According to a survey from the New York chapter of the Association for Corporate Growth and Chief Outsiders, 60% of surveyed private equity firms consider the commercial engines of their portfolio companies as important as other elements such as the supply chain and liquidity, and 38% rate it important even if not at the same level as the other elements. In addition, 40% of private equity firms think their portfolio companies are ready to restart their commercial engines while 53% believe they will be ready soon. Meanwhile, 71% of respondents expect digital marketing and ecommerce to be more important for their companies going forward.
“Given the fundamental changes they expect to have to make — everything from their value proposition and messaging, to pricing, targeted customers, lead/demand gen activities and marketing and sales teams structures — we don’t see how they can be ready just yet,” Slade Kobran, managing partner at Chief Outsiders, said. “Especially as the scope of these changes are still uncertain.”
At the same time, many of the private equity firms surveyed expect their own marketing efforts to change in the post pandemic world, according to the survey. Specifically, these firms expect to adjust their own value proposition and messaging.
“As the private equity class looks to come out of lockdown and into a new business and investment paradigm, it will be even more important for managers to clearly articulate value to investors and potential acquisition targets,” Vikash Magdani, executive director at ACG-New York, said. “Many are working on engagement plans, how they will convey value and differentiate themselves in a crowded market.”
ACG is a member-based network for the global middle market private capital community.
Chief Outsiders is a nationwide “executives-as-a-service” firm, with 65 part-time or fractional chief marketing officers.