Local Marketing in the Franchise Industry

March 1, 2013 Jared Shusterman

The IFA Annual Convention was last week in Las Vegas. I’ve always had a love/hate relationship with large shows like this. On one hand, I love my job, and it’s exhilarating to spend a few days with tens of thousands of people who share your passion about something. Plus, conventions give me a chance to reconnect with old friends I would rarely see otherwise. On the other hand, you’re talking about days of non-stop running where sleep is something you somehow forgot to pack.

The IFA Convention was no different; I came home exhausted, drained and completely psyched about marketing in the franchise industry. Even more so than many of our clients, local marketing is critical to the business model since local businesses are the exclusive distribution channel. Think about it; you can’t buy a Whopper® online. If done correctly, the opportunities are boundless. If done incorrectly, it can hurt both the franchisor and the franchisee.

For most franchise clients, marketing efforts are funded through two sources, National Marketing Funds and Local Store Marketing Funds. Despite the fact that money from these local funds can be spent in a wide array of expenditures, including technology, creative, content, etc., and despite the importance of reinforcing national messaging on a local level, there was one resounding concern I heard over and over at the show; “Franchisees don’t use what we give them.”

The reason? Let’s be honest; most franchisees are not “self-service” marketers. When faced with constraints of time, know-how and local-level resources, they aren’t going to spend hours at a computer administering their marketing plan. They’re going to spend that time running their businesses. When left to the efforts of franchisees, local marketing efforts have a tendency to fall flat, leaving franchisors trying to carry the load themselves.

So what’s the fix? Given that we’re a technology company, we believe the only way to efficiently run a local marketing program is through an intelligent, integrated technology solution that is manageable, trackable and scalable. But as I’ve said before, technology is merely a tool. It enables us to support a diverse and distributed marketing channel with specific local needs, but it is not a cure-all. It does not, on its own, solve what franchisors are telling us is a major problem.

To run an effective local marketing program for franchises (and by the way, this applies to most decentralized or distributed marketing initiatives) the end-user in the channel needs a dedicated resource, a local marketing coordinator walking them through the marketing plan, what needs to be done and how expending the time, money and effort will ultimately benefit their business. This marketing coordinator needs to be charged with:

  • Developing a comprehensive local marketing plan that is proactively strategic, not tactically reactive
  • Ensuring that the local marketing plan is being executed successfully and on time
  • Collecting local-level intelligence through both analytics and on-the-ground feedback
  • Explaining what's learned to the franchisee and adjusting the local marketing plan as needed

Going back to the IFA Convention, I was encouraged by the revived focus on local-level marketing. In the roundtable discussions throughout the show, any number of topics related to local marketing were discussed and debated. It was energizing to see industry leaders actively engaging each other on important issues. And I, for one, am not content with the conversation taking a lull until the next big conference.

Over the next few months I’ll be writing my own views on each of the relevant local marketing topics discussed at the IFA Convention this year, but I don’t want this to just be a monologue. I invite, and even challenge, you to join the discussion.

Let’s keep the conversation going.

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About the Author

Jared Shusterman

Jared is the Chief Executive Officer of SproutLoud. Since 2006, he has been primarily responsible for strategic direction of the Company, as well as the oversight of SproutLoud's Partner ecosystem. Prior to SproutLoud, Jared worked in Thomas Weisel Partner’s internet and online advertising investment banking practice in San Francisco. He served as the lead analyst on a number of Corporate Finance and M&A deals including Newscorps’ buyout of Intermix Media (Myspace.com). Jared graduated with a B.A. in Finance and Marketing from the McIntire School of Commerce at the University of Virginia. Jared has an MBA from the Kellogg School of Management at Northwestern University and is a member of the Young President's Organization (YPO). Jared has been honored as one of the Top 40 Under 40 Entrepreneurs by South Florida Business Journal and a Top 50 Entrepreneur by Business Leader Magazine. Jared lives in South Florida with his wife and two sons.

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