5 Situations when M&A can Hurt Your Brand [VIDEO]
Today we’re going to talk about M&A as it relates to your brand and how it could go wrong and what you might be able to do about it.
All right, thanks for joining today, we’re gonna talk about M&A as it relates to your brand, and if you can guess from the little crashed rocket, we’re gonna talk a little bit about how it could go wrong, and what you might be able to do about it. So the first thing we’ll talk about is culture clash, and I think anybody who’s been through a merger or acquisition knows that there’s a potential for culture clash. Sometimes it’s little, it’s a small team, sometimes it’s more pervasive. But let’s go right to the beginning of how these deals come together, and I think you can understand how a brand gets set up for this. Oftentimes there’s principles and kind of behind scenes conversations going on, they don’t necessarily have the benefit of talking to the teams that are going to be tasked with finding a way to work together. Furthermore in today’s connected culture, even the systems that teams use to collaborate can be a friction point. So it’s important that principles and owners and the folks involved with the deal are at least attuned to the culture as they’re going into these discussions, so they know just what kind of challenge lays ahead.
The second challenge that we’re going to talk about is differentiation. And a lot of times in those deals looking at something that sounds really good on paper can lead to a delusion of a firm’s differentiation. What might be differentiated as constituent parts, can come together into more ambiguous hole if you’re not careful looking in. Sometimes the ideas of how we get from A to B might make sense from an internal perspective, but looking from the outside in it’s important to see how the market is going to perceive that combined differentiation of your firm.
You also can’t discount a merger and acquisition as just a major distraction. There’s a lot of logistics that go along with a merger and acquisition, if you’re looking at it from the brand respective. Just think of all of the collateral that needs to be updated, the messaging that needs to be updated. This piece, usually teams might have hives about, but they can work through, it’s pretty logical to work through the steps to combine brands and look at that if a roadmap is in place, but no matter what it’s going to take some effort and some consideration from the teams to get through that, and that sometimes can take your eye off the ball.
So if we’ve delude our positioning externally, and we might be grappling with some evolving roles internally and cultural alignment, imagine what that looks like on the outside. It could lead to marketplace confusion, so it’s really important to have a strong roadmap to communicate a merger and acquisition to the audiences you care about. And when I talk about a roadmap, I’m going beyond replacing logos on letterhead, doing the logistics, website updates and all of those things, but thinking about the transition plan itself. So if a brand that has really strong equity is coming into the fold, perhaps that transition is longer and there’s more communication and associated budget with that, than a brand that’s coming in with pretty light equity and may not be as known in the marketplace, then the larger brand can continue and kinda hold the gravity for that.
So to bring it all together, if you watch out for these potential pitfalls, you can avoid an overall loss of brand strength, whether that’s through delusion, confusion, loss of differentiation within the marketplace. Having a good roadmap in place, working through the logistics, making sure that you’re attuned to aligning cultures within the composite brand can really help make that transition as smooth as possible, and realize the efficiencies and the 1 plus 1 equals 3 formula that everyone is really striving for.
If you’d like to learn more about this, I encourage you to check out our Visible Firm Course on hingeuniversity.com. Thanks, we’ll talk to you soon.
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