Kate Elizabeth — 18 June 2019
Sometimes that support might come in franchisee sign-off of the platform, and there is no budgetary implication for the franchise adfund because the budget for the platform is coming from head office funds.
Sometimes that support might include Franchise Owners Advisory Council (FOAC) budgetary sign-off as expenditure from the adfund.
Sometimes that support might include finding additional budget from external partners to deliver the platform that benefits your franchisees' local area marketing efforts.
When you are planning the implementation of a marketing platform to support local area marketing, the most critical thing you need is the data. This data includes:
Which stores have a strong LAM presence and which stores aren't yet meeting network requirements for LAM?
Look at the pattern of LAM activity, their spend, their sales, what their ROI is, which channels they use, their consistency and their time in market.
Knowing this data will allow you to demonstrate the power of effective local area marketing to the network, using live data from successful franchise stores.
What is the volume of requests for custom local area marketing? How long does each request take to deliver? How many rounds of changes are usual before production is signed off?
If you aren't already tracking this information, put in place a tracking and measurement system so you cakn accurately record the true costs of producing LAM for the network.
How many times do your brand elements appear in your advertising?
Know the potential exposure of your brand throughout your network, for both national and local campaigns. Every visual identity element, whether it is your logo, your colours, your font, your imagery, contributes to the impression your customers and potential customers build of the brand.
How many instances of off-brand marketing appear throughout your network now?
Using your operations team, build an understanding of off-brand marketing and collateral throughout the network. Use this to build an understanding of the impact of off-brand collateral, the scale of local area marketing and your franchisees' willingness to drive sales, even if they aren't using the brand correctly.
The cost of doing nothing
What is the difference between a LAM-expansive store and a non-LAM store? Multiply this by the number of non-LAM stores - this is the network exposure to missed sales. What is the earning potential for a franchisee in either scenario? What is the impact to the brand?
Included in the cost of doing nothing is the:
The cost of employing extra people
Know the cost of employing an extra person or two to deliver the network requests for local area marketing collateral, at the level you would expect from best practice franchisees. Base-level salaries for a mid-weight graphic designer and oncosts are about $50,000 per year, for one design resource.
There would be a capped increase in support available to franchisees, a slight improvement in brand control, and, of course, the additional expenditure of ~$50,000 per year for one design resource that would always not be able to manage forecast workload.
The cost of implementing a platform to handle LAM production at scale
We have built an ROI calculator that enables you to run some figures to take to your network.
Once you have the data and understand the options, let's look at some ways to secure the support of the franchise network.
Don't leave a platform of this power, that requires franchisees to believe in it and use it, to be a 'tah-dah' moment at your next franchise conference. Bringing in crucial franchisees, or your FOAC early in the discovery and assessment phase will help ensure a smoother onboarding process.
Use their expertise and passion for your brand and their desire to grow their sales to prove the platform delivers a powerful local area marketing solution.
Can you fund a marketing platform out of your adfund, are there rules about what can be charged to the adfund? Some adfunds, for example, only allow for media placement to be invoiced to the fund and all other expenditure comes from a head office allocation.
If Outfit can be charged to your adfund, break down the monthly cost of Outfit per franchise and the amount, on average, that each franchisee contributes to the fund.
Perhaps you can cross-reference this with the volume of work that best-practice franchisees produce to support the local area marketing calendar and calculate the cost of producing artwork through Outfit versus the cost of employing designers to handle the volume.
One of our current clients produces, on average, 10 pieces of LAM collateral per location each month. For the head office to produce this volume of collateral, they would need to employ 3 full-time graphic designers!
Having worked in franchise, and with franchises, for years, we understand that adfunds can be restrictive and sometimes it isn't possible to pay for Outfit out of the fund.
Certainly, there are some head offices that see the value of Outfit and fund it from their budget, rather than the adfund.
Additionally, you may like to consider approaching some of your suppliers for co-op funding of the platform. Their brand benefits because their product is used properly, more local area marketing is produced, more sales are recorded and therefore more of their product is ordered. In this model, you don't have to put all your eggs in one basket, but could approach several of your suppliers to defray the cost of the platform if you really want it but the CFO hasn't allocated budget to this project.
The value of allowing easy network scale, easy on-brand local area marketing creation and creating empowered franchisees engaged in the success of their businesses creates a clear case for implementing Outfit with the support of your franchise network.