Rebranding in A Merger or Acquisition

In our continuing series of reasons to rebrand, we take a look at those times when you need to fly a new corporate flag in a merger or acquisition.

Mergers and acquisitions account for approximately half of all rebranding initiatives carried out across the nation each year, and for good reason. When two companies merge, regardless of whether they had well-established and distinct brands previously, critical decisions must be made. Determining which brand to retain or whether to create an entirely new brand is a pivotal choice.

Options When Rebranding in a Merger of Acquisition

As the leaders of the merged entity outline their strategic vision, they must also chart the course for their brand's evolution. Here are several options to contemplate:

Maintain the Current Legacy Brand Name and Architecture: While this approach may somewhat undermine the potential cost-saving advantages associated with the merger, it becomes relevant when both merged organizations boast strong brand equity and passionate customer bases that warrant minimal disruption. Additionally, if an acquisition is executed by a large corporate player following a "house of brands" structure—think P&G or Unilever—the acquired brand can remain independent, preserving its name and positioning.
Merge Strong Brands: When both brand names hold substantial value, merging them is a viable strategy. An exemplar of this is the merger between oil companies Exxon and Mobil, resulting in the coexistence of both brands under ExxonMobil. Similarly, Disney's acquisition of Pixar demonstrated the retention of both brands by prefixing "Disney" to "Pixar" in all branding applications.
Unify Behind One Brand: Opting to rally behind the brand name that research indicates possesses the strongest equities, customer recognition, potential, value, and positive industry reputation is a common approach. Typically, the acquiring brand assumes this role, but occasionally, the acquired brand prevails, such as the case when AlliedSignal acquired the more widely recognized Honeywell.
Introduce a New Parent Corporate Brand Name with Separate Legacy Brands: This method involves crafting a new corporate brand name while retaining the individual brand names of the legacy companies. These entities are positioned as "A New Brand Company" under the umbrella of the parent name. When Guinness and Grand Metropolitan merged, they birthed the corporate identity Diageo while preserving most product and sub-brand names. Although this approach requires greater investment to establish relevance and significance behind the new corporate name, it pays dividends when future acquisitions are part of the strategic plan.
Establish a New Corporate Structure and Brand Name: In this scenario, the legacy brand names are relinquished as the corporate name takes precedence during the integration of teams and operations. A case in point is the merger of SunTrust Bank and BB&T financial institutions, resulting in the adoption of the new moniker, Truist Bank.
Craft an "Elastic" Brand: This strategy is advantageous when further acquisitions are on the horizon to expand the product portfolio within a shared customer space. It involves selecting a less descriptive brand name that emphasizes the broad benefits of partnering with the company. For instance, merging three linen providers in the hospitality sector led to the creation of the umbrella brand 1Concier, simplifying the addition of new industry providers under a strong service-oriented brand.

Effective Execution Eases Merger Concerns

Rebranding amid an acquisition poses challenges, especially when doubt prevails. Employees fret about the company's future trajectory and are more preoccupied with losing their legacy standing than embracing the potential of the new entity. Customers question if cost-saving measures will affect their preferred products or the rapport established with sales representatives. Competitors linger, ready to spotlight alterations within the new organization that could entice customers to switch providers. These circumstances demand a meticulously planned rebrand, complete with strategically orchestrated communication and persuasive brand messaging that hastens relationship-building.

Rebranding Transcends a Mere Name Change

The process of rebranding demands a broader perspective than a simple alteration of name, particularly when it underpins the merger of multiple entities, along with other profit-generating strategies.

In every rebranding endeavor, the objective remains to establish a brand that thrives in the market, imbued with significance, conveying the merged company's narrative to both customers and prospects. Ideally, rebranding becomes the catalyst and adhesive that propels integration efforts. The new brand should resonate throughout your go-to-market strategy, presenting the merged entity as a unified force, thereby ensuring consistency in market presence and obviating the need to micromanage multiple brands.

Above all, a new brand possesses the potential to unify the employee base, furnishing an inspiring employer brand platform characterized by purpose, culture, performance, and a compelling recruiting message.

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