You are now leaving this site and you'll be redirected to the Interbrand Global website.
Major players in the industry are using M&A to achieve business objectives; from executing R&D (research & development) strategy, or consolidating to accessing new markets and targets, and addressing loss of exclusivity status. The corporate brand and the product brand both have an important role to play within each of these strategies – and understanding how they are deployed can shed light on how you achieve your business goals.
It’s helpful to start by considering the market dynamics that are driving trends to actions to begin with so that we can truly understand the role of brand during M&A. When a pharmaceutical company is considering a merger, it’s important to consider how these dynamics are shaping the health ecosystem, how they impact the company’s current offering, and how they impact business and growth targets.
The first trend is Age at Home, a result of baby boomers population seeking (and expecting) solutions for problems and conditions associated with being older – including chronic care – within their own homes. OTCs play a huge role in Age at Home because, in essence, they enable it.
For the younger demographics, your late Gen Xers and Millennials, Preventative Wellness & Fitness is driving expectations around OTCs. This audience is looking at health as a preventative measure and defines health around wellness rather than managing illness. While OTCs have traditionally been about illness, we’re seeing many more products come into the market as a result of this trend that are more prevention-related.
The third trend is the concept of the Age Preservation, which zeros in not on age itself but on the conservation and maintenance of the qualities and abilities of youth. This is different than prevention. It’s the middle ground where people want to ensure that they can maintain their current state of health. This hasn’t impacted traditional OTC extensively; however, in certain areas, such as dermatological OTCs, we see growth and the impact of the trend.
Lastly, we have Consumer Control. Journeying, gatekeeping, and decision-making are all moving towards the patient. As patients gain more control and feel more empowered, they become eager to try more, to try anything and everything. This alters the expectations people have for OTC products because they may end up purchasing 3 or 4 different solutions for the same problem.
When it comes to M&A in the OTC space, companies should consider
Mistakes are usually made when either the corporate brand is undervalued or the product brand is over-focused on product benefits as opposed to the customer it serves. It’s important to look holistically at the portfolio and deploy both the corporate brand and the products brands in the right way for the right purposed during and after any M&A activity.