Why Customer Experience is key to the successful M&A?

Customer Experience

Why is Customer experience important in M&A?

When two companies come together in a M&A transaction, it means two sets of customer experience and employee experience need to coexist and this requires both sides to adapt in some way. Companies involved in tech acquisitions gain access to skilled talent, technology, new market or a new customer base.The M&A integration plays an important role in order to bring in the new business effectively. The number one priority for the integration team post acquisition is to protect the base business by taking care of the target company’s customers and then growing the existing business.The integration office needs to ensure that the target company’s employees continue to remain focused on serving their existing customer base.
Often the customers and employees of the target organization are stuck post acquisition as the employees of the target organization may have to learn new systems and target organization’s customers need to engage with new people.

How to improve Customer experience in M&A?

  • Customers hate change, hence acquirer needs to carefully approach the post acquisition situation especially when revenues synergies form the important basis for the deal rationale.
  • First, the integration team needs to communicate to both the sides of the customers immediately after the deal is announced.
  • The customers of the acquired company needs to be communicated quickly on the latest updates to comfort them that there will not be any disruption to the services offered to them.The customers need to be told about the positive benefits of the deal and additional investments would be done by the acquirer to further improve the existing services offered.
  • There needs to be a concerted effort to keep customers aligned with the same account managers so that the human relationship stays intact.

Customer experience strategy 1 – Retaining Target GTM Team

  • It is necessary for the acquirer to retain the target organization’s sales team in order to ensure continuity of all existing sales relationships.The sales team provide local presence on the ground and the deep relationships they have built with many of the customers will add value.
  • For integration to be seamless, it is necessary to retain the existing sales structure, reach out to customers immediately to communicate why the deal took place and share the overall vision of the company.This will ensure seamless transition and also maximize new opportunities.

Customer experience strategy 2 -Branding

  • The branding has to be carefully thought through and decided at what point the target company’s brand will be discarded.
  • This decision should take into account the reputation of the acquired brand with existing customers and in specific regions they are operating.
  • In new markets, the branding would change as the target organization do not have any presence.

Customer experience strategy 3 -Target Screening

  • Customer experience is an important consideration when assessing the potential target company and understanding the fit with the overall strategy.
  • In acquisitions involving the addition of new business line and a set of new customers, there needs to be more emphasis around customer experience and maintaining that continuity.
  • The integration strategy needs to consider that customers and customer experience is not disrupted post acquisition.The integration team needs to take care of the existing customers, continue to give the highest priority to them to ensure that there is continuity and then focus on growing their business.
  • The acquirer needs to be very careful in their integration approach in how they place demands on the incoming team to ensure that they continue to serve their existing customers.
  • When acquirers buy companies for technology expertise, they need to leverage their technology expertise to launch a comprehensive solution.It is critical that the final solution has the right proof points with the right number of happy customers and the right growth project trajectory in order to deliver good experience.

Customer experience strategy 4 -Culture

  • Culture is very important when integrating companies as the right culture needs to be instilled to deliver synergies.
  • The acquirer’s executive team need to meet the target company’s employees on Day1.
  • A proper employee engagement program needs to be run for the new employees for onboarding. The target company’s employees should be considered as new employees to the overall organization and should be introduced to the full organization to provide a better customer experience.

Final Takeaway

The M&A integration needs to focus on the customer experience because the top priority for the acquirer post acquisition is to protect the acquired company’s base business by taking care of their existing customers and then focus on growing the existing business.

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