February 24, 2009
As the economy struggles, opportunities for strategic acquisition increase. Stronger companies merge with weaker competitors to gain market share. We spoke with three experts about the most effective ways to merge brands.
Find out how to address merger issues, such as:
- Selecting which brand assets to keep and which to jettison
- Implementing internal and external messaging about the merger
- Refining the visual identity of the new brand
Whenever a merger or acquisition occurs, there are internal and external components.
The internal component requires reorganizing staff, communicating new service offerings or direction, asking for feedback, getting everyone to move in a new direction.
The external component involves creating the new visual identity (e.g., logos, signage, etc.) and communicating new service features, products and policies to the public.
When FedEx acquired Kinko’s in 2004, FedEx had quite a few decisions to make about how to proceed. Gayle Christensen, Director Global Brand Management, FedEx, and her team had to explain the merger to FedEx and Kinko’s customers. They had to decide whether the customers would understand the new brand if they dropped Kinko’s name.
After careful consideration, they chose FedEx Kinko’s as the new brand name. Last year, they ditched the Kinko’s name altogether, changing it to FedEx Office.
Find out how Christensen’s team and brand experts from a strategic communications firm advise merging brands in a meaningful way to gain market share.
Merging Brands: 8 Steps
->Step #1. Establish a transition team
The team is responsible for:
o creating messaging about the merger
o disseminating messaging to internal staff
o disseminating massaging to customers
o disseminating messaging to the media
o creating/implementing a visual identity for the new brand or merger
These things can’t wait for the merger to be finalized, says Eric Norman, Strategist at Sametz Blackstone Associates, a strategic communications firm.
Social media allows news of a merger to reach the public sphere before PR or marketing teams can create and communicate a unified message. “You can’t act too soon,” he says.
->Step #2. Gather qualitative and quantitative research
As soon as Christensen’s team got word of the Kinko’s acquisition they launched extensive qualitative and quantitative research to help them understand the equity of the two brands and figure out whether customers could see them together.
Quantitative research can include existing research, says brand expert Roger Sametz, President and Founder of Sametz Blackstone Associates. Sometimes, it involves commissioning a telephone or a Web survey.
Sametz suggests using online surveys, for example, to determine which value propositions resonate most strongly with customers. “You’re trying to hang on to the stuff that’s of value,” Sametz says. “You’re trying to get rid of baggage or perceptions that don’t connect.”
Qualitative research involves interviews with salespeople, product managers, customer service representatives, and customers. The gathered information often leads to decisions about which attributes of one brand or another should be carried forward and which should be discarded.
FedEx, for example, kept Kinko’s in the new brand name because that’s what the research suggested. “We ended up finding out what worked best was keeping both company names, so that the Kinko’s customers wouldn’t be confused, and the FedEx customers wouldn’t be confused,” Christensen says.
->Step #3. Decide what brand assets to keep or discard
In deciding which brand assets to keep from company “A” and company “B,” consider not only the results of the quantitative and qualitative research, but also competitors in the marketplace.
There may be brand assets in your industry that competitors “own.” “You don’t want to hang on to something … that is already very much owned by a competitor,” Sametz says.
->Step #4. Develop messaging about the merger
Keeping the message simple and consistent helps keep those who speak to the public, both formally and informally, on the same page. Once the transition team has an idea of what the new brand or changes to the existing brands will be, they can hone the story of the merger into simple, consistent messaging.
Note: Don’t wait until the particulars of new brand or direction of the company are concrete to start creating the message.
“It might take weeks or months to figure out what the story is about the merger,” Sametz says. “But no one is waiting weeks or months to start talking about it.”
->Step #5. Train staff on the message
Any employee that speaks to the public should be trained on messaging.
If people aren’t trained on messaging, or if they don’t feel in the loop, they might say: “I don’t know. No one tells me anything,” when a customer asks about the merger. A response like that hurts the brand.
Some ways to train staff:
o hijack staff meetings for a few moments to talk about merger messaging
o conduct role-playing sessions, especially with sales and customer-service teams
o distribute memos about messaging to department heads, let them communicate to staff
o provide an online resource page on the company’s intranet, along with scripts
o use email to disseminate messaging
->Step #6. Set up interviews with bloggers
High-profile people (e.g., new chief executives) should do interviews with bloggers, trade publications, and other media outlets to address weak speculations and preclude skepticism, says Norman. “You have to engage folks who are writing about you,” he says. “If you are not engaged, you concede the control of the message to them.”
Find out who’s talking about the merger on social media outlets, including Facebook, LinkedIn, Twitter, or niche online forums and blogs. Search for the merging companies’ names or set up an email alert, such as Google Alerts, for the company and brand names.
Make a point to comment on blogs or social media sites talking about the merger, especially if something is false.
Note: FedEx has not commented on speculation about any of their mergers in interviews with bloggers or other media outlets because they are a publically traded company. The company is starting to engage the blogger community on their citizen blog, launched last year.
->Step #7. Implement a visual identity
In designing a new visual identity, consider how the two companies or organizations express themselves, says Sametz. Ideally, those expressions match in some way, such as a similar color in both logos. If the merging companies hope to keep some element of both brands, creating a new visual identity that incorporates a shared color scheme achieves that.
FedEx uses a color-coding system to convey their portfolio of different, but related businesses. For example, when FedEx acquired Caliber Systems Inc. in 1998, the company decided to turn Caliber Systems’ brands into new brands.
RPS became FedEx Ground, Viking Freight became FedEx Freight, and Roberts Express became FedEx Custom Critical. Christensen’s team color-coded the new brand names by keeping “Fed” purple and changing the color of “Ex” based on the different capabilities.
o FedEx Ground – purple and green
o FedEx Freight – purple and red
o FedEx Custom Critical – purple and blue
Keeping purple as the base color keeps each logo consistent with the FedEx brand, says Christensen. Changing the “Ex” to a different color communicates that it is a different capability within the brand.
->Step #8. Continually reassess the strategy
Marketers and brand managers need to continually reassess their strategy and adjust to new opportunities, says Norman, because change is inevitable.
For FedEx Kinko’s, change came when the brand started offering direct mail, video conferencing, and wireless access, Christensen says.
“As we started developing more sophisticated services that were much deeper and broader than what had been available at Kinko’s, that’s when we decided, okay, it’s time,” she says. “That’s why we went to FedEx Office. It’s been an evolution.”
Useful links related to this article
Creative samples from FedEx:
Landor Associates – firm that worked on FedEx’s brand strategy and logo design:
Sametz Blackstone Associates: