There are many pieces to the puzzle – people, IP, fiscal strength – but few realise the role of marketing and PR in helping companies to exit.
It all starts with transparent goal-setting. Many executive teams avoid unsettling their workforce by outlining ‘exit’ as a corporate goal. But that stops their own senior PR and marketing people appreciating the true objective of their own campaigns.
Why does this matter? Because a PR campaign with a specific goal of attracting acquirers is subtly, but importantly, different from one focusing on sales lead generation or improving brand awareness. For starters, the content and channels used need to mirror the ways in which potential acquirers identify and investigate target companies.
Some of the most consistent information sources include:
Media coverage, publicly available research, specialist blogs, trade associations and conference proceedings are all key information resources for researching acquisition targets. Which makes them vital targets in campaign planning.
Analysts and consultants
It is not widely appreciated, but industry analysts and consultants do a lot of acquisition longlisting, targeting and due diligence work for those on the acquisition trail; and
Networks and networking
Acquirers will often use their own informal networks, including specific networking events, to research targets and gather advice. This makes strong brand awareness efforts all the more important.
So if these are the routes to focus on, what messages must be put forward? There are certain company assets that heavily impact valuation, and which need to be highlighted and showcased through marketing efforts.
Whatever the acquisition’s drivers, the vision of the target company is critical. A company’s vision drives the direction of the business, the types of customers it has, the development of its products. Communicating it clearly therefore demonstrates that a company is a good long term bet, worthy of close attention.
How well are a target company’s technologies, products or processes protected from competitive forces? Does a company have a sustainable core competence or a transitory competitive advantage?
Experienced leadership team
Acquirers will often be drawn to companies with a well-credentialed leadership team that can be trusted and respected. Showcasing your executives’ track records in innovation, disruptive propositions or strong delivery will always inspire confidence.
Robust sales pipeline
Showing potential acquirers the substance behind the vision and the market interest in the product or service is an essential part of attracting interest.
Strong marketing function
Proactive outbound marketing activity shows that the company is serious about lead generation, revenue and profile and has effective mechanisms in place. Frankly, if marketing is going well, it will take less time for investors to start seeing a return.
Finally, how does a marketing team best articulate and emphasise these assets to acquisition audiences?
In order to best demonstrate your important assets, the manner in which you describe yourself must tell the right story. Does it illustrate your vision and strength, or the headway you have made in your market? Is it concise, comprehensible and supported by proof points? Does it strike a balance between genuine market differentiation and dangerous over-hype?
Have a strong vision for your market
Do you have a new view on the market? Have you researched an aspect of the market that needs to be understood better? You could be a unique company with powerful messaging, but if you have nothing different to say, you have no way of attracting and holding attention.
Recognition and credibility
Journalists and analysts are important third party endorsers for acquirers, making press coverage and analyst mentions vital. Also, seek out award schemes to enter, and conferences for your senior team to speak at. And remember, too few companies showcase their momentum by collating this industry attention in a single place on their websites.
Consistency and variety
Investors have seen hundreds of companies purporting to be “the next big thing”, and many have disappeared with promises left unfulfilled. So when a company appears throughout industry media, in every analyst report and on every podium available, but then goes quiet, investors will suspect the worst. The silence may in fact be perfectly justified, but a perception of being unstable sticks.
A PR and marketing campaign is a vital part of any plan to be acquired. As was said at the outset, those companies who are successfully spotted and bought are rarely found by accident. They have in fact put in some hard work to appear in the right places, saying the right things.
Richard Fogg is Managing Director of CCgroup.
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