One of the issues businesses face after undergoing mergers or acquisitions is how to deal with the ensuing ‘brand stew’ - the assembly of brands now falling under one umbrella.
There are, of course, numerous well established approaches, tried and tested, that are applicable when two organisations, each with a single dominant brand, merge (or when one is acquired by another). However, the challenge increases exponentially with each new brand added to the mix.
This can become a real problem for businesses that grow by acquisition - especially those that grow rapidly, so that new brands are being added to the equation before previous decisions have been bedded down, or the strategy even properly considered. In addition, each acquisition may bring with it numerous sub-brands and brand assets which can only complicate matters further.
The implications of this to business performance are significant. Brand confusion undermines the coherence and synergies that are critical to the success of the merger in the first place. Without an effective brand strategy, employee, motivation and focus is affected and staff turnover may increases dramatically. Productivity suffers and costs increase. At the same time, the marketplace becomes alienated and revenue can suffer accordingly - a toxic recipe indeed.
In cases like this, there are so many variables that no single solution can resolve every issue in all circumstances. However having a structured approach (such as the one below), with a clear vision of the desired outcome can simplify decision making considerably.
Resolving your brand architecture
The following is a solid basis for resolving your brand architecture issues:
1. Audit your brand assets
Audit all of the brand assets within the respective organisations' control. Ownership of this IP, even this that fall under brands that might be discontinued, may be very valuable — either immediately or at some point in the future.
2. Create a clear vision of the desired brand structure
Create a high level vision of what brand architecture you want to have moving forward. It is important to build your brands architecture from a consumer perspective — what makes sense to them, rather than base it on internal operational structures.
3. Identify brand equity
Identifying the brand equity inherent in every brand in the mix can range from simple to rather complicated as there are numerous different measures of value — most of them intangible. However consideration should be given to consumer sentiment, economic trends, internal culture, longevity of the brand to date and bottom line performance.
4. Evaluate the brand relationships
There are several different ways in which brands can be resolved in such circumstances. The solutions range along a spectrum from 'continuity' to 'change'. The decision as to which brands need to be deleted, which need to be merged (and how), can now be made taking cognisance of the information gathered and developed above.
Mergers and acquisitions are seldom easy, and there is nearly alway some pain and even dissent amongst consumers, employees and shareholders when brands are culled or altered. But it is important to know that time alone seldom heals these wounds and delaying tough decisions only allows them to fester.
Each brand decision you make sends a signal about your future intentions that will spark a response from your stakeholders, and regardless of the pain, they all deserve to know which way the organisation is headed as soon as possible.
This removes doubt, weeds out the naysayers and allows the business to focus on the outcomes that drove the mergers or acquisitions in the first place.