I recently read an article hypothesising that the brand era is over for franchises. The author believes that younger generations are less brand loyal and looking for a more unique experience than those offered by chains. The franchise strength then lies in the franchisor offering expertise in operational uniformity of systems and procedures, while the franchisee retains its own identity and basically does its own community based marketing.
As a former student of marketing, I find this tough to swallow but it did make me think. What does branding mean to consumers in this day and age and is it managed effectively in franchises? The field of marketing and branding is becoming increasingly complex with the advent of social media and the clutter in other traditional media. To stand out as a brand requires uniqueness and smart media strategies. We often come across franchises that struggle with this. Franchisees have more rights than ever to have insight into marketing spend because of the Consumer Protection Act. Yet brand building remains the responsibility of the franchisor and it’s tough to make the right calls all the time. However, there are some basic principles that can go a long way towards successful branding.
Consistency is critical in marketing
The starting point should be a well-defined positioning statement that clearly outlines who the target market is and what the brand values and personality entail. An ill-defined brand strategy results in ad-hoc campaigns that do more harm than good when it comes to brand building. The most successful franchises are also successful at consistent marketing messages for example Spur, KFC and McDonalds have recognisable and consistent advertising campaigns.
We believe one of the mistakes that franchisors make when it comes to marketing is to use the marketing fund for non-media and marketing expenses such conferences. Media is expensive and the bulk of the budget should be spent on the correct media. Another mistake is to launch ad hoc marketing activities and promotions. The franchisor should have a marketing plan for the year that includes both brand building and promotional activities and this should be communicated to franchisees so that they are ready to participate.
Local marketing is an essential element
Local marketing is an element in the marketing of franchises and the franchisee is usually best placed to know what works in their community. The franchisor should provide a clear corporate identity manual as part of the operations manual and should ideally approve all campaigns to ensure brand consistency.
The one element of branding that is not always recognised as essential is training
A clever marketing campaign is useless if the in-store experience doesn’t back it up. The only way to achieve this is through persistent training. As with the marketing plan, every franchise should have a training plan for the year and re-training is also essential. Starbucks spent more money on training than marketing when they started out and is now a successful global brand.
So what to do about the move towards customisation and artisanal product offerings?
I believe a brand like Tasha’s is quite good at adding a local flavour to its franchises with store specific menus that create that feeling of localisation for the customer. Another buzz word is mass customisation and this is evident in the new category of gourmet burger chains that proliferated in the USA where customers can build their own end product. Franchises don’t have to be plastic and boring, there is much room for adding local flavour and quality offerings to differentiate an outlet in the market in which it operates. For service and retail franchises, they key lies in excellent customer service on the floor and after the sale. Many customers prefer supporting their local hardware store over the big chains as they know that individual service is more likely at these outlets.
Finally, I don’t believe that the brand era is over. However, I do think that many franchises need to pay more attention to brand and marketing strategies in an environment that is ultra-competitive and economically challenging to benefit both the franchisor and franchisees.
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