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5 Ways to Use Social Media When Acquiring a Company

Michalis MichaelMichalis Michael, a member of YPO in London, and his team listen to millions of conversations a day. As CEO of DigitalMR — a next generation market research company that helps organizations make informed marketing decisions by deploying social media listening — he is tapped into an infinite network of valuable information.

While financial results on paper can clearly show profits or losses, tapping into the world of social media reveals a company’s reputation in the market.

Below, Michael gives his top five reasons and tips for engaging in social media listening when considering a company acquisition.

1. Assess their reputation
Check the number of negative posts about the brand and/or the company, including their corporate identity over a period of time (usually the past 12 months). If the negative posts are more than the positive, the company will start losing brand equity.

2. Understand ‘what’ is being said and ‘why’
Drill down into posts and analyze them by topic — delivery, product quality and customer service. You will gain a thorough understanding of the issues and actions each require and learn whether the issues are fixable, or beyond repair.

3. See how they stack up
Compare brand benchmarks with competitive brands in regards to industry trends; discovering trends your target purchase is not involved in will give you leverage to challenge the seller.

“While financial results on paper can clearly show profits or losses, tapping into the world of social media reveals a company’s reputation in the market.”

4. Get a complete picture
Tapping into social media to discover how the world feels about the brand and by extension, understanding their online reputation, is a proxy for brand equity. By analyzing positive, negative and neutral posts in addition to financial due diligence, you will gain a complete picture of a company’s worth.

5. Negotiate
If you are the acquirer and find negative reviews out there that the seller didn’t disclose, you can negotiate down the price.

If you’re researching possible acquisition targets, information from the likes of Dunn & Bradstreet is great — by adding the social media approach, you can uncover what people are saying about your target brand where communities really live: online.

Deborah Stoll’s work as a journalist has been featured in The Economist’s online magazine, More Intelligent Life, in LA Weekly and its food blog, Squid Ink, as well as on the music site Buzzbands LA. Her short stories have appeared in the Los Angeles quarterly Slake and the literary website Fresh Yarn. As a musician, Stoll’s songs have been featured on American Idol, Glee and CSI: Miami, and her collective work as a content creator and animator has more than 1 million views on YouTube.