COMMON QUESTIONS IN MARKETING

When you buy a franchise you’ll be investing in a business with marketing support. What exactly does that mean?

Get the basics under your belt.

As franchisors we are presented with many, various questions from prospect franchise partners who are in the process of researching and doing their due diligence. This process is very important as it paints a clear picture of the partnership you are about to embark on with the franchisor and vice versa.

There is a lot to consider, and how you will market the business is one aspect.

The marketing side of business is a vital ingredient that will contribute to your success. Here are the most common questions answered when it comes to marketing within a franchise business model.

QUESTION #1

I know nothing about marketing. Does the franchisor provide marketing and advertising support?

Yes, absolutely. It is in the franchisor’s best interest to train, support and give you the resources that will contribute to your success. The majority of franchisors will have an induction or onboarding training

period in which you will learn the ins and outs of your franchise business, covering every single component such as operations, HR, sales, etc. Marketing would be one of these. During this time you will learn basic marketing strategies relevant to your business. While you won’t need to know how to develop a complex 100-page marketing plan, you should be able to understand basic marketing principles, local area marketing tactics and the importance of why you need to conduct your own marketing in your community.

Ongoing support the franchisor should provide includes small-group training, workshops, an online marketing asset library, conferences, etc.

QUESTION #2

Why do I have to do my own marketing if I’m part of a franchise model? Doesn’t head office take care of it all?

This is the biggest misconception when it comes to franchising – that when the franchise partner purchases their business, they are relieved of this important practice and the franchisor will “take care of it”. This is not true. Becoming a franchise partner is about leveraging a proven, existing, successful business model and introducing it to a new community. This includes the brand, systems, procedures and reputation. It is then up to the franchise partner to launch, develop and grow that brand within their local area.

A common term you hear in franchising is “local area marketing” or LAM. This is an essential component in developing a successful business. Local area marketing must be conducted by the franchise partner in order to grow new relationships and draw attention to your business in your community. While the franchisor will most definitely assist you with this, it is up to you, the franchise partner, to get the brand out there and get people buying from you.

QUESTION #3

How do loyalty and marketing fees work? Why do I have to contribute to a marketing fund if I have to do my own marketing?

This is a very good question. Every franchise system is different and will have different royalty percentages or licence fees depending on their model.

It is common for the franchisor to take anywhere between 5 and 20 per cent of your gross revenue and there can be many other fees such as equipment, shop fitout, training, legal fees, marketing and so on.

The marketing fee that franchise partners contribute to is to support national marketing activities that the entire franchise network benefits from. This is to create brand awareness that will strengthen the brand for everyone across the board. This investment usually covers marketing activities such as campaigns, TV, radio, digital, etc. Every single franchise partner contributes to this and benefits from this fund. It is also important to note the franchisor legally cannot skew the spend towards one particular state, territory or partner.

QUESTION #4

Do I get any input into the overall marketing of the business?

Typically no. Head office or the national support office will have a marketing team in place that will strategise and develop national marketing plans they believe will benefit the brand and entire network of franchise partners. These marketing plans are communicated in various ways depending on the business, but typically include conferences, presentations or events.

Any good franchisor or marketing team will welcome marketing ideas from the franchise partners. While in most instances the franchise partners don’t have a lot to do at a national marketing level, they will be able to give feedback and collaborate on ideas that affect their local area marketing.

Finally, marketing is a vital ingredient in building any business. If you are not confident in building brand awareness and building relationships with your community, ask the franchisor how much assistance and support you will receive in this area. Investing your time and energy in this area will result in success. Effort always equals reward!

Kelly Nikolakopoulos heads up marketing at Sport Star Academy. The franchise is a leading provider of skills-based sports programs for children.

If you are not confident in building brand awareness and building relationships with your community, ask the franchisor how much assistance and support you

will receive in this area.