How a Digital Agency Can Help Your Franchise Marketing Team Leap (and Sleep) – Part 1

We’re thrilled to welcome guest author Drue Townsend, CEO at An Outside View Consulting and veteran marketer with over 30 years’ experience in franchising, to the Location3.com site to provide her incredible insight and franchise marketing expertise. In this initial three-part blog series, Drue outlines the top ten ways the right digital marketing agency can help you move your franchise business forward (and allow you and your team to get some sleep).

If you are like other marketing leaders, your role is ever-expanding. Whether you are developing new strategies to create revenue-generating leads, reviewing new marketing software tools, executing a new initiative launch, or communicating last months results to ownership, you likely have a limited number of supporting team members, and limited funds to hire and train additional people. While no one on the outside will know your business as well as you and your internal team, working with external marketing agencies can quickly extend your team’s bandwidth, and as importantly, their knowledge and expertise. One type of external partner – a digital marketing agency – can actually provide quicker, more measurable results than many other types of agencies because digital campaign components can be tracked – with results available in real time and often viewable in shared portals. A digital marketing agency that understands franchising and understands the roles of Franchisor and Franchisee, can add even more value.

Most digital marketing agencies offer a variety of solutions from strategy development to data science, to media planning and technology consultation, with fee structures (ex: project fees, fixed monthly retainers or percentage of spend fees) based on the specific contracted engagement, making it easier to prioritize efforts based on strategic initiatives and extend to more as the needs, budgets and relationships grow.

In part one of this three-part series, we’re going to focus on three core areas: Strategy Development and Extension, Competitive Analysis and Budget Planning & Recommendations

1. Strategy Development and Extension

Most Franchisors have a big picture plan, but some lack clearly defined strategies and tactics needed to achieve success and prevent siloed departmental executions. The strategy should contain components for both brand and local Franchisee marketing, as well as for selling franchises (although the budget sources and executors are often different for brand/local marketing vs. selling franchises).

For example, how will the company increase royalty sales by 10%? How will a decrease in Franchisee satisfaction be addressed by cross-departmental initiatives? How will new legislation in your industry impact how Franchisees serve their customers or how you support them?

Tactically, what happens when growth opportunities are targeted for certain regions, but cost- per-leads are less in other regions? Do we pause spending marketing dollars to make the phone ring in certain areas if the wait time for call pick up is causing prospects to hang up, be angry, and post negative comments in social media?

A strong digital marketing agency will help you look at both your corporate and marketing objectives to see where digital marketing can contribute to their achievement, as well as create new areas of opportunity. If an integrated strategic plan doesn’t exist, a proven agency will help you create one specific digital marketing (or can take it up a level and help you create a full-blown marketing plan covering broader objectives, mediums and initiatives).

2. Competitive Analysis

While it’s relatively easy to gather basic information about your competitors by doing website searches and leveraging some standard third-party toolsets, it takes time and digging to find and read reviews and articles, search social media sites and to experience the process of being a prospect of a competitor. What is even harder to learn without the proper tools is how those competitors are performing online. How much money are they spending on online marketing? What is their share of search space? What search terms are they outranking you on and where do you overlap? What is driving ad costs up in specific local Franchisee’s markets? How much should you be spending to be up 24/7 on certain terms? What could you be doing to improve your online presence against specific competitors? Is their website loading faster than yours?

Your digital marketing agency offers the advantage of access to many different tools and resources to create a competitive profile that can help you understand competitors better, and puts you in a better position to develop or modify your marketing strategy, tweak messaging in content or maybe even test new mediums or ad formats.

3. Budget Planning & Recommendations

If you are like the majority of Franchisors, most – if not all – of your non-Franchise recruitment dollars (meaning dollars spent on brand and corporate-level marketing tools and initiatives to help Franchisee’s grow and support their local business), comes from the required marketing and advertising fund contributions paid by each Franchisee as outlined in their Franchise Agreement. Some Franchisors also require Franchisees to spend a specific percentage of sales or a monthly dollar amount on local marketing activities.

While the combination of these two types of funding may appear to create a large budget to a franchising outsider, an experienced digital marketing agency understands how far those dollars must go, covering things like the website and app upkeep, data management and analysis, email marketing enterprise platforms, marketing research, creative development, brand advertising

and more from the corporate ad fee side, along with local marketing and advertising expenses that could include a variety of mediums such broadcast media, outdoor media, digital media, promotional media, social media, networking, and others.

In addition to knowing the corporate and marketing objectives, and understanding the sources of revenue, your franchise digital marketing agency should consider two other important financial factors – the Average Unit Volume (AUV) of start-up, growing, mature and other classifications of Franchisees (and the number of locations) to help inform budgets and provide specific spend recommendations and tactics.

A Franchisor with 200 locations and an average AUV of $600,000 that collects 2% of gross sales annually will have a total marketing budget of $2.4 million dollars. A Franchise in this same system has an additional 3% local spend requirement, so achieving $600,000 in annual sales creates a local Franchise spend requirement of $18,000 for this particular Franchisee.

An experienced digital marketing agency will ask the right questions and understand that recommending a local digital marketing spend of $1,000 -$1,500 a month will not be reasonable for a large part of this franchise system unless the corporate budget is adding dollars to individual Franchisee campaigns, paying for all of the brand marketing, or paying for the agency fees, AND the Franchisee has no other local marketing expenditures needed in other areas. Bottom line: only a portion of the Franchisor plus Franchisee marketing budget can be allocated to digital marketing, and there are a lot of initiatives vying for those funds.

Setting reasonable budgets for both the corporate campaigns and the local Franchisee campaigns helps your team and the agency gain credibility with the Franchisees, as well as helps ensure that paying for digital marketing won’t be a burden for a Franchisee who might then cut back important spending in other areas. Corporately funded campaigns can be incrementally increased as more locations are sold and begin contributing to the Ad Fund, and Franchisees can choose to increase their spend as their AUV’s increase and they see tangible results from the campaigns.

In Summary

Partnering with the right strategic marketing agency is the catalyst your franchise business needs to achieve sustainable growth. By providing comprehensive strategies, data-driven insights, and expert support, they become an indispensable extension of your team. As you sleep soundly, they work tirelessly to propel your franchise marketing forward, unlocking new opportunities for success and growth.

Stay tuned for Part 2 of our blog series, where we delve deeper into the value of strategic marketing agencies in transforming your franchise marketing endeavors.