Dr. Chu Yanlai from the Department of Marketing of National University of Singapore Lectures in Wuhan University

 In the morning of November 5, Dr. Chu Yanlai from the Department of Marketing of National University of Singapore delivered an academic lecture entitled Quantifying M&A's Impact on Brand Equity: A Structural Approach in our university.

  From the perspective of marketing, Dr. Chu explained how consumers’ reaction to the M&A would affect the performance of enterprises from the viewpoint of consumers’ impact on enterprise strategic behavior. Taking Lenovo's acquisition of IBM's PC division as an example, Dr. Chu demonstrated to us a conceptual framework: in a merger activity, how these three mechanisms – brand asset, cost synergy and product mix – would affect corporate profits. And he also used this structural model and fold difference method to quantify the combined effect of the three aforementioned mechanisms on corporate profits, and he separated the main effect of each mechanism and the interaction among them from the total effect. According to statistics, Lenovo's acquisition increased the consumer evaluation of the Lenovo brand and generated much more significant cost synergy. Among them, the acquisition-led brand asset increase had the biggest impact on Lenovo’s profit, followed by the cost synergy generated from the acquisition. At the same time, this brand asset improvement was mainly due to the joint brand "Think Series" instead of the acquired "IBM" brand. These three mechanisms strengthened synergy with each other, thereby generating profit for Lenovo.