Kathy Floam-Greenspan is the President of Pomerantz Marketing, a full-service B2B agency supporting regional, national and global SMBs.
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A company’s brand is its most valuable and important asset. Regardless of sector, product offering or customer base, this intangible resource separates successful businesses from the competition. In the B2B sector, which requires prolonged sales cycles for enterprises to become recurring customers, long-standing brand value is especially critical.
It may not be reflected on its balance sheet, but a company’s brand brings immense value to a merger or acquisition (M&A). As a recent Deloitte report succinctly explains, “The value of a strong brand cannot be underestimated in today’s fast-moving commercial environments, where customer loyalty is notoriously difficult to acquire and sustain.”
Consequently, B2B brand consolidation is a critical—if often overlooked—component of an effective merger or acquisition.
With M&As accelerating in today’s disruptive, high-stakes B2B landscape, companies must maximize value and opportunity from the process, requiring a strategic brand consolidation plan that produces needed results.
Here are three ways companies can implement a strategic brand consolidation plan from day one.
Establish Direction
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Effective brand consolidation is predicated on careful planning to establish the direction for the M&A process rollout, including internal and external communications.
Without planning, brand confusion and haphazard online deployment quickly undercut the process. For example, consider just a few common pitfall scenarios for B2B companies that are trying to maintain continuous, trust-building relationships with their customers:
• Two companies merge, but insufficient planning complicates brand consolidation and rollout, producing websites with mixed branding, confusing visitors and diminishing the impact of an important merger or acquisition.
• An organization acquires several companies that are designated as subsidiaries. Failure to plan and communicate with internal stakeholders creates a haphazard online rollout where subsidiaries don’t link back to or reflect the parent company.
• A merger or acquisition produces two online platforms of differing quality, value and maturity. Forward-thinking leaders will enlist help to evaluate online assets to facilitate an expert-derived, data-driven decision about which website should remain online as a reflection of the company’s consistent and cohesive brand standards.
M&As exist to increase the value of the parent brand, but this outcome is compromised when poor strategy and planning for brand and web presence create confusion and erode quality.
Instead, a lack of direction can have a detrimental effect for employees, customers and strategic partnerships. It also diminishes brand strength, as reputation and visibility both take a hit.
That’s why establishing direction must be a top priority implemented at the beginning of the M&A process.
Optimize B2B Customer Engagement
A brand outcome must be aligned with business objectives. Often, this means that acquirer branding takes precedence. However, that isn’t always the case, and decision-makers should carefully consider the brand equity, strength and market segmentation associated with each brand before making long-term decisions.
Ultimately, B2B companies want to preserve or transition existing customers. To optimize B2B customer engagement, consider launching a campaign to customers—including press release announcements, an email from company leadership, website banners, social media posts or a monthly drip email campaign—that gradually informs customers about the M&A value while introducing new offerings.
Since companies frequently fail to conduct market research into customer engagement trends, including if they are likely to switch to become customers of the acquiring company, a strategic approach can be a differentiating factor that separates successful mergers from those that fail to meet expectations.
Account For Costs And Complexity
An effective brand transition is difficult, adding to the cost of the M&A process. As a result, many companies are content to wing it, making real-time decisions without evaluating the long-term repercussions of a haphazard M&A process.
By accounting for the costs and complexities of a brand transition early in the process, leaders can allocate resources appropriately while more accurately assessing the cost and potential value add of a merger or acquisition. This might include:
• Creating a cohesive brand voice from multiple companies.
• Aligning messaging, timing and personalities as power struggles are common during the M&A process.
• Establishing communication methodologies.
• Conducting an internal review to determine approval processes.
• Aligning marketing platforms and databases.
While the cost of rebranding varies significantly based on scope, sector and time frame, it’s worth accounting for costs and complexity at the beginning so an effective M&A process isn’t cut short by B2B leaders unprepared for the extent of branding decisions.
Promoting Success With Planning & Strategies That Work
M&A activity is at an all-time high as companies leverage the process to facilitate growth, expand market share and connect with more customers. When executed effectively, they can be wildly successful, creating immense value for buyers and sellers.
And yet many consolidations fail to deliver the promised outcome and expected synergy that leaders imagined. Consequently, it’s estimated that between 70% and 90% of M&A deals ultimately fail. The reasons are multifaceted, but the far-reaching repercussions of ineffective brand consolidation are a significant factor.
Simply put, effective brand consolidation isn’t a walk in the park for any company, but especially not for B2B organizations. It’s a web and a puzzle that takes strategic planning to solve. It’s a challenge worth taking from the very beginning of the M&A process.
To enhance results, brands should consider the channels in which their customers best receive information. Some customer verticals or markets may prefer email or various social media platforms while others might be more responsive with direct mail and calls. Regardless of the approach, it’s important for marketing to tap into the knowledge of sales within each company to best understand customer demographics and communication preferences to craft a campaign that will reach and resonate with them.
Fortunately, by answering critical questions and formulating a strategic brand consolidation plan that guides the process from day one, businesses can improve outcomes for all stakeholders.
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Author: Kathy Floam-Greenspan, Forbes Councils Member
