Marketing essentials; Understanding what you are entitled to
What is the marketing support you can expect when you invest in a franchise?
To start with, you’ll be looking for a business that already optimises its branding. You’ll want to find a company that has a good recall among consumers, which understands how to use a mix of marketing channels to achieve success with its message, that invests in market research to ensure the channels and goals match the audience, and is committed to investing in communicating core messages to customers.
Digital marketing can include direct marketing to an email address, social media videos, content marketing to be distributed on websites, and advertising through search engine marketing and pay-per-click marketing.
Unless you are a marketing guru yourself, you’ll be looking for a franchise marketing team that has a clear understanding of how to use these tools to achieve results, and can keep campaigns fresh and relevant.
Franchisees can benefit significantly from a high level of marketing support that helps deliver strong national campaigns to increase brand awareness, and provides tools and guidelines for local area marketing.
It is common for franchisees to spend on promoting their own business in the neighbourhood, whether through traditional channels such as letterbox and print advertising, through social media channels, and through sponsorship and community support.
Franchisors may provide templates and approved material for franchisees to utilise in certain channels, or may instead insist on an approval process for marketing collateral generated by the franchisee.
Marketing should be directed at ways to both attract and retain customers, and the tools and strategies on offer should be based on solid market research.
Of course marketing can take the form of one-off events that engage new and existing customers. Soul Origin’s barista finals competition for instance, that took centre stage in Sydney’s Martin Place earlier this year, attracted big crowds and enhanced the brand’s coffee profile by emphasising the creativity and professionalism shown by its baristas.
It’s important for any franchisee to understand how the franchisor will handle omnichannel marketing that takes place in store, online, through an app.
It’s important to understand whether or not the franchisor will be selling its services or products directly online.
If customers are buying the same products available in a franchised outlet, what happens to the profits from these sales? It’s increasingly common for franchisors to ensure the franchisee who would otherwise have scooped the scale gets some financial benefit from an online purchase - this is usually decided on a geographical basis.
Technology is crucial to operating a business today, and any franchisee needs to be aware of all the opportunities that exist in the brand to market and sell. Will the franchisee be allowed to sell online?
If a franchise operates a mobile app in the fast food arena, it’s likely the franchisee will be paying towards the cost of the technology that is delivering extra orders to their business.
Rules and regulations
It’s important that franchise buyers consider what the disclosure document and franchise agreement reveal about marketing and alternative selling techniques, the costs entailed, and any restrictions on trading.
Franchisors will of course be charging for the marketing they generate nationally: typically a marketing fund fee will be between one and five percent, so it pays for the franchisee to have confidence in the marketing decisions made at head office.
There are specific rules about the marketing fund enshrined in the Franchising Code of Conduct; the recent parliamentary inquiry into the code’s effectiveness has raised concerns about how the funds are being used by some franchisors and may result in stronger rules being applied in the future.
For now, look for a franchisor who is transparent with its marketing fund and marketing information so you can trust the process is best targeted to franchisee success.
It’s good to remember franchisees have their own roles to play in boosting brand prominence and ensuring consistency and compliance across the network.
Staying on message is important for the brand, and the advantage of a franchise is that the message can be delivered to you. The marketing team can come up with the concepts, decide the best channels, and provide you with the best ways to enhance your business and boost customer loyalty.