With M&A volume setting new records—over $5 trillion in deals in 2015, according to Dealogic—many branding, marketing, and communications professionals will be charged with implementing a rebranding project during their careers. Executives often ask me what the key is to setting up for success of a rebranding implementation. My answer is straightforward: Explore rebranding implications as soon as regulatory oversight and review of the deal begin.
Questions to ask before implementing your new brand
Among the questions you should ask: How will the company finance the transition to minimize operational impact and enhance shareholder value? Will the new entity take the acquiring company’s brand? A merged company’s brand? To avoid last-minute scrambling, get the issues on the table early. If confidentiality is required, consider safeguards on proprietary information.
At the time of the deal announcement, begin identifying timing triggers that affect the new brand’s launch and rollout dates. Heed regulatory requirements, deal constraints, or business realities, such as fiscal year dates, product launches, or the business cycle. Identify interdependencies and develop a plan to deploy the right resources at the right time. During the Hewlett-Packard split, we worked with marketing to identify 20 high-visibility locations to re-sign to mark Hewlett Packard Enterprise’s formal launch.
If a new brand is required, create a team to identify a branding agency to create the new brand strategy and logo. You also need to determine how you will manage the logistics of the transition. The agency will create the new identity, but how will you develop rollout scenarios and quantify the timing and cost implications of different options? These issues should be considered right from the start to ensure that you are ready with a properly considered and vetted plan to present to the leadership team and/or the board of directors once approval is received.
In order to develop scenarios, information will have to be gathered on the scope and cost to transition branded assets (i.e. any item that carried the brand.) When two companies are merging, the goal of the data-collection process is to create a combined list of all such assets, including those that should be (1) eliminated, (2) rebranded, or (3) neutralized (logos or identity removed). This is a big task, but remains the foundation of a successful rebranding implementation, assuring the rebranding launches with correct cost, scope, and time estimates.
The data collected underpins the creation and examination of various scenarios for brand implementation. At BrandActive, we seek three scenarios that best serve the new company from the standpoint of cost, speed, scope, quality (good, better, best), and sequencing of the rebranding for each asset or class of assets. Quality is the overriding variable, and typically guides BrandActive in constructing each scenario, each with a different price tag.
This is a time when BrandActive often works with the CFO and his or her office to identify the sources of funds for rebranding. Some clients prefer to classify costs as extraordinary, one-time expenses; others prefer classifying them as operational, so they appear in the P&L. The analysis we present includes a cost estimate broken down by asset category, fiscal year split, allocation of spending to either the capital or operating account (CapEx or OpEx), and where needed, legal entity allocation. The chosen scenario then triggers the development of detailed project and communication plans for every asset category, taking into account risks, budget control, and quick wins that will align all workgroups.
A smooth brand implementation requires fluid cooperation between the integration management office, marketing, and operations. At Hewlett-Packard, we worked with 30 departments, including the Separation Management Office (SMO) and Global Real Estate group. Both units were part of a larger team to navigate the complexities of signage and other changes in a host of corporate locations. Anticipate internal rumblings and be ready with a carefully crafted message to send to directors as soon as legally possible.
As soon as the deal is approved, be prepared to outline key transition players and ask for people’s commitment to do what’s possible to minimize transition costs and speed implementation. Let this communication cascade through the organization while asking managers to seek cooperation from the entire company to make a priority of finishing rebranding-implementation tasks. At Verizon, when BrandActive was engaged in the company’s recent rebranding, the communications extended not just to the organization, but to direct retail, indirect retail, national retail (Wal-Mart, BestBuy, etc.). Everyone worked to validate rebrand plans and budget estimates.
The most thorough preparation, of course, needs to be followed with an excellent plan for execution that addresses all the complexities and costs of implementation. There are thousands of tasks and numerous vendors to manage, as well as the need to monitor progress and spend, escalate issues, and communicate effectively to all stakeholder groups. If the upfront work has been thoroughly done, you will have set yourself up for a transition that will go without regrets and cost spikes, resulting from insufficient preparation. Ready, set, go!