employee engagement are in the absolutely necessary bucket."

PR firms with a history of internal comms work are positioned to benefit

PR agencies that have established internal communications practices continue to pick up work.

Edelman has been growing its internal comms business at a double-digit rate after making it a core part of its corporate practice a few years ago, and Jim O'Leary, global corporate chair, said the firm expects to see revenue growth in the range of 10-20% in employee engagement this year despite the economic downturn.

All of Kekst CNC's work now has a "significant internal component," co-CEO Jeremy Fielding said. "Employees want management to show leadership, to be transparent and empathetic."

Ruder Finn said it's had an uptick in internal comms work since the coronavirus pandemic struck, a year after acquiring SPI Group, a firm that specialized in internal comms and adding 30 more staffers to its roster. Today, Ruder Finn has about 115 people in internal comms worldwide.

"When this hit, we were pretty well placed and stepped in aggressively to help companies of all sizes increase internal comms as a first priority," Ruder Finn CEO Kathy Bloomgarden said.

Internal comms is dealing with issues beyond health and safety

As remote work drags on, chief comms officers are busy telling workers how to improve their productivity, keep up their mental health and spirits, and arrange town halls.

Ford chief comms officer Mark Truby previously told Business Insider that internal comms was its greatest challenge as it held virtual town halls that averaged 25,000 to 30,000 attendees.

As talks turn to a recovery and reopening offices, chief comms officers are thinking about what's next.

"Clients are thinking through how they provide coronavirus-related information to workforces in real time [as well as] how they navigate the crisis, how they'll return to work, the economic recovery, and beyond," O'Leary said.

The effects of the pandemic could be felt into 2021 and beyond, and the PR playbooks used now will provide an important foundation as the world braces for more waves of coronavirus, Bloomgarden said. As work gets more flexible, companies need to establish strong internal connections to keep everyone on the same page.

The pandemic will cement the importance of internal communications

Internal comms was on the rise before the pandemic, fueled by an intensified war for talent, employee activism, and the digital revolution.

"Three or four years ago, employee communications went from the back of the bus to the front of the bus," Prosek said.

People are expecting more transparency from companies. Internal documents can be leaked. PR pros recognize they can't talk to employees differently from how they talk to customers, regulators, vendors, investors, and the general public.

"There's a very permeable barrier between where your comms with employees starts and stops and where your comms with the rest of the world starts and stops," Fielding said. "That's a good thing, candidly."

And with the pandemic, companies are speeding up adoption of online communication tools like Slack, data analytics, and automation.

One of Gagen MacDonald's clients temporarily suspended its contract after the coronavirus pandemic struck, said Steve Astle, senior adviser and West Coast lead at the internal comms firm. The client returned three weeks later.

"Companies undergoing transformation leapfrogged many of the things they were going to do as part of their transformation plan," Astle said. "It's almost like the trajectory has changed, but the pace is faster."

SEE ALSO: PR giants like Edelman and Sard Verbinnen are seeing a surge in demand as companies seek to minimize damage from the coronavirus pandemic

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