M & A: To Combine Brands or Not, That Is the Question
Brand awareness is certainly not a topic to be taken lightly, especially during the acquisition of another company or brand. Should you operate that brand as a separate entity or incorporate it into your brand? Victor Hunter, founder and president of catalog consultancy Hunter Business Solutions, offers his thoughts on delivering the brand promise after an acquisition.
Once you acquire another company, Hunter recommends asking whether each brand delivers on a different promise before deciding whether to merge the brands into a singular entity. “If two companies have grown and flourished in the same market with the same type of customers, I’d think they aren’t making the same promise,” he says. “So to combine those two would be a lost opportunity in the market.”
When evaluating each brand’s promise, Hunter suggests asking customers why they shop from one brand and not the other. One brand may operate as the low-price leader, while the other may offer newer products more often. These differences are the unique selling proposition for each brand. If these are dramatically diffrerent unique propositions, then the two brands probably should operate distinct from one another, he says. This provides you with a dual-position in the marketplace. If the unique selling proposions are largely the same, Hunter notes, then you have an opportunity to join forces under one brand.