Checklist to Understand Marketing Benefits of Franchise

In the post about benefits of buying a franchise versus independent business we argued that one of the primary benefits provided by franchise is better marketing at a lower cost. By leveraging their size and expertise a franchise can create better brand and improve sales for all franchisees. Subway positioned itself as the Diet Sandwich Shop in the minds of all Americans by running the “Jared” campaign for number of years.

However, not all franchises do such a good job of marketing. A number of them waste their and franchisees’ money by spending on frivolous, useless marketing activities. That’s why it is important to understand the value provided by franchise in terms of marketing and compare it against the investment you have to make as a franchisee – in other words the return on your marketing spend.

There are several aspects of marketing you need to be aware of to understand the marketing benefits provided by franchise. We have provided below a checklist of questions you need to ask the franchise and other franchisees to explore from all angles the marketing plans of the franchise and value provided to its franchisees. The questions are categorized in several buckets to ensure all marketing angles are covered.

Marketing Contribution

  • How much is the marketing / ad fund contribution per month?
  • Are all territories required to provide the same contribution?

Marketing Techniques

  • What are the different marketing avenues franchise uses – television, radio, billboard, newspaper, Internet?
  • How does the franchise web site look vis-à-vis competitors? Does the web site have support for customer ordering, menu, coupons, nutrition information, etc?
  • Does franchise have mobile application strategy?
  • What types of customer loyalty programs has franchise launched in the past – gift cards, frequent purchase, etc?

Local Marketing Support

  • How does franchise divide marketing budget between general (nation or region wide) versus local (territory wide) marketing?
  • What support does franchise provide for local marketing specific to individual stores such as marketing brochures, group purchasing, etc?
  • Does franchise provide support in terms of obtaining and analyzing customer database?

Franchisee Input in Marketing Decisions

  • How much influence do franchisees have in important marketing decisions?
  • Is there a marketing committee comprised of franchisees to provide input into marketing decisions?
  • Does franchise seek approval / input from franchisee before launching major marketing campaigns?

Brand Value

  • How is the franchise brand perceived in the minds of customers?
  • Does franchise introduce new products / marketing campaigns periodically to maintain its brand’s strength?

Of course, marketing is not the only area you want to look at when making a decision to get into franchise. You need to understand all aspects of the franchise operations. We have covered this in earlier posts on 10 questions to ask franchise before buying and understanding operating requirements of franchise.

What do you think? How would you evaluate the marketing power of a franchise before making your decision?

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