Posted Notes

The financial brains behind the deal need to look far beyond the figures and perhaps at a number of pervious mergers that looked good on paper but were poor in practice. Previous international brand marriages have failed, for example Daimler Benz and Chrysler, where the differences between US and German culture were similarly underestimated. 

A key decision that the parties involved would need to consider at the consumer level is which brand is actually stronger and which name to use or drop? Hard questions need to be asked about which brand can deliver the greatest value in all markets considered. 

There should also be concerns about how the deal is going to play out on the shelf. At a cosmetic level, will we see a hybrid logo of the two brands as Kraft attempts to be all things to all buyers and appease the tastes of its very different audiences? Or will the merger be purely at the corporate level, leaving the brand architecture untouched. I doubt the British public would react favourably to changes to the packs of their beloved chocolate bars to reflect the new status quo. 

And while the tax man concerns himself with high net worth British executives seeking tax havens abroad, has anyone considered the national implications of moving a British industry staple across the pond, nevermind the national psyche? 

When it comes to the crunch, egos must be left at the boardroom door, otherwise all stakeholders involved will suffer financially.

To help make these decisions properly, a thorough brand audit must be carried out, which is as important for internal as external communications. M&A activity inevitably has a huge impact on employee engagement. It’s all too easy to worry about the shareholders, rather than the thousands of people that will inevitably fear for their jobs.

 Terry Tyrrell – worldwide chairman, The Brand Union

terry.tyrrell@thebrandunion.com

This entry was posted on Wednesday, January 20th, 2010 at 12:08 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.