Much consolidation has happened in the semiconductor industry over the last decade or so. And it’s not over yet if recent news is anything to go by. By consolidation, I’m referring to specific mergers and acquisitions (M&As) between companies making similar products, materials, or devices. It’s happened in the materials space, the memory space, the equipment space—in a wide variety of areas—and up and down the supply chain. More recently, we see it happening with major chip manufacturers as well. Why? Because an M&A can provide real value, over time, to the new entity that is formed as a result. It can help companies gain market share and realize efficiency gains by cost-cutting after the deal. It’s a very viable and long-accepted practice. But it can drive brand professionals crazy.
Did you catch that? No not the “crazy” part. The “new entity” part.
I want to make the point that an M&A can be transformational. They can actually change “who” the acquiring company “is” and what it provides. In other words, it can change the company’s identity, as well as its value proposition. Yet that new identity is seldom expressed. That’s what leads to the “crazy” part. Here’s what I mean.
Once companies merge, they form a new entity. Whether they realize it or not, they can fundamentally change from the company they were. Often, they’ll unite and present themselves to the world under a new name, new brand, new identity. And that’s perfectly acceptable. The “crazy” part is when they decide to continue under the current name and brand of one of the entities, and just “absorb” the other company into their existing brand, with no thought whatsoever about how their brand should change.
If, as a marketing professional, you find yourself in this situation, you just must bring some thinking to it. Very simply, if Brand A merges with Brand B (or acquires Brand B), and they each do eight things, but they have only two of those things in common, then Brand A used to do eight things, but now does six additional things that it didn’t do before. Its current brand wasn’t built around the now-14 things it does and provides. The company has changed. The brand needs to evolve with the company. Even if a company grows organically, its brand should always keep up and stay current.
What gets maddening is when company leadership doesn’t think about or understand the impact of M&A on its brand. They should. Suddenly they’re looking and acting like a company that does eight things but talking like a company that does 14 things. There’s a disconnect between the brand’s identity and its value proposition—the two main areas that make up the core of the brand itself. So, the brand needs to express the change it just went through—the growth it just had—to better express “who” it is today and what it is becoming. The degree to which it should change can vary greatly, depending on the situation. Sure, they don’t need to consider brand change with every acquisition, especially during a string of acquisitions. But ultimately, the brand, and its vision, should come into alignment with the company’s business vision.
An M&A Rebrand Case Study
I remember when I was working in corporate communications for a materials company. I was responsible for brand development, branding, marketing communications, and public relations. We were acquired (or “merged with”) a slightly larger company working in materials handling and delivery systems. The company I worked for was folded into the acquiring business and came under its brand. My new boss and I traveled to give each other a tour of our respective company headquarters. As we drove from one to the other, getting to know each other, I asked a question.
“You just took on our company—about two-thirds the size of your company—which makes different, but complementary, products. How will this large change affect your brand? What changes are planned?” I asked.
“What do you mean?” she responded. “Like, are we going to change the logo, you mean?”
“Not necessarily,” I offered. “You’re a different company now. I’m wondering if there are plans to reevaluate the foundation of the brand to better map to what the company has just become. But sure, I suppose that work could eventually suggest a change or tweak to the identity, including the logo.”
She got quiet. Then she got mad and said, “They only brought me into this three days before the announcement. I’m tasked with rebranding all your marketing tools and consolidating our websites. I never even considered brand, but then, there wasn’t a lot of time to have those discussions. I wish they would have brought me in a lot sooner.”
We started with corporate messaging. We discovered the best way to talk about and position the new company. We planned to use the website redesign to consider a look that better reflected who the company was becoming.
I had done this for my employer previously. I rebranded the company. It had looked like an engineering company from way back in the ’70s or ’80s. After defining the brand, I launched a global rebranding of the company (logo, design, messaging) to look and sound like the company it now was—more advanced, more modern, nimble and uniquely its own. It supported the business well. We sold the company to what became my new employer several years later at a premium price.
My new boss and I lobbied for a new look for the website, permission to revisit the logo and to deliver a new brand look. To do this, we tweaked the underpinnings of the brand strategy and built from there. It, too, rolled out globally. We delivered a new-ish logo, a newly designed look across the board, new messaging¬—all buoyed by new positioning that it could now uniquely own—because it needed to happen. It went over well. The company’s new image was well-suited, and the company grew into it. I have no doubt it helped deliver value (equity) for the company, and it mapped well with “who” the company had become. It had a new mission, and a new brand to match it.
My point is, brand matters. It’s a big part of expressing any new or newly formed company and wraps a meaningful and strategic identity and purpose around it. Yet it’s often forgotten or overlooked by executives and marketing professionals in M&A activity. And that’s what drives me crazy.
Get in touch with our team to find out more about rebranding after a merger.