Collectively, clients of Contrast & Co. have enjoyed over $2B in disclosed acquisition valuation over the years. So, why is branding important when considering a future merger or acquisition? We're glad you asked.

What Happens During the M&A Process

During a business acquisition, there is always a period of due diligence. During this process, chief executive officers and leadership teams are confronted with countless decisions and challenges.

That comprehensive checklist includes countless operational issues pertaining to cost rationalization and the integration of finance, tax, HR, and IT functions. In addition, the acquiring company thoroughly examines the target company's books and financials. Additionally, this process often includes interviews with leadership and boards.

What Can Go Wrong?

In a word, lots. Misunderstandings between parties around either the tangibles or intangibles can create barriers and challenges throughout any merger. Most often though, those are related to the inability to clearly and consistently articulate value, vision, and opportunities, which can lead to tension, frustration, and ultimately abandonment of the entire deal.

In fact, failure to address those intangibles—specifically the overall brand strategy—up front is all too common.

According to an MIT study, “In many cases, the corporate brand strategy receives serious attention only after a deal is approved or the merger is announced. But by then, it may be too late, especially if employee morale, customer satisfaction, and the new entity’s share price have already plunged,” said the study.

The study reveals that due diligence processes are great at evaluating tangibles, like property. But evaluating brand and goodwill is another story. 

So, Why Undergo a Brand Strategy Initiative?

Great question. The success of a business acquisition depends on many factors. Having a strong brand that is supported by a strong strategy can help make the transition smoother for both parties involved and ensure that the newly acquired business continues to achieve success.

A well-crafted brand strategy helps to define the differentiating factors between you and other competitors in the same space. It also develops trust with potential partners, clearly outlines why they should invest in your organization, and establishes a long-term relationship.

Good branding also helps to ensure that a company’s value is accurately captured during the due diligence process. In addition, a good brand can help acquirers quickly understand and assess potential synergies between two merging organizations.

What if you could come to the acquisition table with a compelling story of the intangibles that make your business unique? In our experience, establishing brand value in preparation for a merger helps bring to light and optimize everything from differentiators in the market to a unification of the team. Not only does it reinforce the tangible value of the organization; it solidifies the company’s story and how to tell it. Arriving with a fully formed defining idea and reinforcing manifesto solidifies not only your external but internal position with the acquiring company. And in a potentially turbulent time, a foundational brand can reduce employee and customer uncertainty and turnover during the process.

Ultimately, a comprehensive and well-executed brand strategy will make your company more attractive to potential buyers, help you effectively communicate your differentiating factors from competitors, and guarantee that the value of your company is accurately captured during the acquisition process. Contrast & Co. can work with you at any stage in the process to develop a brand strategy that is tailored to your unique needs. Our team of experts will help you position your brand for success and maximize the value of any potential merger or acquisition opportunity.

We look forward to helping you create the foundation for a successful future M&A initiative. Get in touch to learn more about how we can help. Let's create something unique together.