Compulsory centralized marketing programs are one of the greatest benefits of franchising. Gathering cash from all the parties involved gives them a better collective marketing strength. bigger advertising firm can be contracted to run better adverts with the larger collective funds.
But grievances can also arise, as most times franchises involved often get the impression that the pooled resources are not used diligently. This can cause a serious disagreement between franchisees and the franchisor, especially in bad economic times when they feel advertising would not be as effective. If you are considering investing in franchise marketing, it is important that you understand the firms marketing strategy. These are 5 basic criteria to consider;
Does it attract clients
You should inquire if the marketing funds drives enough customers to run the business successfully, if true, disagreements will be kept at the barest minimum. If the answer is no, then there would be a major problem
Does it involve the franchisees
Be sure that your opinion would count as franchisees, though most of the major decision are made by the franchisor, other parties involved should be allowed to air their views and be involved in the decision making. You should aim to join a franchisee advisory group where the firm’s executives hold meetings periodically to discuss matters and decisions.
If the sharing formula is fair
Cash for advertising are used for three basic things, 1. Cover the administration fees (agency fees, internal expenses), 2.they cover the cost of materials used for advertising (online ads, radio, flyers) and lastly, they pay the media houses to place these adverts for the purpose of benefitting the franchisees involved. Disagreements arise as to how the funds should be split. Also, marketing executives tend to favour and spend more funds on “brand-building” than advertising for “customer attraction”, franchisees are usually at logger heads with marketing executives on how this money should be split. As they believe a considerable amount should be spent on the latter.
Contact Existing Partners
One sure and effective way to make sure their marketing programs is effective is to get on the phone and start asking the existing franchisee. Find out if they are contented with the way funds are shared and if they are involved in the major decision making. Chances are that if they are happy with the franchisor, that it would be a good move to join in too.
Take your time and weigh your options when choosing a franchisor to invest in. This is no small matter, since your livelihood will rely on the success of the marketing program in driving customers to your business.