Lacoste Take-Over

Groupe Maus Frères SA just announced plans to buy 30.3% stake in Lacoste buying out the stake held by the Lacoste family. Maus knows the brand well as a licensor and increases its existing stake in the company to around 65%.

If you buy a great brand like Lacoste consider the following:

  • Culture: It is critical to set up a distinct and focused brand management team with skills in brand strategy, product design, manufacturing / sourcing product, marketing, research and financial analysis. For some companies, this is a very different set of skills, thinking styles and personalities than those that already dominate the organization. If so, to be successful requires preparing leaders in the acquiring company for new people who will think differently and coaching them on the specific ways to work with them. For those being acquired or hired they need the same coaching plus given senior level leadership positions to influence and expand the culture of the organization.
  • Invest: After spending billions buying a great brand too many companies then skimp on spending the money needed to keep it a great brand. For example, a new product introduction in the US requires at least $10 million in advertising to have a decent chance at success. And bringing new people to manage a great brand is expensive. But these investments are always worth it. An iconic brand is a valuable brand, this large investment both protects this value and can increase it invariably offering excellent financial returns.
  • Understand: An iconic brand is a complicated brand. Customers don't think about what they are explicitly rather they have thoughts, perceptions and feelings that are implicitly. And so big brands are often hard to pin down — to truly understand what they represent. But all brands have a short list of core equities or values that can be revealed through savvy research analyzed by brand experts. For example one brand might represent speed and performance yet another fun and beauty. Keeping it simple helps the acquiring company learn about the brand and take actions that keep it on track, not inadvertently taking actions that undermine it.

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