The recent acquisition by Meredith Corporation (NYSE: MDP) of Allrecipes.com strikes The Merger Verger as a strategically brilliant deal. It doubles their digital revenues with the top food website in the world and brings them enormous digital media and social networking expertise. The leverage potential is high, with opportunities to create value from Allrecipes to Meredith and vice versa.
Meredith is buying two distinct forms of fleet-footed assets: customers and tech expertise. Blow the first few months of integration and the acquisition’s value proposition could deteriorate rapidly due to site visitors or employees taking flight.
Allrecipes.com is a very strong site that has generated a powerful brand. That suggests a degree of customer stickiness that would in turn suggest focusing first on retaining talent within the organization.
Recommendations for Meredith:
- Turn the new-deal tap off (or way, way down). I know that Meredith Chairman & CEO Stephen Lacy sees a host of great media properties available in this post-recession environment but now is the time to “get right” those that he has already done, not get more to do.
- Communication will be a key part of the integration puzzle. With such a strong strategic intent, they should be telling anyone who will listen about the benefits available to both organizations by thoughtfully executing on it (and telling it over and over). Touch the Allrecipes employees, particularly the key IT folks. Get down with them where they are.
- Having purchased a company with a strong social media component, respect that society. However alluring the opportunity might be to start selling their other products to Allrecipes customers, do not rush around stuffing them with offers. Instead, contribute to their social experience, demonstrate the potential of cross fertilization with the other properties and invite them into the expanded world of Meredith. Pull, do not push.
- Incorporate Allrecipes.com thought leaders (at multiple levels) into the larger game planning for Meredith’s digital future. It will send positive signals about the role of “new media” in a historically print-based company and increase the flow of expertise and ideas. Oh, and listen to the ideas from the Allrecipes guys; their input is not just for show.