Protecting Your M&A Investment with Smart Communications

By Pamela Reich

If your bank’s expansion and growth strategy includes M&A, you are undoubtedly evaluating a number of opportunities, based on many considerations.

First and foremost, the deal has to make sense financially—to the shareholders, the board and other stakeholders. Whether you’re paying a premium for a bank’s assets or rescuing a poorly performing institution, whether in-market or an extension of your footprint, M&A represents a major investment that must support your bank’s long-term revenue growth goals.

That said, once you’ve arrived at a mutually favorable purchase/merger agreement, you’ll need to begin thinking about how you can best optimize your investment through carefully planned and executed customer and employee communications. You’ll want to leverage required regulatory communications to create positive customer experiences and marketing opportunities. Here are six key strategies that will protect your M&A investment:

1. Get started early. Set up your internal teams, establish processes and plan out the timing of key merger events. Despite the current uncertainties in obtaining regulatory approvals, you need to have a plan, even if the plan must change. The integration effort is wide-reaching, and it’s critical to involve your internal stakeholders—including executive management, operations, IT, legal, compliance, product, brand and marketing—with regularly scheduled meetings to address issues and keep everyone informed.

2. Identify the major customer impacts to build an overarching messaging strategy. Evaluate the big picture opportunities afforded by a larger organization, such as enhanced digital offerings, greater lending resources, more branches and a broader product suite. Don’t overlook potential takeaways, including branch consolidations, higher fees and perceived loss of personal service. When planning communications, it’s important not to overpromise—to attain the trust of your newly acquired customers and set the stage for future relationship-building, you need to be believable.

3. Plan a well-orchestrated stream of communications throughout the integration process. From the initial welcome letters to the detailed change information, the timing of merger events will drive a smart communications plan. Carefully balance the need to keep customers informed without overwhelming them, as they are establishing a connection with their new bank.

4. Build unique solutions for each set of circumstances. One size does not fit all, so you should be developing different communication approaches for different customer segments as appropriate, based on the type of information being delivered. For example, communications to corporate customers should always be supplemented by banker outreach, so providing talking points that ensure consistent messaging across the board will be important. Customer communications should be highly targeted, not just by segment, but personalized by customer, providing messaging that is relevant and can be absorbed by the reader.

5. Manage the customer experience using an omnichannel approach to communications. While federal regulations still mandate direct mail for certain legally required change information, a smart communications plan incorporates a variety of digital and other tactics to deliver and reinforce key messages. Email journeys can build awareness and reinforce high-impact changes, especially when action may be required, and can be useful to set expectations for timing and receipt of critical transition details. Interstitial or splash pages and secure online banking and in-app messaging provide valuable reminders throughout the process. And, finally, a dedicated microsite that is updated frequently can serve as a central communications hub to which all merger-related touchpoints lead.

6. Keep your employees well-informed and engaged. Customer-facing staff members play a vital role in the success of the integration process. The more confident and optimistic they are about the benefits of the merger for customers, employees and the bank, the better able they are to serve as merger champions. And when you arm them with sales and training tools detailing the conversion impacts, you set them up for success in providing the best customer service.

Your bank’s investment in an M&A transaction means you will acquire more new customers at once than you could in decades of organic growth. Through smart communications strategies and planning—who, what, when, where and how—you can retain those customers, while positioning your bank for new relationship building. Mergers represent opportunity, but they also represent change, which can be unsettling if not communicated effectively. A series of well-planned communications will work hard toward protecting your investment and ensuring the success of your merger transaction.

Pamela Reich is director of communications strategy at MKP communications inc., a New-York based marketing communications agency specializing in merger/change communications for the financial services industry.