Digital due diligence requires insight into an acquired company’s brand, websites, content, social media channels, etc. Learn about the best digital due diligence practices from Progress based on our M&A experiences.
Who meets with whom when a company acquires, or merges with, another? Specifically, what are the first steps in any due diligence process during a merger and acquisition?
During our own mergers and acquisitions, due diligence at Progress will focus on people, systems and processes. While each of those areas could result in their own separate blog posts, we are going to spotlight our processes within the marketing and web operations realm. More specifically, understand an acquisition’s digital presence and how we can maintain it on our own terms. This process, involving an incoming company’s digital marketing assets, is commonly referred to as “digital due diligence.”
Digital due diligence requires insights into areas including, but not limited to, an acquisition’s brand, product branding, web strategy, paid media campaigns, messaging and social media. The goal is to figure out opportunities for growth, what financial risks are involved and, most importantly, the future alignment of marketing goals. For example, an enterprise company realizes a recent acquisition has a website with poor technical infrastructure. Through this research, the acquirer knows how to invest in a new content management system (CMS) or possibly migrate to the acquirer’s website.
However, when acquiring another company, as well as its employees and systems, digital due diligence makes onboarding a straightforward experience, not only for the company itself, but also its brand and even its customers. Using another, more recent example: When Progress acquired Kemp, who has a strong user community, we wanted to migrate said acquisition to Sitefinity but did not want to affect the experience of current users. Nor would we want to disrupt any potential web traffic coming to the community’s pages. Because Progress’ web operations team used digital due diligence regarding the two websites, we were able to successfully migrate the acquisition and maintain Kemp’s ever-popular developer presence.
At the start, a Chief Marketing Officer or VP of Marketing (or in our case, EVP of Marketing) will meet with the acquired company’s marketing executives to discuss the following:
These high-level, executive-led discussions lay the foundation for what the onboarding needs to focus on. Ideally, questions about lead scoring models, customer databases, marketing programs per channel (including product and region), communicational strategy and sales funnel stages should be asked about at this stage. While those inquiries are being answered and distributed to the right teams, an analysis of the onboarded company’s technology stack begins around this time, as does the digital due diligence phase.
Digital due diligence is a multiple-colleague effort. After figuring out what digital marketing assets need to be worked on, the VP of Corporate Marketing would start assigning specific and practical tasks to digital marketing, creative, marketing operations, corporate communications and technical leads.
Teams would begin assessing the technology stack, which can involve the integrated CMS, any marketing automation (MA) systems, third-party configurations and/or webinar/video platforms. Other more specific assets in this analysis include blog pages, SEO rankings and social media campaigns (both organic and paid).
The time of the analysis will vary. In that time, an acquirer should begin evaluating these digital marketing assets and areas to figure out when to put these in the implementation process. Using two specific assets listed above, MA systems and third-party applications, as examples of how the analyses occur. MA systems will require two people, one from the leading company and one from the acquired company. Schedule meetings (either in-person or virtual) to determine which ones are important—for example, the ones vital for creating and/or executing marketing campaigns.
When integrating third-party apps, an acquirer must obtain a complete list. From there, the person taking the lead on this task starts reducing the number of apps due to overlapping functionalities between the Progress martech stack and the acquisition, scalability, ease-of-use and/or monetary value. Additionally, our M&A team evaluates what tools and products the acquisition is using and potentially implements one of them. Please note, this process does take some time. Consider how many third-party apps are available for a digital experience platform (DXP) like Sitefinity.
Lastly, when each implementation goes live, double-check assets and how each is working. Shut down any conflicting MA configurations that may affect the website’s performance, the customer journey or lead funnel operations; execute a communications plan complete with email updates, new employee portals, etc.
Any business procedure within a merger or acquisition will have challenges, especially for companies undergoing their first, as anything can slip through the cracks. An acquired company’s digital assets are no exception. Following one of these best digital due diligence practices adds helpful components to your M&A strategy.
After all, who wouldn’t want to apply the phrase "work smarter, not harder" to the complicated M&A process?
Atanas Vasilev has spent the majority of his career in the tech sector of Sofia, Bulgaria in various technical and business roles like QA; Project and Product Management; Manager of different technical, business, and creative teams throughout the years for creating end-to-end marketing and back-office web applications. As a result, his passion for understanding business needs and building technologies that support marketers draws him to the world of Marketing Operations.
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