There are many different ways to handle brand integration – whether it means discarding the target’s brand in favor of your own, keeping both brands, or creating a new one. Each strategy is valid, depending on your brand equity and strategic rationale for acquisition.
Let’s look at a live example: In its $2.5 billion stock-for-stock acquisition of Trulia which closed on February 17, 2015, Zillow has chosen to keep both brand names.
CEO Spencer Rascoff discussed branding in a recent interview:
“Trulia will very much be its own brand but won’t be its own company. The Trulia website will remain but, over time, the listings inventory and the advertising sales will come under Zillow. Trulia will still have a consumer-facing team to grow audience. The analogy I would make sort of relates to my old stomping ground of online travel, where a lot of companies — including Expedia and Orbitz — have different front-end facing sites but the inventory on the back end and other functions are a shared services.”
Here we have an example of leveraging two well-known brand names in order to dominate the online real estate market. By keeping Trulia and Zillow as separate, consumer-facing brands, the combined company reaps the benefits of both brands’ equity, while realizing the cost-saving synergies of consolidating back-end operations.