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From a business perspective, in the long list of aspects to analyze in a merger or acquisition process, few issues are as critical as foreseeing and defining what will happen to the brand. While it may be more or less easy to find the balance between numbers and financials, the reality is that a merger involves many more derivatives. According to a Harvard Business Review study, about 80% of mergers or acquisitions fail.

In most cases, the brand has been relegated and has not been used as a lever for change, clearly transmitting the new value proposition. Often the financial aspects override any other consideration, forgetting that the brand has the ability to translate the business strategy into a framework that makes it easier for its new approach to be easily understood and valued, giving an important reason to all its audiences to believe in the new promise.

Both before and after the merger or acquisition process, it is the responsibility of leaders to consider how they will create value from the brand, one of their main assets.

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From the outset, it is necessary to consider how both companies are going to present themselves to the market, and that involves planning the possible scenarios that will directly affect the brand architecture. Are both brands going to stay alive? And if so, what is your relationship going to be? Or maybe they’re going to merge into one? Which one? Or is a new brand going to be created?

With so many aspects to consider, there are at least 5 big principles that every merger or acquisition should look at in order to get the most out of their brands:

BIG BRAND PRINCIPLES IN M&A

  1. Business strategy and brand strategy must be aligned

This implies that, in addition to finding meaning from a financial perspective, both companies must be able to identify and contrast their respective brand DNA, to translate it into a clear and interesting value proposition for their audience.

  1. The customer is the most important thing

Find out the market’s perception of brands, the opinion of customers and other audiences, identify the positive and negative values that stand out. It is important to develop a coherent brand architecture to ensure that all brands will be able to operate at full capacity. You should always design your future portfolio from a consumer perspective.

  1. Inspire employees

Another of the main elements of failure results from not paying attention to the importance of sharing the corporate culture with all employees. A strong brand with a clear definition of its values will have a much easier time unifying a common way of being and acting, which really has the ability to inspire the team.

  1. Refine branding

There’s no second chance to make a good first impression, your image speaks about you, so it’s an excellent opportunity to refine your identity and strengthen your brand image. Maybe it’s the perfect circumstance to tell a new story or to amplify the one that’s been told so far.

  1. Launch with full conviction

Once you have managed to develop the platform on which you are going to present yourself to the market, a good and properly planned
brand launch
can be a crucial element on the road to success.

While it’s true that preparing before the merger or acquisition is a must, it’s also true that thinking long-term is critical. It is important to think beyond the agreement and pay special attention to the future of the reformulated organization. I don’t know what IBERIA / IAG are going to propose for their recent incorporation of AIR EUROPA, but I’m sure that beyond image issues they will find a great challenge in aspects related to brand culture.

 

Carlos Puig Falcó

CEO of Branward

Photos: Shutterstock

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