Brand management for franchise
Kate Elizabeth — 27th February 2019
Brand management for a franchise is best suited to someone who has outstanding marketing knowledge, an ability to influence stakeholders and draw upon empathy to achieve the best result for the network.
Brand management and marketing for a franchise traditionally involves building and balancing three types of brand positioning:
franchise marketing - positioning the brand to be attractive to prospective franchisees
national/large scale campaigns - driving awareness, enquiries and sales through universal campaigns
local area marketing - agile marketing positioned in the franchise location's local area
Three key stakeholder groups
Within a franchise, there are three key stakeholder groups to be considered when looking at brand or marketing-related activity and decisions.
The franchisor will have a national (or international) growth strategy, and the brand and marketing framework will need to support this. Their focus may be on rapid growth in existing markets, opening up new markets, increasing sales in existing stores, flipping company-owned stores or all of these. The franchisor will be looking for a solid brand framework to drive and convert enquiries for new franchises, and a level of marketing to drive sales growth in existing stores.
Individual franchisees within the network will have an individual understanding of, and interest in, brand and marketing. They may have an existing knowledge of this space, they may need upskilling, they may have no interest in, or opinion of, the minutiae - they just want footfall or leads to convert to sales.
FOAC or FAC
A Franchise Owners Advisory Council (FOAC) or Franchise Advisory Council (FAC) are elected franchisees who represent the franchisees in important decisions. The group meets with the franchisor, contributing to strategic and operational conversations about the brand, product, promotions, pricing. They bring both their frontline, in-store knowledge and often have regional responsibility, representing franchise groups in specific locations.
The complexities of a franchise environment
The franchise environment is undoubtedly one of myriad complexities - it is effectively brand management in a decentralised environment. Each franchisee has different prior experience when buying a franchise. Some of the franchisees I worked with in one franchise were serial franchisees; others had been ATO employees, engineers, accountants and professional athletes.
Each franchisee brings very different backgrounds and expertise, and they are united in the franchise needing to produce enough profit for them to draw a wage (at minimum) and support their families. For most franchisees, they are looking at this business providing more than a wage - they haven't invested hundreds of thousands of dollars, in most instances, to barely cover their living expenses - this is their livelihood, and we need to demonstrate we understand that, and deliver a brand and campaigns that drive sales.
The diverse backgrounds of your franchisees mean that, as a brand and marketing manager, you will need to upskill and educate your franchisees to varying degrees about brand and marketing strategy and operational execution. The knowledge we now have, and use without thinking, often seems like an odd combination of dark arts and silver bullets to franchisees.
Education of franchisees
Our responsibility is to ensure we empower franchisees through education about what we do, why we do it and the results it delivers to them. Educating franchisees can occur both formally and informally:
- Onboarding training - when a franchisee starts, run an induction for them and their staff, outlining what it is the central marketing team does, what they can do for local area marketing (LAM), how the Adfund is distributed and managed, how they access marketing support and what the expectations are for each side - marketing and franchisees.
- Promotional communication - send out communication with each new promotion outlining the brand and marketing activity, expenditure and how it will drive traffic.
- Quarterly updates - use these updates to provide more in-depth updates on the strategy and do a deeper dive into brand and marketing executions you use, e.g. Net Promoter Score (NPS); database growth and acquisition.
- Store visits - when you or your team are in store, take the opportunity to do some more in-depth training and answer brand and marketing questions they have in a one-on-one setting.
- Wiki/intranet/single source of truth - use your internal communication platform to host, not just information about your brand or your promotions, but in-depth videos and explainers about crucial marketing concepts.
Everyone is different, and in that, they are all the same
The most common comment I heard from franchisees is that their location is 'different'. This was a comment used to explain why their results were down on the target, why a specific promotion wouldn't work, why they need to run their own race and use the brand in a different way than mandated by you as the brand manager.
Each store certainly has differences, but there are things at the core of the brand that means franchisees should be compliant. Some locations might be in shopping centres and others, street locations. Some locations are metro and other regional or even rural. Some products might sell more in one location than another because of differences in audience, and some locations might be large and others small. A good brand manager doesn't ignore those differences but instead harnesses them around the common brand elements.
The vision for the brand remains the same, the ideal customers and personas stay the same, but might combine in different ratios in different stores. A regional location might have more families purchasing, and an inner city location might have more DINKs purchasing, but they are buying the same products.
The brand values remain the same, and the brand tone has a central essence, that might be tweaked depending on location and audience expectations. Communication might be more structured in some Asian countries and less formal in Australia.
Franchisees might vary their product mix outside the core range based on their location. Hobart needs less warm-weather products than Cairns, for example.
Within the franchise, however, there will be options for franchisees to choose from - they can still be compliant to the brand and deliver the variations their market and location demand.
Everyone is different, and in that, they are all the same.
National Spend vs LAM Spend
Depending on your franchise agreement, there will be several fees expected of franchisees, including franchise fees, marketing adfund contributions and local area marketing spend.
As an aside, since the new compliance requirements were introduced with the 'new' Franchising Code of Conduct on 1 January 2015 many systems have already abandoned asking for separate marketing fund contributions from franchisees, and 'franchise fees' will cover national, or central, marketing expenditure.
The brand and marketing spend can often be a point of contention between head office and franchisees. Depending on the budget available around which to build a marketing plan, metro areas can have less advertising because of the cost of mass-market placement, compared to regional areas with cheaper tv and radio rates, for example.
Franchisees may determine they see less benefit from the national spend and pressure the central brand and marketing team to allocate adfund expense to LAM in their area. They may feel that LAM investment authorises them to do what they like, regardless of brand guidelines, marketing plans and customer responsiveness.
Good brand management for franchise means you have transparency about your national expenditure and involve your FOAC in your planning process to actively seek franchisee feedback, hopefully minimising any pushback from the network. Providing regular updates and visibility, not just through the audited statement, is vital to grow trust in your strategy and your team.
Campaigns and adfund distribution
Much of your adfund budget will be allocated to national campaigns - producing and placing these to support enquiries, traffic and footfall for your locations.
In your campaign planning and asset production, consider how the assets can be customised and tailored to suit LAM execution. Taking this approach will help you ensure franchisees are on-brand and compliant, and also ensuring they see value in the assets because they can use the appropriate ones at a local level.
Most franchise agreements allow franchisees to ask for details around adfund distribution at any time, so it is important your tracking, accounting and reporting are up to date, so you don't need to spend days pulling together the information.
Ensure your campaigns are created and communicated well ahead of time to allow franchisees time to prepare for campaign setup, support it with LAM and follow-up if they haven't received the assets. Again, use your FOAC to get feedback on your campaign calendar before you implement it.
Creating campaigns that can be anniversarised also allows you to maximise your adfund spend - if your sale POS and assets can be used several times a year, or a couple of years in a row, it allows you to spend more money on placement rather than production.
Expanding the franchise network through new franchisee recruitment
The stronger and more well-known your brand, the more cost-effectively you will be able to deliver on franchisee recruitment. This is a crucial outcome for effective brand management for franchise.
The Franchise Manager often drives franchisee recruitment, but the brand and marketing team support the marketing awareness and lead generation strategy. When building your recruitment plan, these considerations are important:
- A healthy franchise recruitment presence on your website - outlining the offering, the benefits, the purchase process and who to contact is vital.
- Developing a marketing plan using referral channels not just advertising channels - including business brokers, franchise channels and publications and PR will complement your mainstream advertising, ensuring you are building business brand awareness outside your customer channel.
- Play the long game - it is a very different, niche audience who will be in the market to buy a franchise, and generally, the lead cycles and path to purchase are long. You may need to be in market, in different places, with an always-on strategy.
- Map the customer journey - just like you would for your end-user customer, map the customer journey for potential franchisees so you have an understanding of what nurture cycles to put in place and what content to serve to progress the lead.
- Define the marketing benefits of being a franchisee - understand your value proposition for new franchisees and reinforce this with processes and support to make it easier for them to become proficient in marketing.
Brand, branding and visual identity
Your brand, branding and visual identity need to be positioned for your customer and successfully translated, so your franchisees understand how to bring your brand to life in their location.
In non-franchise environments, there are often fewer opportunities for non-brand and marketing experts to use the brand. In a franchise environment, the use of the brand is spread throughout the network and will be applied to varying degrees. There will be a much greater emphasis on the balance between brand and ease in a franchise environemnt than a rigorously controlled company environment.
Onboarding your franchisees and educating them about the brand, the branding mechanisms used throughout the network and how to apply the visual identity is essential. It is not as simple as sending a link out to your brand guidelines and then providing rigorous feedback in the approval stage - this engenders frustration on both sides. Empowering them with tools, templates and platforms will help to increase on-brand execution and reduce frustration and brand dilution.
Ensuring brand compliance throughout the franchise network
Brand management for franchise often appears to be a big stick if not managed well as it usually comes down to compliance with the brand guidelines and marketing strategy and framework. Remembering that most franchisees aren't marketing experts and are desperate to achieve sales, they may be willing to do things with the brand and visual identity that aren't compliant and dilute the brand.
Being realistic in your brand management is an awkward position for most of us detail-oriented, brand-building advocates, but unless you have a better scaleable solution, sometimes you might need to let things go through at 70-80%. I can feel you cringe now, but with a large and dispersed network, with franchisees in different financial positions, with a budget and FTE to support national campaigns but not LAM for each franchisee it isn't always possible to do, or enforce, perfect.
Most franchise networks don't have sufficient design resource to design every single marketing and advertising element each franchisee needs, and therefore rely on guidelines, examples and rudimentary templates to support LAM and increase compliance.
Franchise systems for marketing
Franchises often use mandated or recommended systems to support the core components of the franchise. For example, the POS and payment systems are usually common; the franchisor might recommend a specific accounting platform; the network might have common suppliers for printers and transport.
A good brand manager also looks at specific franchise systems for marketing - this might be anything from ad-serving platforms to intelligent template and artwork creation platforms like Outfit. These platforms help increase compliance, customisation for LAM execution, the scalability of effective marketing and the value of the franchise system to potential franchisees.
By making it easier for franchisees to be compliant through franchise systems, you empower them to drive sales on-brand and reduce the amount of time you and your team need to spend in approvals and managing expectation.
Communication is key to grow trust
Brand management for franchise is complicated, and stakeholders with vastly different expectations and desired outcomes mean you need to be an adroit people manager, communicator and disciplined in process development and execution.
The best rule of thumb for brand management in this environment is communication and transparency. Demystify what marketing is, build a brand and marketing plan that focuses on sales and not just awareness, practice empathy and keep open communication channels with your franchisees.
The network and revenue will grow when you approach brand management in this manner.
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