8 marketing strategies that drive successful M&A

When AeroVironment announced its intention to buy BlueHalo in November for $4.1 billion, it marked the continuation of an active 2024 mergers & acquisitions climate – one that has built on strong transaction volume from last year, which saw 127 closed transactions per Washington Technology data.

The multi-billion dollar transaction marked the 80th time that we provided marketing support to a B2G or B2B brand that was acquired within two years of engagement. With this repository of successful acquisition support, you pick up a few things.

Commonalities in marketing strategies, processes and perspectives emerge. The line of demarcation becomes clearer, separating government contractors – and private backers – that achieve highly successful exits from the ones who do not.

We saw an opportunity to analyze these projects in a way that would be instructive for any government contractor that – in the near or long-term – seeks to maximize enterprise value for an exit.

Our own analysis draws from more than 100 government contractors with pre-acquisition annual revenues ranging from less than $10 million to the multi-billions.

There are dozens, if not hundreds, of contractors at this moment pursuing or contemplating an exit – or simply trying to build enterprise value to achieve myriad business objectives. What are they getting right? What are they missing? We seek to answer both questions by laying out a set of 8 marketing and public relations strategies most present in these successful exits.

1. Market to stand out, not fit in.

Even large contractors get sucked into marketing language that needlessly commoditizes what they do. Everyone is innovative, has great customer service and solves complex challenges.

The ramifications of this approach are even greater for small and midsized contractors that obsess about “checking the box” just to prove they can match bigger competitors’ capabilities.

It’s a slippery slope; contractors that effectively market to stand out with agency decision makers are able to differentiate and grow enterprise value. Potential acquirers and investors, for their part, are not looking for redundancy. They seek to create new agency and market inroads, offer capabilities and services beyond their existing portfolio, and gap fill areas where it is strategically advantageous to buy rather than build.

2. Message to the opportunity, not the government.

The Defense Department isn’t one customer; it’s hundreds. Contractors who get it right speak to an audience of one, or a few, rather than attempting a cookie-cutter message built for mass consumption.

Messaging and targeting must reflect that. Unlike the commercial market where vendors and service providers can conceivably message to a “financial services firm” and replicate that across the industry, trying to create a message that universally resonates across DoD is more perilous.

Branches, units and individuals are driven by specific objectives, and the ability to build branding, messaging and go-to-market campaigns aligned to that reality is critical.

3. Don’t avoid tough conversations with sales teams.

Sales teams have a million reasons not to bother the customer. Some are justified. There’s been a setback in execution, we don’t want to rock the boat, whatever it is.

In our experience, there isn’t a single component of PR that drives a more tangible business and enterprise value impact than compelling customer stories with strong ROI.

Contractors that collaborate to develop and manage a robust customer stories program from day one (contract signing) unlock numerous PR services that raise enterprise value, including media coverage, award programs, speaking opportunities and social media.

4. Contract pursuit-based PR needs to start early.

There is growing recognition by contractors and marketing agencies alike that PR needs to activate far earlier in the contract and vehicle pursuit process – months ahead of a perceived decision point milestone.

And that the right PR services need to be chronologically aligned to reach the right decision makers at the right time with the right message. This means establishing a rolling cadence from RFP or pre-solicitation that builds brand awareness, brand credibility, brand differentiation and, closer to contract award, hyper targeting of decision makers.

5. Prioritize contract narratives over contract dollars.

Unless you are the biggest of the bigs, contract award dollar values get lost in a sea of zeroes. Yes, winning a sizable contract and publicizing it boosts brand credibility, but at the end of the day agencies, press and investors want to see market impact and how you are solving customer challenges. A strategically developed narrative can generate more high-impact coverage for a $5 million contract that a $100 million contract if executed properly.

6. Crush silos, embrace integration.

Contractors that have achieved successful exits do not view PR – or any marketing channel – in a vacuum. They tightly align with paid and owned activities, events and broader business activities.

Hyper-targeting of contract decision makers is undermined with a siloed approach that lacks proper cadence through the demand generation and lead generation process. Through our portfolio of acquired contractors, an unmistakable narrative is that the more integrated PR and marketing activities are, the more enterprise value is lifted.

7. Messaging/Branding perfection shouldn’t be the enemy of PR progress.

The value PR delivers can be undermined with ineffective or half-baked messaging and branding. However, contract cycles are long, and B2G brands often miss critical windows to make public relations ‘brand leaps’ because messaging or branding processes drag indefinitely.

Contractors should not treat this phase as stealth mode; most PR components can still be activated in some form, in parallel. Waiting too long cedes opportunities to competitors and creates a brand deficit that can be difficult to recover from.

8. CXO Visibility matters.

While it is a stretch to assert extroverted founders and CEOs achieve bigger exits than their introverted counterparts, it would not be a surprising conclusion. The Golin 2024 CEO Impact Index (CII) analyzed more than 100 data points of Fortune 250 CEOs seeking to connect executive visibility with business performance.

The results?

The most visible top 50 CEOs saw an 80% higher average annual share price relative to the average. For the top 10 CEOs, it was a 239% share price growth premium over counterparts.

The survey reflects the positive impact that visible CEOs can have on raising enterprise value – which translates to more successful acquisition events.

Let’s be clear; marketing cannot put a shine on inferior products, technologies, leadership and prevailing market conditions. But our analysis finds that contractors embracing the marketing strategies referenced above are able to build enterprise value that drives positive M&A outcomes.

As such, they are marketing investments worthy of consideration for any management team considering an exit in the near- or long-term.

Brian Lustig is general manager for public relations at Bluetext, an award-winning digital marketing agency based in Washington, D.C.