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Researching a Franchise

Attract Those Franchisees Today

Struggling to find high-quality franchisees? You need to take a close look at how you market your franchise.

Entrepreneur

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Growing a franchise can be hard work. You have to think about corporate sales and marketing, as well as providing for the franchisees.

It looks something like this:

  1. Corporate marketing programmes
  2. Corporate marketing programmes for franchisees
  3. Additional marketing programmes offered through corporate for the franchises

Each of these initiatives takes a lot of work — and you can’t do just one. The thing is, they all work together. You need to have corporate marketing to attract franchises and grow the size of the brand. Then you need to have marketing for the franchisees because if they are not successful, neither are you.

It will also be hard to attract more franchises if your current ones are going under and not profitable. The additional marketing programmes also help a lot.

In some cases, you will have an owner who owns multiple shops or just one that wants to be a big spender.

If corporate offers these programmes through vendors, they get to have some control, provide more value to the owners and help grow the size of the brand.

Related: The Danger Of Being Franchisee No. 1

Corporate Marketing Programmes

When I say corporate marketing, I mean marketing just from the business-to-business perspective. Basically, you’re trying to attract more franchisees to the franchise. Here are some of the things to consider.

Have a location-based strategy. Almost all franchises have some kind of location element. That means all of your marketing strategy should be tied to location. On the corporate level, you’ll want to focus your efforts on the regions that you’re trying to build out first. When you do this, you need a good mix of online and offline marketing to build the brand and take the location by storm.

Consider the following:

  • Local SEO
  • Local Google AdWords
  • Yelp ads
  • Yellow pages
  • Local directories
  • Microsites or landing pages (there is a lot to know about this one)
  • Local content marketing
  • Social media ads and social media marketing
  • Radio advertising
  • Buy billboards in the area
  • Sponsor sports teams in the area
  • TV in the area
  • Direct mail
  • Try to set up a pipeline for your franchisees.

One of the main draws to any franchise is that there will be demand for business due to the brand credibility in consumers’ eyes. The idea is that the franchise is so established that when someone buys into it, the customers will automatically come.

Get on lists. Large business sites often have lists of franchise opportunities. In addition, people are constantly writing on the topic. Many of these lists are industry-specific, and will often state the best franchises to own at any given time. As part of the franchise-marketing strategy, it is a great idea to get on these lists. People read them often and they can drive a lot of business.

Get them into a funnel. People research franchise options heavily before purchasing one. There are a lot of options, price points, business models, set-up costs, etc. One of the most important things you can do is get them into a funnel.

Now, this can be some type of drip campaign using a tool like Infusionsoft or just a basic MailChimp email newsletter. Either way, you need to stay on their radar after you have captured their email and other actionable information.

While they might download your information packet at first, they might soon forget the franchise if this is not put in place. Keep in mind that getting them to be a part of your social communities or follow your blog can also accomplish this.

Make your brand glow. Not all of the marketing needs to be direct response. Keep in mind that people need to really like the brand.

They need to feel as though the franchise is greater than their current business. Or if they don’t have a business, that it is a great opportunity and sure-fire win in general. Invest in great creative, a nice website and plenty of positive marketing to make people proud to invest in a franchise.

Have a strategy to target similar businesses. This is different for every type of franchise, but one of the main ways some franchises acquire new franchisees is by going into a non-franchise business and doing a presentation about why they should switch over. This demands a great deck, plenty of supplementary marketing materials and a sales team. If done well, it is one of the most effective strategies for acquiring new franchisees.

Related: Should You Purchase An Existing Franchise?

Corporate Marketing Programmes For Franchisees

In addition to marketing to acquire franchisees and build the brand, it is also a good idea to have marketing services on the franchise level. Of course, it all depends on the franchise and the needs, and it will be highly targeted to the individual location. If possible, there should be one standard package and other larger packages that franchisees can contract directly for.

You will need a baseline programme. The baseline programme should be provided by the franchise, but it can come out of a franchise fund. Generally, franchises will vote on a marketing programme and budget at annual meetings. This would then get allocated to this programme.

The programme should be location specific. If it is online, that is a given, but if there are offline elements, such as billboard or radio, that also needs to be very targeted. Direct mail also needs to be highly local. The most important thing is to ensure you are delivering in the right markets based on the level of franchisees you have there.

You should have options to upgrade. When creating the options to upgrade, you want to make sure they are all somewhat affordable for the franchisees. Options should then be priced in a general range that makes sense across the board.

It’s a good idea to work with an agency that has experience. To build out this type of system internally is very tough, especially if you are a new franchise with a small team. You need expert and experienced personnel. In most cases, it is a good idea to bring on an agency with heavy local advertising experience and, of course, franchise experience.

Additional Marketing Programmes

Some franchisees will only own one or two franchises, but others will own five, ten or even more. When this is the case, the franchisee will most likely consider their franchises as their own business.

A franchise needs to have an agency they can trust to provide custom solutions to these types of owners. Make sure you have a solution for them that is dependable and can get them the results they are looking for.

Related: How Risky Is That Franchise?

Summing Up Franchise Marketing

If you are looking to attract franchisees, you need to have a clear and profitable model, a strong case for making the investment and serious brand credibility. If you do a great job with your franchise marketing, you will be well on your way to attracting new owners.

Entrepreneur Magazine is South Africa's top read business publication with the highest readership per month according to AMPS. The title has won seven major publishing excellence awards since it's launch in 2006. Entrepreneur Magazine is the "how-to" handbook for growing companies. Find us on Google+ here.

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Researching a Franchise

Maximise Your Social Media Reach This Holiday Season

Quick and cost-effective, social media is your best tool to reach target markets when it matters most – during the holidays.

Diana Albertyn

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It’s not just the end of the year that can be lucrative for businesses. School holidays and other major breaks during the year present consumers with more time to spend shopping. Why not ensure money is spent at your franchise by capitalising on the minimal cost and maximum exposure of social media?

You don’t have to create entirely new deals or promotions from what you may already have running on your store, but find a way to make it special for your social media followers, suggests Kelly Mason, marketer at Customer Paradigm.

Holiday campaigns on Twitter, benefitting from popular hashtags, streaming live content, and receiving information instead of just distributing it via social media are just some of the ways to stay ahead of the competition.

Related: Why Your Business’ Social Media Marketing Strategy Is Probably Wrong

Know your customers well

The first step to attracting customers and getting them to complete a sale is understanding their customer journey.

“Being able to document where they spend their time online, which social channels they use most, and what they’re reading or watching on those channels is a huge plus. Finding that crucial information is fairly easy to do, thanks to modern-day marketing tools and resources,” advises Paul Herman, ‎VP: Product and Solutions Enablement Group, at Sprinklr, a unified customer experience management platform for enterprises.

The better you understand your customers, the easier it is to reach them through a campaign optimised for their interests.

Master social listening

You could be using social media all wrong in the run up to all your holiday campaigns. Perhaps it’s time you used this platform to listen to your customers?

“Through social listening, marketers can identify major trends and product keywords in their industries,” says Herman. “For instance, knowing those keywords can help marketers identify which social platforms are more popular for a target audience. With that information, they can make smarter decisions about where to spend their money and which products or services to promote on each platform.”

Related: 10 Laws Of Social Media Marketing

Use the information gathered to determine what customers like about your product, what they dislike about it, and how you can improve upon it so they can buy more of it. The more of this data you collect, the better and more effective your interactions with customers will be.

Try something new

50% of consumers look for a video of the product they want to buy before going to an ecommerce store to buy it, according to a 2016 Google survey. “Video can be an extremely effective way to get your customers to take action – in this case, to make a purchase with your store,” adds Mason.

Video adverts are often used as an experimental tool in social marketing and switching it up on platforms such as Facebook Live, Instagram Live, Instagram Stories, or Snapchat – depending on your brand’s activity and your audiences’ interests – can help attract customers during seasonal periods.

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Researching a Franchise

Selling Your First Franchise? Consider These Key Pointers

You’re ready to franchise your business, but who do you sell to and how? Your first few franchisees may be the hardest to acquire, but the process will be smoother if you get some basics right.

Diana Albertyn

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Business experience gained running your independent brand will come in handy, but looking for franchisees is a different ballgame. “We have to attract the right people in enough numbers to make the difference; and, the key to more leads is to have a multi-prong strategy to marketing,” says franchise strategist and expansion expert Lizette Pirtle.

Using media (social, or otherwise), trained experts in franchise sales, and keeping in mind that whoever you sell to will become an extension of your brand, are important considerations before selling your to first franchisee:

1. Use (all) media wisely

Website marketing, print advertising and social media are just some of the many different ways to attract potential owners to your franchise. But the most cost-effect of the three may be a ‘tweet’ or ‘post’ away, says former Director of Marketing at the International Franchise Association and owner of Burris Branding and Marketing, Jack Burris.

Related: To Buy Into A Franchise Or Purchase A Licence? 3 Factors To Consider

“Three out of four people using the Internet are either on Facebook or LinkedIn or Twitter or all of them. Take advantage of social media,” he says.

“There’s typically no cost to play in the space except for the time that you need to invest to build your brand with a social media presence.”

2. Seek out franchise coaches or brokers

While this is a more traditional method of making reliable franchise sales, it’s a great way to form lasting associations that will take you beyond your first few sales. “Using broker networks is a great way to supplement your own efforts. However, you must spend time developing relationships with these people if you want to get results,” advises Pirtle. “Don’t think that just listing your opportunity with them is sufficient.”

Franchise coaches and brokers have multiple options for potential franchisees, so to put yourself high on their list of consideration when prospects enquire, you have to form memorable relationships.

Related: 3 Factors To Focus On When Opening Your First Franchise

3. Always consider the bigger picture

Out of all the people your marketing efforts attract, always keep in mind that few will check all the boxes and compromising could cost you in the long run.

“The franchise relationship is a long-term one. If you’re going to be successful as a franchisor, you should start with the attitude that every franchisee will be someone who you’ll have to live with for years to come. And nowhere is this philosophy more important than when awarding your first franchise,” says Mark Siebert, CEO of the iFranchise Group, a franchise consulting organisation.

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Researching a Franchise

To Buy Into A Franchise Or Purchase A Licence? 3 Factors To Consider

So you want to become an entrepreneur, but prefer support from an established brand? Franchising isn’t your only option, but is licensing right for you?

Diana Albertyn

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Opening a new business under a successful brand is a sure-fire way to success. Given that you’ve done your homework and the projections are looking good, you could be running a profitable operation in no time. However, the choice between buying into a franchise and purchasing a licence to operate under the brand, in exchange for a fee and portion of your profits can go one of two ways.

“It is essential to understand the difference between a franchising agreement and a licensing agreement, especially when seeking funding from a financial services provider,” says Morné Cronjé, head of franchising at FNB Business.

“Each business model is governed by a completely different agreement or contract and they operate in a unique way.”

Related: Should You Purchase An Existing Franchise?

When contemplating which option is right for you, consider how much independence you’d like to hold as a business owner, what kind of investment and share of the profits you’re willing to make and the type of relationship you’d like with your mother brand.

1Support vs autonomy

When toy industry behemoth Toys “R” Us filed for bankruptcy in September 2017, Toys “R” Us South Africa distanced itself from its US affiliates saying that the SA business is performing so well, it’s embarking on an expansion drive. How can the mothership be suffering while its SA counterpart is thriving?

Toys “R” Us SA is a privately-owned independent company operating under a license agreement with Toys “R” Us Inc. While the local version of the toy giant has purchased the right to use licensed material and intellectual property, the licensor has no control over the operations of the licensee.

With franchising, however, the franchisor exerts more control over the franchisee, but where the franchise lacks in autonomy, it makes up for in support.  “While entering into a franchise requires more of an initial investment, the benefits of an entire organisation supporting you are powerful,” say the owners of US-based fitness studio Barre Forte.

2Financial implications

While both franchisees and licensees pay an upfront fee and ongoing royalty payments to the owner of the brand or intellectual property – the franchisor or licensor – as a licensee, you bear the developmental cost and the risk associated with launching foreign operations.

Cronjé explains a franchising agreement as a duplication of a specific business model, governed or controlled through a franchise agreement where the franchisor holds all rights, including the business model.

“While franchise and license agreements vary significantly, looking at the cost distinctions between the two, it is generally more affordable to pursue a license agreement than a franchise agreement,” he says.

Related: Owning A Franchise – Good Idea Or Bad Idea?

3Relationship matters

The initial investment may be higher for a franchise operation, but access to a proven concept, an established customer base and ongoing product and service innovation could end up wing worth the cost. Not to mention the support franchisees get in the form of ongoing training and assistance with the initial setup process.

“When it comes to training, the licensing model would only train staff on the product they are selling,” explains Cronjé. “This is very different to franchising, where comprehensive training is provided on how to operate the entire business.”

Licensing generally includes some components of franchising, however what the difference is that specific operational support systems aren’t dictated by the group, which could bode well for you if you’re looking for the benefits of a big brand without the red tape.

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