Same crisis: different impact in different companies

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In the development of their activities firms are influenced by many forces, some of them positive but other negative, that make up the environment the company. Within these factors, the economic is a key element with a large impact on the behaviour of all organizations. The current economic crisis we are now crossing has affected all firms in all industries to a great or small extent. However, we could say that the media industry has been one of the most negatively affected by the crisis. This has involved a substantial decline in the activity of media firms, with consequences for the employment of professionals, in the definition of the strategy of the most outstanding companies and in their profits.

This fall is the outcome of a vicious circle that far from being broken keeps working with the new data that appear. The economic situation is depressing, firms do not see the way out in the short term and try, as far as possible, to cut expenses. In these saving efforts, one of the items easier to cut if the advertising budget, since even today commercial communication is considered by most companies as an expense and not as an investment. The repercussions that these sharp declines in advertising investments have had on newspapers, magazines, radios, televisions and in general on conventional media, has multiplied for these firms the negative impact of the crisis. A yearly two digits fall in income implies an important readjustment in the size of the workforces of these firms and a decline in the profits that for many companies leads entering in the world of losses. In this context it is important for firms to make and effort to remain in the market, knowing that the economy is cyclical and that after the crisis recovery comes. However, if the negative situation continues, the time that firms achieve to stay in the market, will depend on the quality of strategy formulation, so that bad managed firms will be the first to leave the market. Cristina Etayo.

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