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Unilever must tread with caution to hang on to Graze's top table talent

The Unilever buyout of healthy food snack firm Graze is yet another example of big FMCG heavyweights taking on smaller challenger brands to drive expansion, harness innovation and diversify into 'fashionable' growing markets and consumer trends – spanning health, socially-conscious, purpose-driven and subscription-based services. 

The first deal in his new post as Unilever CEO, Alan Jope is not only proving the 'in with the new' approach, bringing a fresh perspective and capitalising on the success and innovation from within these smaller brands – but he's acquired a hugely talented management team overnight through Graze, one that shouldn't be taken lightly. 

As seen before, talent from within these fast-growing challenger brands will run for the door if a large corporate gobbles up the character, feel and culture that led to their original success. Just look to the likes of Premier Foods, which bought out Campbell Soup and RHM, the brand behind Mr Kipling and Hovis, in 2006. Both brands boasted modern, empowering and autonomy-driven cultures pre buy-out, that senior leadership felt was lost following acquisition. As a result, both firms saw a mass exodus of staff, with the majority of their leadership teams departing. More recently Premier Foods has announced plans to sell its well-known custard brand Ambrosia in an attempt to revitalise business and also announced that its CEO would step-down in early 2019.

A successful M&A recognises the key to victory goes way beyond product, to people – something Unilever would benefit from in the coming weeks and months to retain Graze’s core leadership team. It is all too easy for talent to flee after big corporate buyouts – and the parent brand must prevent this by assuaging fears with a lighter touch approach. By offering the balance of trust and autonomy to the existing leadership to take the company forward, alongside further extending its distribution, networks and financial clout, Unilever can retain the kudos of Graze while helping take the business on a new growth journey.

Those that have done this well with actuations include Molson Coors. The US brewing giant who bought Sharp’s, the brand behind heritage-driven Cornish ale Doom Bar, back in 2011. Through limited publicity of the deal and by taking a softer ownership stance, which resulted in Sharp’s retaining the original leadership team, the buyout was understated and allowed Sharp’s identity – as a small, regional brewery, with a focus on tradition – to be maintained. By safeguarding the autonomy of the original leadership team, Molson Coors has since helped Sharp’s boost sales and distribution, while preserving its culture and well-loved brand – with success proven by Doom Bar’s recent expansion into a new product line.   

As with most deals, some talent will stay and some will go. However, Unilever’s track record is promising – with past successes including the 2001 buyout of Ben & Jerry’s. Yves Couette, brought in by Unilever as Ben & Jerry’s new CEO, introduced fiscal and managerial controls while displaying keen awareness and sensitivity to existing culture – making sure to preserve the ice-cream brand’s identity and values, including its emphasis on corporate social responsibility. This light-touch adaptability has also fuelled Unilever’s growth in the beverages market, with the recent takeover of tea and infusions brand Pukka Herbs.  A commitment to preserving Pukka’s Fair Trade and sustainability-driven values has delivered a new and exciting chapter for the business.

As Unilever looks to diversify its portfolio further and take on more independents such as Graze, as well as having a clear appetite for acquisitions extending into the cosmetics industry, it must make sure to stick to this winning approach. This way, it can reap the benefits of Graze’s innovative and talented team – and ensure that success going forward is far from bite-sized.

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