Using the power of brand for success in mergers and acquisitions

Perspectives - August 2021
By Veb Anand

Principle | Using the power of brand for success in mergers and acquisitions.

Mergers and acquisitions are an everyday reality for business leaders. While activity may have stalled during the pandemic, they are predicted to bounce back, even accelerate, in the aftermath of this crisis. 

With barriers to entry lower than ever and revolutionary disruption taking place across every sector, this report looks at the crucial role brand plays in achieving M&A objectives.

Post-deal clarity, alignment and integration are only possible when there is a solid understanding of the role of brand, how to position the new organisation(s), how to craft a portfolio for future growth, and most importantly, what it will take to implement brand transformation.

While activity may have stalled during the pandemic, they are predicted to bounce back, even accelerate, in the aftermath of this crisis.

Report highlights:

● Post-deal, effective cultural integration remains one of the biggest challenges...and one of the biggest risks.  
Over 50% of companies that don’t effectively manage culture when going through a merger or acquisition report that they don’t achieve synergy targets. If managed actively, organisations’ brands can become key tools in helping achieve better integration by illustrating the benefits of the deal to all stakeholders, engaging employees and achieving other M&A objectives like cost management and customer retention. 

● Crafting the right portfolio strategy sets the baseline for effective integration.
The first challenge with M&A is to understand how to structure and define the combination of brands after a transaction. It calls for an objective assessment of the brands’ strengths and weaknesses, fit with the future vision and the degree of overlap in propositions. 

● Speed is key...and downtime isn’t an option.
The speed at which brand changes are implemented post-transaction can mean the difference between success and failure. There is a need to very quickly signal that the deal is working, the strategy is sound, and that execution on goals is decisive and faultless.

● Manage global integration at a local level from the start.
Multinational mergers present their own unique challenges. Merging global organisations need to ensure that all culture, design and activation solutions developed to support the merger not only take into account the central positioning and proposition, but also bring each markets’ requirements into the mix.

● Enhance the customer experience and build credibility simultaneously.
The challenge of different brands coming together can mean that combined organisations are required to serve customers under multiple brands with conflicting priorities and standards in the short to medium term. New or re-positioned brands can achieve quick wins by creating distinctive, signature experiences.