Strategic acquisitions are a bet on the future growth and success of a company. Yet study after study puts the failure rate of mergers and acquisitions somewhere between 70 and 90%.
There are many reasons takeovers fail, but a chief contributor is that acquisitions themselves can jeopardize success by undermining customer experience. As newly combined organizations sort through the integration of cultures, technologies, teams, service structure, product roadmaps and more, customer experience often suffers. The impact can mean slower-than-expected growth and increased customer churn.
Here are the things acquirers should be looking out for to ensure their newly acquired customers stay happy, and questions they can anticipate hearing from them.
Factors that impact customer experience after an acquisition
New owners of a company should be concerned about potential changes that will impact their customers, including pricing, support channels, product features, and overall service quality.
Specific questions they should consider, and be prepared to answer, include:
Products and Services
- Product Roadmap and Future Development: Will the acquired company's products continue to be developed and improved, or will they be phased out or integrated into the acquiring company's offerings?
- Feature Changes: Are there any plans to remove or modify existing features, or to add new ones that might not align with the customer's needs?
- Integration with Acquirer's Ecosystem: Will the acquired company's products and services be integrated with the acquiring company's platforms and services, and if so, how will this impact the customer's workflows and integrations?
- Discontinuation of Products: If the acquiring company discontinues any products or services, how will customers be supported through the changes?
Pricing and Contracts:
- Price Increases: Will the pricing of the acquired company's products and services remain the same, or will the acquiring company implement new pricing models or increase prices?
- Contract Renegotiation: Will the customer need to renegotiate their contracts with the acquired company, and what terms can they expect from the acquiring company?
- New Billing and Payment Terms: Will the customer need to update their billing information, or will there be changes to the payment terms?
Customer Support and Service:
- Support Channels: Will the customer still be able to access the same support channels and resources, or will the acquiring company implement new support structures?
- Support Quality: Will the quality of support remain the same, or will it decline as the acquired company's resources are redirected to other priorities?
- Key Contact Changes: Will the customer's key contacts within the acquired company be replaced, and will the new contacts have the same level of expertise and experience?
Company Culture and Leadership:
- Leadership Changes: Will there be changes to the leadership team of the acquired company, and how will this impact the customer's relationships and trust?
- Company Culture: Will the acquiring company's culture clash with the acquired company's culture, and how will this impact the customer's experience?
- Employee Retention: Will key employees within the acquired company be retained, or will they be replaced by employees from the acquiring company?
Data Security and Privacy:
- Data Storage and Processing: Will the customer's data be stored and processed in the same locations and with the same security measures, or will there be changes to the data handling practices?
- Data Access and Control: Will the customer retain control over their data, or will the acquiring company have access to it?
- Data Security Breaches: Will the acquiring company have the same level of data security as the acquired company, or will there be a greater risk of data breaches?
Conclusion
At the end of the day, acquisitions can be a game-changer, but they come with plenty of challenges—especially when it comes to keeping customers happy. If companies don’t handle things like product changes, pricing, support, and leadership transitions carefully, they risk losing the very customers that made the deal worthwhile in the first place. The key to success? Open communication, thoughtful planning, and a real commitment to making the transition as smooth as possible. When done right, an acquisition isn’t just about growth—it’s about creating a stronger, more valuable experience for everyone involved.
