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While the world was preoccupied with lockdowns, baking bread from scratch and enormous cultural shifts like working from home, the business world saw some notable mergers and acquisitions. Salesforce acquired Slack. T-Mobile acquired Sprint. Morgan Stanley acquired E-Trade. And the list goes on.
Developing a strategy for marketing after a merger or acquisition can be a leader’s greatest challenge and biggest opportunity. It’s an exciting time, ripe for creativity and the development of ideas that may have been percolating for a while. Now that you’re one team, how do you start your rebranding efforts?
McKinsey said it well: “Marketing plays a vital role in integration and deal success and should not be an afterthought. Rather, marketing after a merger should lead the organization in developing fresh, compelling value propositions and setting the new organization’s brand strategy.”
This is the time for marketing leaders to shine, applying some key considerations:
We know that a business acquisition will drive new brand development. Much research exists about the way to approach taking inventory and getting started. At Kuno Creative, we’ve navigated the marketing piece of the mergers and acquisition puzzle for several clients. We like to focus especially on the acceleration of innovation that the combining of companies allows.
When the message of the merger is clear that it is enabling everyone on the new team to be better together, it’s hard to argue. This was the emphasis in the Salesforce and Slack acquisition, as noted in a 2020 TechCrunch article talking about the complementary nature of the new relationship. In their case, the acquirer Salesforce, a global ERP company noted for their business process platform, purchased Slack, a smaller company known for its virtual place to collaborate, communicate and manage projects. There was an inherent complementary relationship between them and the value proposition to customers was clear: Customers would have an unparalleled platform for productivity and collaboration.
Brandwise, both Salesforce and Slack had a distinct identity, and part of the deal was that they would work together to ensure that remains the case.
This example symbolizes the importance of communicating internally that the integration of companies, their products/services and their talent and experience will result in best-in-class solutions for customers. Marketing after a merger or acquisition includes internal communications, and emphasizing this takeover will also foster a sense of pride for employees.
Through mergers and acquisitions, customers may already feel like their loyalty is being tested. The key is to rapidly integrate acquired companies and define a new brand position that captures the improved value.
Focus on what will be great about the combination of the two brands. Emphasize how much better the product is going to be for the customer. Tout opportunities for employees to grow and collaborate with new colleagues.
Ultimately, the team will delve into the complex task of establishing a new set of brand guidelines. It’s difficult to get one company all on the same page visually, tonally and asset-wise. Trying to develop two sets of every piece of the marketing pie into one is even harder. To put this into perspective, McKinsey reports that 80% of companies complete a brand transition within 18 months of a deal closing. That means that marketing teams have to dive into taking inventory right away.
Among some of the foremost decisions:
Most recently, the internet sensation and 2022 darling Wordle, was acquired by The New York Times. While no merger or acquisition is perfectly smooth, this purchase and integration seemed to lack a marketing strategy and it hit preventable speedbumps.
This should have been the greatest thing since alphabet soup. So what went wrong?
In this case, the customer attachment to the brand didn’t seem to be taken into consideration.
When the Times began removing words it deemed offensive, it started to change the DNA of the popular game. Customers took to Twitter and other social media to complain directly to @NYTimesGames when the new parent company urged them to migrate to the new platform.
This merger broke a common sense rule: The preexisting customer culture was not taken to heart.
In the February 15, 2022 edition of PR News, Professor Lawrence Parnell, program director of strategic PR at George Washington University, noted the prevalence of mergers and acquisitions gone wrong. Citing Harvard Business Review, Parnell says “three of 10 mergers succeed as advertised.”
Parnell blames these unfavorable statistics on communication. “I think you have to start from a point of view of understanding the culture of the organization that you’re bringing into yours, and not assuming that they’re just going to adapt to your way of doing things.” The same could be said for the customers you’re acquiring along with the company.
When a brand is beloved, strive to understand why customers value it, and why internal stakeholders believe in it. Make the case for why the M&A makes sense. For example, The New York Times could have messaged customers that it was a natural fit for a publication that has been publishing a crossword puzzle since 1942 to acquire a word game.
A smart way to position new branding or marketing in any merger or acquisition is to emphasize the breadth of expertise the customer can expect from the enhanced team. The new combined subject matter experts will collectively work to develop better products and services. And better products generally mean a better user experience, a key ingredient in any marketing strategy.
In many instances, companies that have merged have something in common, hence the partnership. This makes for an easier transition. But never take the value proposition for granted. Emphasize it internally and externally.
However, in anticipation of becoming one, the brand that is more robustly defined or has a more distinct employee culture can consume the other brand, leaving employees feeling rudderless. Marketing leaders need to consider the strengths of both companies and find common ground.
The Slack-Salesforce merger reflected two companies with branding that felt different, but the merger was clearly complementary. Their stories have focused much of their rebranding on the collaborative nature of their products and just how much more collaboration will happen now that they’ve merged.
Both Slack and Salesforce are centered around communication and project management. Salesforce also enabled sales pipeline initiatives, so integrating Slack as a tool that teams use every day to communicate created a comprehensive, powerful, real-time productivity tool. The message is one of streamlining business processes and enhancing the user experience.
In TechCrunch, Slack CEO Stewart Butterfield said this: “By putting Slack in the middle of business processes, you can begin to eliminate friction that occurs in complex enterprise software like Salesforce.”
The two companies had a different brand look and feel. Salesforce is generally considered a stalwart in the business world, focused on sales and marketing. Slack was popular for enabling convenient chatter and collaboration between colleagues — and was especially embraced by Silicon Valley. Their colors and logos were very different, yet their overarching goals aligned.
As you navigate marketing after a merger or acquisition, composing the new value proposition and nailing down the messaging, there are tactical “to-dos” that are key pieces to the marketing puzzle. These three items should be top priority.
Reviewing buyer personas and identifying where they overlap or diverge is essential to understand who you are marketing to in your new business model. The relationship between buyer personas and brand identity is essential to viewing your buyer with empathy. Empathy will be in demand when customers are confused about the M&A and are seeking clarity from you.
From logos to podcasts and every other marketing asset, what will your brand look like after a merger or acquisition? Feel like? Sound like? And of course, there’s your website. At Kuno, we speak from experience when we say few marketing teams are thrilled about overhauling their company’s website. That’s because a website redesign requires a significant upfront investment of time, financial resources and labor. But these investments are critical to creating a cohesive, meaningful experience that reflects your post M&A initiatives and makes customers feel at ease.
What CRM or CMS will you use? Will you need to reevaluate your tech stack entirely? While there are many platforms that promise to serve different pieces of the marketing puzzle, you could opt for a more comprehensive product like HubSpot that puts everything in one place and enables continued growth for the future as your team and efforts scale.
When you’re ready to promote the new brand after a merger or acquisition, as part of a comprehensive inbound marketing strategy, produce a new brand video. This video could live on an updated home page. Feature the entire team at work together, and highlight offerings to showcase your new brand story. What’s more, it’s a fun piece of content to share on social media, potentially driving leads to a landing page that further defines the new brand vision.
When you work with an experienced inbound marketing agency like Kuno, you can navigate mergers and acquisitions with compassion for employees, customers and the brand from the start. To learn more about how we can support your marketing efforts throughout every phase of a merger or acquisition, schedule a consultation.