In the midst of negotiations for a major merger or acquisition, the logistics and implications of a rebrand never top the list of senior executive concerns.
Providing the relationship with the target company makes sense from a commercial and strategic perspective, does it matter what its name is?
Indeed, with a host of major mergers, acquisitions and joint ventures deals happening across the renewable energy sector, most firms seem to have handled the challenge of rebranding in a fairly ‘no nonsense’ manner.
Ever since the consolidation in the wind energy supply chain transpired, Nordex Acciona, Siemens Gamesa and the MHI Vestas JV have provided three prominent examples of a simple ‘best of both’ rebranding strategy. This approach plays on the reputation of both existing companies – and their respective track records.
But what options are open to marketing teams seeking to look beyond the smashing together of two constituent parts? How can a rebrand be communicated in such a way that it satisfies everyone? And how can all of this be undertaken while maintaining the confidence and trust of the market?
4 rebranding strategies to consider
In their article Merging the Brands and Branding the Merger, Richard Ettenson and Jonathan Knowles provide a very good and often-cited overview of the various branding strategies that can be adopted following a merger. So, without attempting to reinvent the wheel, their four main categories of rebrand are set out as follows:
1. Backing the stronger horse
Adopt whichever existing brand is perceived to be the strongest, either immediately or after a period of combined branding.
Advantages: A relatively simple strategy to implement in practice, with no ambiguity. If managed and communicated well, clients and employees of the subsumed entity may feel that they are taking a step up, in the level of service that they are receiving, or in their careers, respectively.
Disadvantages: If poorly managed, sends a message, both to clients and employees that the merger has a winner and a loser, potentially damaging internal morale and the strength of client relationships. Does little to maintain the value tied to the track record of the acquired firm in the wider market and can give the impression that it has simply ‘disappeared’.
2. Best of both
Combining the corporate identities of both companies, either fully or in part.
Advantages: Conveys equality and a shared future for both companies that will see the status quo for clients remain largely the same. Reassuring to investors and employees.
Disadvantages: May risk creating an identity crisis. Without a truly shared brand identity, an internal divide may persist, and the impression of two distinct companies operating under one roof. Externally, this may lead to brand dilution and confusion.
3. Different in kind
Creating a completely new identity for the combined organisation.
Advantages: A bold and exciting move that signals a new vision and direction, and that the new integrated entity is fundamentally greater than the sum of its parts.
Disadvantages: The most resource-intensive and risky strategy of all. Can only be realised with the complete buy-in of executives throughout the organisation, and creates heightened expectations within the client base. Risks losing the heritage and equity tied to both existing brands.
4. Business as usual
Both brands continue to exist separately as before, with the acquired business operating as an autonomous unit
Advantages: Leaves both customers and employees unaffected; limited branding implications or disruption to the status quo. Retains the value connected to both distinct brands.
Disadvantages: No additional brand value realised via the connection between the two firms.
4 questions to answer before a rebrand
Each of these strategies brings opportunities and risks, and while some of the above are more commonly adopted than others, none guarantees success.
When it comes to communicating a rebrand, the key is to thoroughly understand existing perceptions of both businesses internally and in the wider market, and be transparent in telling these audiences why and how things will change.
With that in mind, it’s a good idea to ensure you have a strong answer ready for each of the following questions, before tackling a rebrand.
1. Who are you?
Define yourself as clearly as possible from the outset. Put in the hours to determine whether the identity of your new combined business is the same or fundamentally different from before.
Communicate how any change in identity will manifest itself throughout the company, from the board level to your client-facing teams. Do this both internally and externally, to ensure that your team is fully briefed on how changes will affect everyday business and communicate this to clients and prospects before announcing the rebrand publicly.
2. Why do you do what you do?
Don’t forget about the heritage and reputation of both brands. This is critical to your clients’ understanding of the ethos and fundamental motivation of your business.
Consider why people bought into both organisations in the first place. Is it for the same reasons or for different reasons? Will those reasons still exist once you’ve rebranded? It may be easy to lose sight of the ‘why’ when you’re focusing on the exciting new capabilities of the combined organisation.
3. How will things change?
As much as heritage and reputation is important, don’t rely on it too much. Although your customer base expects you to keep delivering as before, they also expect change – otherwise, what was the point of the rebrand?
Clearly communicate how things will be different, rather than focusing too heavily on reassuring your clients that they can expect ‘the same high level of service’. Overegging this may just create suspicion.
4.What are you doing to back it up?
Ultimately, your new brand identity will be built on actions as well as words. The reputation of the new brand won’t be forged overnight, and starting to communicate what you’re doing as well as why and how is essential in creating this evidence base.
That’s why, once the merger itself has been communicated, your first joint project announcement is so important. A strong deal win story gets the media campaign off to a great start and is essential when it comes to substantiating the promises made during the rebrand and building trust in the market, amongst existing clients and new prospects.