Ask an Expert Franchisee March/April 2018

Q. What do I need to know about franchise marketing before getting started?

Marketing is a vital component in every business. After all, without at least a basic marketing program, your product or service is relatively unknown to potential customers. While there are quite literally thousands of marketing tactics found in expert articles, books, and websites, in the world of franchising, your marketing program is often dictated by the franchise brand standards manual, and other operational and legal documents.

Most franchise agreements include a recurring marketing or ad fee. Often, franchisees are confused as to what this fee covers, and wonder: “What do I get in return for my contribution?” While franchisees can measure the success of their local campaigns a bit more easily, measuring the success of national campaigns may be more difficult. When considering a marketing fee obligation (whether a percentage of revenue or flat rate), as part of the process of evaluating a franchise in which to invest, it is vital that you understand the specifics of how the fee is being used, and more importantly, how it builds value for your business.

Establishes brand consistency

Unlike the franchise’s corporate operation, where one marketing department pushes out the same materials to every location, franchisees often bear the responsibility of creating their own marketing material, collateral, and promotional items, subject to franchisor approval. A well-established marketing plan at the franchisor level should offer specific requirements and details that can help you determine how these materials are developed. This means that your franchisor should be specific when it comes to logo design and usage, image selection and scaling, colour scheme (down to the specifics of pantone and HTML colours), font scheme (for print and for web), as well as logo usage. Some franchisors even establish electronic access to a proprietary or third party portal, where franchisees can access graphics, templates, and other materials to streamline and standardize the creation of local franchise marketing materials.

Centralizes and decentralizes responsibilities

A franchise marketing plan identifies what marketing responsibilities will be centralized (undertaken at the corporate franchisor level) and which will be decentralized (undertaken at the franchisee level). In some instances, franchisors may offer quarterly national and international marketing campaigns in which the corporate office distributes specific marketing materials to franchisees. During other times, however, franchisees are often responsible for their own ongoing direct mail, social media, and grassroots marketing endeavours, as long as they are compliant with franchisor branding and marketing specifications and requirements. There is no specific formula for the “right” way to centralize and decentralize marketing efforts, because it’s often contingent upon a number of factors, including the industry, business size, number of locations, and specific product or service being marketed.

Creates a system

Naturally, franchisors and franchisees will periodically share information between one another and about one another in their marketing materials, like news of franchise growth and performance. Best practices for franchisors include reporting back to franchisees on how system marketing fund expenditures are allocated. Likewise, a franchisor might also want periodic updates from franchisees regarding local marketing efforts, budget, social media following and engagement, and more. To ensure that communication is flowing efficiently, the goal of an appropriately developed franchise system marketing plan is to establish a means for franchisee tracking and reporting. This system identifies how progress is reported and how often, in addition to who franchisees are reporting to, what formats should be used, and to whom all of these reports are sent.

The most important thing to remember when analyzing a franchise system’s marketing package, in addition to its consistency and transparency, is your ability to openly communicate your thoughts, concerns, ideas, and other feedback to your franchisor. A franchise marketing program should always develop and grow, and your great ideas, in combination with the established standards, should become part of the building blocks of the plan.

Be sure that any of the franchise options you are considering have these systems clearly laid out in their system marketing plans. If not, it’s best to turn your attention to an alternative franchise concept that you are confident has the tools and procedures in place for effective, system-wide marketing that benefits everyone involved – at the corporate and local levels.

Matthew Jonas
President and Co-Founder
TopFire Media

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