Post Merger Branding Strategies for M&A

It’s accepted wisdom these days that when a merger or acquisition is under way, the demands of negotiations and the pressure to close the deal often create a short-term focus and short-sighted actions. When the heat is on, it’s hard to stay focused on how value will be created after the deal. Nowhere is this more true than with brands.

I think the reason being that brand is rooted in market perception and may actually provide a more reliable prediction of future performance. Consequently, the brand may have a greater impact in determining value.

The factor to govern is the period after brand merger, said to be as post-merger branding, which proves as a vital tool for maximizing the value of transaction. Brand strategy in a post merger scenario assumes high significance given the high percentage of M&A failures. As discussed earlier, brands of the two merged companies usually have their own unique identities, personalities and philosophies. As such the fundamental question of brand strategy would be – how to treat these brands – one brand, joint brand, flexible brand or a new brand.

M&As have a tremendous impact on brands. The challenge for companies is to devise a system whereby the basic objectives of the M&A are always kept in mind so that post merger confusions and challenges would not drive the new entity from the set path. Most importantly, all strategies for the new entity should be guided by the underlying brand blueprint so that all post merger decisions are in line with the overall brand vision and is driven by the brand identity.