Using Social Media to Inform Mergers & Acquisitions

When Facebook announced it was buying Whatsapp for a cool nineteen billion dollars, a ripple of excitement and energy shot through the social landscape (and Jan Koum’s wallet).

But behind these get-rich quick dreams and deals, the reality is a lot of hard work, time-consuming analysis and weeks, if not months, of networking and negotiating.

Why?

Because failure to effectively assess the seller’s business and operations could potentially lead to lower valuations, erroneous assumptions, risk and increased financial exposure, to name a few.

Every so often sellers intend for tight control of information to remain in place through the actual closing, whereas you will need to complete a due diligence review and thoroughly investigate the company’s health and reputation, its products, its customers, the market and even competitors.

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What if you can jump over the preliminary stage and go straight to the negotiating part?

Nothing’s impossible.

With any enterprise social media analytics tool – we’re not pointing to any in particular – you can collect substantial and readily available data in minutes to seconds, much of which is not commonly found or accessible via other avenues.

We see companies using social media analytics throughout the M&A lifecycle, ranging from the preliminary stage of identifying target companies to the final stage of post-closing integration.

That being said, let’s take a look at how social data can be used to safely undertake due diligence:

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1. The Customer Voice

Initially, social media research will help you to establish how a M&A target is perceived by its current and potential customers. Who’s whispering about the company and what are the particular facets of the business’s perception?

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2. Social Media Presence

Start by doing an audit of all your candidate’s owned social profiles, perhaps by using a channels feature.

Poor implementation of a solid social media strategy can often have direct repercussions for any company’s ability to market, sell and extend its brand reach anywhere in the world.

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3. Competitive Landscape

Equally important, you will want to know how the company stacks up against its