The media industry saw a flurry of mergers and acquisitions (M&A) in 2019, and this trend is likely to continue through this year and next. Big examples included VICE Media’s $400 million acquisition of Refinery29, as well as the merger of newspaper publishers Gannett and GateHouse Media (Lineup customers), among others.
Inevitably, when two or more large entities combine, they have to restructure systems and processes to work together toward a common goal. This can be a complicated, time consuming, and painful undertaking if it’s not handled carefully. Combining several disparate advertising systems is a necessary (but often painful) part of this process. Determining which tools should go, which should stay, and who trains whom etc. can be tough, which is why we recommend starting with some basic questions about the tech stack of a company you’ve just acquired. Here are 5 questions to get you started:
What are the contract terms?
Start with the technical specifications outlined in the contract, especially if the products or services have been customized for the company you’ve acquired. The contract should outline the tech’s expected functionality as well as how the vendor measures its performance.
You should also review the information related to warranties and service levels. The more essential the technology is to your business, the more robust this part of the contract should be. In addition, you should ensure that the contract addresses data ownership in full, including everything from storage to transmission to access.
If you decide to hang on to the system, keep in mind when it’s time to renew the contract that some vendors offer little room for negotiation. However, others—often those that deliver more complex or personalized enterprise-level service—enable you to have greater bargaining power as a customer.
What are the benefits and pain points of the systems?
There are several areas to examine when you’re evaluating the benefits of technology. For example, ask the company you’ve acquired to see statistics on the system’s ROI. How much have leads and sales increased as a result of implementing the system? How much has ad revenue and subscription revenue increased?
You can also inquire about how much time the tech saves different areas within the organization, such as finance, IT or marketing. Seeking perspectives from diverse user groups will help you get the big picture of the platform’s value.
When you’re trying to uncover the pain points of a technology system, you may quickly learn that it’s cumbersome, slow, or complicated to use. However, even if people don’t have many complaints, it’s useful to ask your new staff what capabilities they wish the system offered. This will help inform your future decisions.
How well is each platform equipped to scale with your business?
Competition and disruption in the publishing industry have ascended to new levels in recent years, and are still on the rise today. Almost 60% of organizations worry how their business will fare in the age of digital transformation, according to research from IDC.
The industry has been rocked before by events like the advent of the internet, smartphones, and social media—however, it has always responded with an innovative spirit. It’s critical that you evaluate each area of your tech stack to ensure your systems will help you adapt to whatever trends emerge on the media landscape in the future.
Publishers should choose technology, not based on the trend of the moment, but on how well the technology can respond to their evolving business requirements. If a platform isn’t flexible or scalable, it may not be the best option for your media company.
How user-friendly is each technology?
User-friendly technology has huge potential to positively impact your business, and the reverse is also true. Unfortunately, 25% of U.S. workers say that the technology within their organizations is detrimental to their productivity, according to a survey by Samanage.
To avoid this problem, test the entire tech stack of the company you’ve acquired to ensure that each solution is easy to use. This will help your internal and external stakeholders reap the greatest possible benefits from the systems.
Keeping only user-friendly technology will also help the adoption phase of your M&A process run more smoothly, and will keep your IT team from getting bogged down by minutia so that they can focus on mission-critical tasks.
How secure is each platform?
In 2019 alone, more than 14 billion records were exposed in data breaches. Amidst growing concerns around data privacy, it’s imperative that publishers protect the personal information of their customers, staff, and partners.
When you acquire new tech, complete a database audit to evaluate areas such as access, risks, and data quality. A database audit can help you protect against breaches and maintain solid customer trust.
Need help? Try this.
We get it – going through a merger or acquisition is tough. Thankfully, countless examples have shown that when done correctly, a M&A can result in long-term success. If you’re struggling to evaluate your (new and more complex) tech stack, try writing a Request for Proposal as if you’re looking for an entirely new solution for both organizations. This will ensure everyone on your team is on the same page so you can find the best fit for the organization as a whole. This template will help you get started!