Brand strategy is a fundamental part of corporate strategy and constitutes a key condition for companies operating in international B2B contexts, to effectively manage relations with customers, stakeholders and shareholders. Mergers and acquisitions (M&As) are drivers of change in both brand architecture and brand portfolio strategies pursued by B2B companies.
The latest port study of PortEconomics members Theo Notteboom, Giovanni Satta and Francesco Parola, aims at investigating brand architecture and brand portfolio management strategies in the B2B domain, by focusing on branding decisions of container shipping lines in the context of M&As. A taxonomy of branding options available to B2B companies is presented and empirically applied to the container shipping industry, which has undergone several waves of M&A activities in recent decades. The brand strategies of some of the most M&A active players in the industry (i.e. Maersk Line, Hapag-Lloyd and CMA CGM) are examined, with a particular focus on the corporate visual identify (i.e. the name and visual devices such as logo, typeface and colour) adopted after an M&A transaction.
The empirical dataset on M&As in container shipping includes the names of the acquirer and acquired company or merging entities; the geographical scale of the shipping networks of acquirer and acquired; the type of transaction; the year of the formal completion of the M&A; the adopted corporate visual identity after the M&A; and the financials of the M&A transaction. Moreover, the authors propose a conceptualization of the factors, drivers and impediments that shape ocean carriers’ attitude towards the different branding options and strategies. The results demonstrate that two strategies are dominant: the new entity adopts the visual identity and name of the acquirer (‘backing the stronger horse’) and the lead and target brands continue to exist independently after the M&A activity (‘business as usual’ often as part of a broader multi-brand strategy). These two strategies and the hybrid option, combining these strategies, represent 78% of the M&A cases. The remaining M&A cases strongly relied on hybrid strategies involving a change in the adopted strategy many months or even years after the M&A. The decisions of shipping lines regarding branding in an M&A context are influenced by a complex set of interacting drivers and factors which can differ from one case to another and can change over time.
The study contributes to extant literature by showing a more comprehensive typology of possible brand strategies, by providing an empirical analysis in a B2B environment and by presenting a novel conceptualization of the factors affecting brand strategy in an M&A context.
The authors’ version of the study that has been published at the scientific journal Maritime Economics and Logistics can be freely downloaded here.
