Is the expected post M&A growth grounded in additional long-term customer value: broader product portfolios, stronger service, new capabilities? Or is it mainly an Excel-driven forecast designed to satisfy investor expectations at the moment of the deal?
This is where sustainable value creation begins. If the growth story is rooted in customer benefit, then commercial priorities — value proposition, sales, marketing, customer experience — must be placed at the center of integration. Efficiency and cost levers should follow, or run in parallel, but they cannot overshadow the commercial side.
At h23, we see time and again that focusing on customer value pays off. It starts with the question: “What are the benefits for our customers due to this M&A, and how are we going to deliver them?” When that question guides both the deal thesis and the integration plan, shareholder value follows — sustainably.
Integration is where the deal’s intention meets reality. As we argued in…“It’s not about taking over, it’s about building what’s next”, integration should not be a compliance exercise but a transformation moment. And the customer should be at the center of it.
The deal logic: financial and customer value drivers
Every acquisition combines two types of logic:
1. Financial logic: multiple arbitrage, cost efficiencies, margin improvement, and economies of scale.
2. Customer logic: a stronger value proposition, more choice, new geographic access, and the ability to deliver solutions that customers truly need.
Both matter. In fact, the most powerful deals are those where financial and customer drivers reinforce each other. Yet while the financial side of the deal is typically modeled in detail, the customer side often enters the conversation as an aspiration rather than a rigorously planned driver of value.
This is risky. Research by McKinsey shows that 80% of value creation among top growth companies comes from existing customers, not new ones. Replacing a lost customer often requires acquiring three new ones. If customer retention and growth are overlooked in M&A planning, even the most carefully modeled financial synergies may never materialize.
And this is where the challenge begins: while both logics are clear at signing, integration often strays from the balance that was intended.
The reality gap: when execution strays from intention
If most deals begin with a balanced ambition — financial returns and customer growth — why do so many fail to deliver on that logic?
The problem is one of post-acquisition priorities. Integration teams, under pressure to show early progress, focus on areas where synergies are easiest to measure and control: finance, IT, HR, and procurement. Back-office consolidation delivers quick cost savings and tangible KPIs for the board.
But the commercial side of integration — aligning sales teams, reshaping the value proposition, harmonizing customer experience — is often delayed. It is more complex, harder to measure, and riskier in the short term. As a result, the very commercial drivers that justified the deal are the first to be postponed.
A recent Harvard Business Review article (2024) puts it bluntly: management teams often move “shockingly slow” to integrate sales, marketing, and customer experience. This undermines top-line growth and stalls the realization of the deal’s strategic promise.
The result is a paradox: the synergies that matter most for customers — and ultimately for shareholders — are the ones most likely to be neglected during integration.
Turning intention into execution: the h23 customer value playbook
If customer value is the foundation of the deal, integration must be sequenced to reflect that. The commercial side cannot be an afterthought.
Here’s how we at h23 approach the customer value creation post M&A:
1. Define the customer promise and communicate it:
Every merger begins with assumptions about what customers will gain — but too often this remains vague. A “customer promise” should be explicit: more choice, faster delivery, stronger expertise, or the benefits of local presence combined with global reach. Define this early and communicate it clearly, both externally and internally. If employees don’t understand the promise, customers never will. A simple, consistent message becomes the anchor that keeps everyone aligned when the complexity of integration sets in.
2. Protect continuity where it matters most:
Customers are quick to sense instability. If service levels dip, deliveries get delayed, or key contacts disappear, trust erodes fast. Integration must therefore safeguard the basics, ensuring reliability through the transition. This doesn’t mean freezing the business — it means protecting critical touchpoints while building toward improvement. Stability during integration is not the end goal, but the foundation for delivering on the new commercial promise. Done well, continuity itself becomes a proof point that customers can rely on the new organization.
3. Align commercial teams early:
Sales, marketing, and service are the frontline of integration — and where customers form their impressions. These teams need clarity on the new value proposition, what changes for customers, and how to communicate it confidently. Don’t underestimate the mindset shift required: salespeople often have to learn the new offering while selling it, which can be daunting. Support them with training, success stories, and quick wins that prove the value of the merger. Communicating those wins internally reinforces belief and builds momentum across the organization.
4. Translate synergies into customer wins
When customers hear about “synergies,” they assume it means either lower service levels or higher profits for owners. Rarely do they see how it benefits them — unless you show them. A portion of synergy value should be reinvested into the customer experience: digital tools that improve access, stronger service capacity, or new products they care about. And where reinvestment options are limited, look for creative gestures that demonstrate customer benefit. It doesn’t have to be price cuts — small but visible improvements can make the difference between customers feeling exploited or empowered by the merger.
5. Measure customer impact, not just cost savings
Dashboards typically track synergies, IT migrations, or process consolidation, but these only show the internal side of integration. If growth was part of the deal thesis, then leaders must track whether customers feel the value. Metrics such as churn, retention, NPS, satisfaction, and share of wallet provide a clearer picture of whether the merger is delivering on its promise. Also boards gain confidence when they see customer metrics reported with the same weight as operational ones — proof that growth is more than a spreadsheet projection.
McKinsey’s research on customer-centric operating models confirms the payoff: customer-first transformations can lift retention by 5–10% and deliver significant EBIT gains.
Conclusion: shareholder value through customer impact
M&A should never be just about financial engineering. Shareholder value is maximized when customer and financial drivers work together — starting from the deal thesis and carried through into integration.
When deals begin with the question “What are the benefits for our customers, and how will we deliver them?”, the commercial priorities of integration naturally take center stage. And when customers win, shareholders win — in ways that are both stronger and more sustainable.
Buy & build strategies succeed when commercial logic is executed with the same rigor as financial logic. That’s how deals deliver not just numbers on a spreadsheet, but real, lasting value.
