The franchising model has a truly staggering number of benefits. Low cost, high national audience, local knowledge and expertise and a low barrier to entry for small businesses all contribute to making the franchise one of the most popular business models in the world. However, it does have its challenges. Today, we’re going to look at one aspect of the franchisor-franchisee gap: local marketing.
The lay of the land
Let’s look at the nature of the problem.
The broad marketing framework for franchises works like this: At a national/international level, marketing is about brand awareness and value. It’s not about driving customers to a specific store, but rather about raising the profile of all stores across the franchise network.
At a regional level (e.g. country/state) the objective gets a little more focused. A franchise advertising co-op might focus on driving business to stores in their region. Product features and benefits begin to play a more important role.
Then, at a local/individual franchise level, the goal is to get people to buy – to get them into the store and spend money. Coupons, pricing discounts and giveaways are common tactics.
The problem: content/collateral production
The problem is that traditionally, all collateral was produced at a national level and distributed to local franchises.
That’s an issue because, local audiences expect local marketing, and local marketing has evolved into hyper-local marketing.
Essentially, national and regional organizations no longer have the insight or capability to produce compelling local campaigns. Messaging, collateral production and tactical execution need to be completed at a local level.
Which causes some serious headaches:
- Local franchises are historically not very good at working together
- Local resources might be lacking
- There’s an issue of control — national-level executives want all marketing to be the same, but local franchise owners are incentivized to maximize sales (even if it means parting with national brand objectives
Overcoming the disconnect
So that’s the issue: national brands are no longer capable of delivering effective local marketing, but local franchises are unable to operate on the same level as national brands.
Fortunately, the franchisor-franchisee disconnect can definitely be overcome.
First, national brands need to get better at leveraging local initiatives, even if that means loosening the brand reins a little. Corporate investment in marketing expertise that’s distributed at a local level (e.g. a marketing executive who travels to local franchises and helps plan local campaigns) is a good start. This way, national brands can best leverage local knowledge.
Second, local franchisees need to start working together to pool their resources. Things like advertising as a group can help achieve greater results than going it alone, as well as solve the problem of conflicting local messages.
Third, national brands need to rethink what their role in marketing and advertising is. With the focus on digital technology and hyper-local messaging, national brands need to reposition themselves as infrastructure providers rather than content providers.
For instance, imagine KFC wanted to build an app. Local franchises can’t afford that, but national brands can. They should be focusing on building a great app and experience, but leaving the content and promotions inside the app to local franchises who fill it with relevant, targeted hyper-local campaigns.
The world of franchisor-franchisee marketing is always evolving. The traditional structure of national, regional and local advertising, while still relevant, needs to change. At a national level, the focus needs to be on driving brand awareness and providing the digital infrastructure (the container, if you will) for regional and local initiatives. On the local level, franchisees need to engage more with marketing initiatives, spending more time and resources to fill the gap left by awareness-centric national and regional brand campaigns. Working collectively can drop the cost of these efforts and, ultimately, drive better results for everyone.
Ready to explore local marketing for your franchise? Give us a call.