Why Is Communication Important in Business?

If you’ve stumbled upon this article, chances are you’ve been asking yourself, “Why is communication important in business?” Allow us to answer that for you! The importance of business communication to your company’s success cannot be emphasized enough. Think of the way you communicate as your brand image, and treat it with that level of strategy. 

Communications encompass every aspect of your business, from face-to-face chats over the counter to your marketing emails. Consistency is crucial. Here’s why you need to have an effective business communication strategy across the counter, on the phone, in written communication, and across all digital media.

Grabbing the top spot, or even the front page, on a Google search is not easy. There’s a lot of competition and everyone wants the same spot. How can a small business compete? Let’s find out.

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What Is Business Communication?

At its core, business communication encompasses the exchange of information within and outside a business. This exchange can take various forms, including written documents, verbal conversations, presentations, and visuals. 

Internal Dynamics

Internally, business communication involves the flow of information among employees, departments, and hierarchical levels. It’s the lifeline that keeps different parts of the business interconnected and working in harmony.

External Engagements

Externally, business communication extends beyond the business’s front door. It encompasses interactions with customers, suppliers, partners, regulatory bodies, and the broader industry. These external exchanges are critical for building relationships and fostering collaboration.

Key Components of Business Communication

Business communication is not limited to a singular method. It incorporates a spectrum of elements:

  • Written Communication: In the form of emails, reports, memos, and documentation.
  • Verbal Communication: Including meetings, presentations, and everyday conversations.
  • Digital Communication: Through various digital platforms, such as social media and other online channels.
  • Visual Communication: Through charts, graphs, and multimedia presentations.

Purpose and Impact

The ultimate goal of business communication is to convey information effectively, ensuring clarity and understanding among all stakeholders. It plays a pretty important role in team management, decision-making, problem-solving, collaboration, and, most importantly, in achieving your overall business goals.

The Importance of Effective Business Communication

Efficient business communication is the cornerstone of a well-functioning machine. It aids in preventing misunderstandings, streamlining processes, fostering a positive workplace culture, and enhancing the overall efficiency and productivity of the business.

Adapting to Diverse Contexts

Business communication is versatile and needs to adapt to various contexts, whether it’s negotiating a deal, addressing a customer concern, presenting a proposal, or conveying internal policies. The ability to tailor communication styles to different situations is a valuable skill that should be routinely fine-tuned.

Continuous Evolution

In the dynamic business landscape, communication methods change, evolve, and even disappear. Technological advancements, cultural shifts, and changes in consumer behavior all influence how businesses communicate. Staying attuned to these shifts is vital for maintaining relevance and effectiveness in communication strategies.

The Benefits of Effective Business Communication

Communication is obviously necessary to do any kind of business. You communicate with customers, employees, suppliers, other businesses, and the community at large. And still, some small businesses don’t seem to have a consistent communications strategy. 

Here are all the reasons you should take communication strategy seriously:

1. Communication Reinforces Brand Messaging

With every public or private communication, you give away information about your brand, whether you realize it or not. That’s why it’s important to establish a company policy on how to talk to customers. Is your company friendly, upbeat, and relaxed? Or do you want a serious, professional tone without a lot of chat? 

The tone you take with your customers should depend on who your customer base is. A software company whose customers are financial professionals would speak an entirely different language than a store retailing surfboards.

The key is to know your customers. Who they are, how they speak, and what they want. With customer knowledge in hand, you can develop an approach to communications that defines and reinforces your brand. This voice, or brand persona, should be consistent across your message, your marketing, and every aspect of communications. 

2. Communication Builds Customer Relationships 

Relationships, especially with customers, are incredibly important in today’s business world. Communication is key when it comes to building strong relationships and will ultimately benefit your business. 

Using positive language in emails and negotiations is a good way to keep a potential customer happy and feel comfortable with you. Sending personal notes or offers to a prospect on their birthday or another significant date (without attempting to sell them anything) is a great way to build a solid client relationship and keep them content while doing business with you.

3. Communication Boosts Creativity and Innovation

Giving your employees and customers the freedom to express ideas without fear of judgment is important when it comes to business communication. This way, creativity and innovation can develop and good business ideas can become great ideas. 

If something is not working as it should, the problem is only likely to come up if your employees feel comfortable sharing feedback. Open communication is also crucial when it comes to creating new promotional sales, improving products and services, analyzing customer feedback, making informed decisions, and sustaining business. 

4. Communication Encourages Feedback

Encouraging feedback from employees and customers is incredibly valuable to maintaining and improving your business. Customer reviews can also put your business out there to new potential customers and help your company grow and profit. 

Communicating with your customers about their experience with your product or services not only allows you to develop your communication skills further but also helps build trusting relationships and return business. 

5. Communication Boosts Employee Morale

Customers are not the only beneficiaries of effective communications. Your employees benefit as well, and it shows in the numbers. In general, small businesses are more personal and communications are simple, and as a result, 80% of people who work for small businesses feel valued and heard, and that makes them happy. The increased employee engagement that comes with open communication can positively impact your bottom line. 

How to Communicate with Employees

How to Communicate With Customers

Communication is the lifeblood of any organization, fostering an environment where ideas flow, expectations are clear, and relationships flourish. Effective communication helps align goals, enhances collaboration, increases productivity, and keeps a cohesive company culture, among other benefits.

The types of workplace communication are the following:

  • Leadership Communication: Leaders should be transparent, provide clear directives, and set expectations. Regular updates and a willingness to listen can foster both trust and respect.
  • Upward Communication: Encourage open channels for feedback. Create platforms for employees to express ideas, concerns, and suggestions. Ensure that upper management is approachable and responsive.
  • Meetings: Define clear objectives for meetings. Distribute an agenda beforehand. Encourage active participation, and follow up with concise meeting minutes to ensure everyone is on the same page.
  • Presentations: Tailor presentations to the audience. Use visual aids to enhance understanding. Encourage questions and provide a forum for discussion after the presentation.
  • Announcements: Choose appropriate channels for announcements, such as emails or meetings. Clearly convey the key information and address potential concerns. Allow for questions and provide additional resources if needed.
  • Informal Interactions: Foster a culture where informal communication is valued. Encourage team-building activities, coffee chats, or virtual hangouts. This helps build rapport and strengthens interpersonal relationships.

Business Benefits of Effective Internal Communication

With effective internal communication, the following benefits can be seen:

  • Better Engagement: Engaged employees are emotionally invested in their work. Effective communication fosters engagement by keeping employees informed and connected to the organization’s mission.
  • Improved Morale: When employees feel well-informed and heard, morale skyrockets. A positive workplace culture, reinforced through effective communication, leads to greater job satisfaction.
  • Better Collaboration: Teams that communicate effectively share ideas, provide constructive feedback, and work seamlessly toward common goals.
  • Less Conflict: Miscommunication is a breeding ground for conflict. When communication is transparent and open, misunderstandings are minimized, reducing the likelihood of conflicts arising.
  • Reduced Employee Turnover: Employees are more likely to stay in an organization where they feel valued and connected. Effective communication contributes to a positive workplace environment, leading to reduced turnover.
  • Improved Customer Service: External communication often mirrors internal communication. Employees who understand their roles and feel supported are better equipped to provide excellent customer service, creating a positive image for the company. 

How to Communicate with Customers

It’s important to not just chat with customers but to communicate in a meaningful way. With focused communication skills, you can build your customer knowledge and make your customers feel heard and valued. Effective communications focus on these areas:

  • Share Information: Keep your customers up to date on sales, special offers, new products and services, and company news. 
  • Share Your Knowledge: Offer tips, tricks, use cases, and storytelling to connect with customers and answer their pain points. Be a go-to industry information site full of information about your industry and products.
  • Ask for Ideas: Who knows what customers want better than your customers? If you ask and listen, they’ll provide you with invaluable information you cannot get any other way.
  • Address Complaints: With today’s instant global communications, the way you respond to complaints is more critical to your company’s image than ever before. Act fast, be courteous, and do your level best to make things right.
  • Ask for Reviews: When your customer pays you a compliment, ask them to make it public. Happy customers are usually happy to help—if you ask. Online reviews are trusted by 84% of consumers and 87% won’t even consider doing business unless you have at least 3 stars! Tip: 15 Clever Ways to Ask for Reviews

Business Communication Channels

Why is communication important in business

Face-to-face communications are great, but not always practical. Today’s digital customers expect the full spectrum of communication options, and it’s not easy to be everywhere. As a small business owner, you’ll have to focus on those areas where you can best serve the largest number of customers. Here are some methods to consider:

Communicating on Your Website

Web chat is a great way to address customers when they need help most. They come to your website seeking answers, and a web chat agent can answer common questions immediately. For a small business, a fast response is often the difference between a missed opportunity and a sale. In our survey, 55% of small businesses think they have an hour or less to respond to customers before they move on.

Social Media

Today, almost everyone is on some sort of social media platform. Advertising and interacting with your customers through them is incredibly impactful.

A strong social media presence promotes your products and/or services to a variety of new people who may have never even heard of your company. It is not only important, but it is also super easy to communicate, both privately and publicly, through your social media pages

Your Email Lists

Giving your customers the option to subscribe to an email list is a great way to get the word out about promotions, specials, new products, and more. Offering incentives for people who sign up for your email list can allure more customers to join and news about your company will spread to more people and update them about your business. 

Telephone Communication

Professional Phone Etiquette

Effective business communication involves articulate conversations, both within the company and with external contacts. Ensure your speech is clear and concise so the person on the other line can clearly understand you. It might be a good idea to adopt a professional and amiable tone but avoid unnecessary jargon and business-speak that might alienate or confuse the person you’re talking with.

It’s important to note that more important than active communication is active listening. Understanding others’ needs is crucial for providing thoughtful and constructive responses. Don’t be afraid to keep a pen and paper handy to make sure you can jot down this important information.

Enhancing Your Verbal Communication

Problems can be challenging to navigate. Brushing up on your problem-solving skills to address inquiries or concerns can help you diffuse difficult situations and foster positive phone interactions.

Video Call Etiquette

Embrace the nuances of video calls, as they require a different set of skills compared to traditional phone conversations.

Some good pointers include:

  • Checking your camera and audio before the meeting to ensure everything is working.
  • Ensuring your background is tidy and free of distractions.
  • Confirming your internet connection is stable and able to handle a video call.
  • Counting to two after the other party ends their sentence to avoid talking over each other.
  • Have a backup plan in the event of poor connectivity.

Interpersonal Communication

Active Listening

When it comes to interpersonal communication, the best skill to have is active listening. This means actively listening to analyze and process what you are being told. Be careful not to interrupt others or impose your solutions as a fix on those already imposed—rather, present them as suggestions or other options. Keep an eye on your tone of voice, word choice, and body language when communicating.

Body Language

Part of communication is non-verbal communication, which can come from your body language. This is especially true of conversations that are had in person or over video calls. Nonverbal cues are merely communication at a subconscious level, which makes them that much more potent. Your body language can help punctuate your point when it matches what you are saying verbally, but can also undermine your message if the two don’t align. Train employees how to be mindful of body language when engaging with customers as well.

Visual Communication

Strategic Visual Elements in Business

Visual communication encompasses the strategic use of images and designs to convey business-related information effectively. It goes beyond text, offering a visual narrative that complements textual communication perfectly on visually-driven platforms.

Nailing the Aesthetic

Uphold a consistent and visually appealing brand image, encompassing elements like your company logo and marketing collateral. 

The color wheel is also your friend. Employ harmonious color schemes and well-thought-out designs to enhance brand recognition.

Inclusivity and Simplicity

Foster an inclusive image by considering inclusivity in your visuals and reflecting kindness and consideration for diverse audiences. Some great (and free!) resources for inclusive media include:

On that note, keep things simple. People skip over visuals that are too busy or unclear. When you opt for simplicity in your designs, you ensure what you are promoting is easy to comprehend while maintaining the professional aesthetic you’re going for.

Become a Communication Guru with Broadly

Without a successful communications strategy, your brand has no image. Creating lasting, trustful, and positive relationships with customers and employees is critical to running a successful and profitable business. Discover what Broadly can do for your communication strategy by scheduling a demo with us.

Watch your online reputation transform with Broadly

This article was updated on March 14, 2024.