There is considerable evidence that many M&As fail. Estimated failure rates go usually from 60 to 80 per cent. Despite the increased attention on post-merger integration (PMI), dynamics of how two firms' marketing strategies are integrated have been largely neglected. Considering that M&A activity is predicted to increase as more CEOs use M&A strategies to grow/exit their business, also marketing and communications for post-acquisitions are expected to gain proper focus and attention.
Nevertheless, the lack of attention given today to marketing issues is interestingly in contrast with the findings of merger failures’ analysis, which indicate a lack of proper communication and customer retention activities among the major reasons for such failures. Customers, in fact, tend to stop investments and put their relationships on hold, until a clear message is delivered by the firms.
Competitors often take advantage of the situation reinforcing the negative perception that clients have about the two merging firms; sometimes they take it as an opportunity to steal customers in whichever way they can. To make the situation even more challenging, managerial energy during post acquisitions is often used in internal tasks neglecting customer and marketing-related issues; PMIs are in fact often internally oriented. A possible consequence is that decisions are made predominantly on the basis of internal criteria such as organization, processes, structure. Hopefully, integration will be driven soon by customer-related considerations creating additional customer value rather than reducing the cost of serving them. While marketing will gain the right attention, here is a series of points which I would suggest companies look at before planning any kind of post-mergers integrations.
Communication with All Stakeholders
Mergers involve uncertainty and risk. Communication is essential to focus the organization and to help mitigate these risks. Customers are the first target: they often take their business elsewhere just because they receive inadequate information. A proper customer communication plan should be in place at least a couple of months before the formal acquisition.
But they shouldn't be the only communication target. There is a list of other stakeholders to think about. It’s important to consider which of these are important to the business and to make sure they are communicated with appropriately. Once key issues for each stakeholder group have been identified, the company will be ready to communicate using proper channels.
Internal Communications
Internal communication is the second area of focus. A message sent is not necessarily a message received. People should be sent the integration communication and messages time and time again. Employees need to understand what the firms are trying to do, what the vision is and what they are required to do. Telling people what is going on, what will happen and what we want and expect from them is crucial. With more informal, face-to-face communication in and around the merger the formal material becomes more credible and useful to employees. Even at the risk of over-communicating, it's crucial to create emotional connections between the company and its constituents.
Day-1 and Day-100 Plans
Planning, planning, planning - full integrated plans of intended Marcom activity, at different stages of the acquisition (e.g. 'day-1' and 'day-100') with costs and benefits, together with deadlines, associated actions, dependencies, and risks are a must-do for all integration teams.
Centralized Communication Process
Centralizing the communication process is the key to guarantee consistency around the globe. The central marketing team should release messaging and assets to the countries time before the launch dates, to make sure proper translation and localization of all assets were done in time
Branding Strategy
Individual branding strategy should be released for each of the acquired brands. A 'one size fits all' approach is not going to work and might create dangerous situations with clients and employees of the acquired firm.
No comments:
Post a Comment