Franchise Industry Balloons Through Local and Global Outlooks

Posted on October 15, 2014

franchise industry balloons

In 2014: Where is the Franchise Industry?

With the advent of online hiring, digital advertising, and mobile marketing, franchises have had to rethink their identities in a rapidly expanding digital landscape.

So how have they changed?

Of course, they’ve become more global, opening stores in multiple countries. Yet, paradoxically, the franchise industry is also becoming more local: local food, local employees, local SEO, local talent, local markets.

In fact, slowly, subtly, but surely, franchises are becoming local businesses with a global outlook. 

If this is new to you, stick around. Let’s look into this complex relationship between the local and the global.

 3 Ways Franchisors Train Franchisees for Global Outlook.

First, let’s look at the global outlook.

In the past, franchisees had the vibe of a local small shop. They appeared to have nothing “corporate” about them.

But as the franchise industry grew, and as corporations developed a global eye, franchisors set up infrastructures for their franchisees. Now, franchisees follow processes and procedures to ensure they emulate the original franchise model.

These models help franchisees look globally. Take, for instance, these recent strategies:

1. Talent Seeding.

Franchisors are now training eager franchisees through “talent seeding.”

With this program, corporate employees visit franchisees, working one-on-one to help the franchisees hire, manage, and enforce processes and procedures.  Thus, corporate employees “seed” talent throughout the franchise industry.

With talent seeding, franchisors broaden the perspectives of franchisees. Because they want more stores to open, franchisors enable franchisees to see past their location, past their region, indeed, past their state. In effect, they start to see globally. Or, at least that is the goal.

2. Social Media Marketing.

Franchisors now also aid in global outreach by working with franchisees to take advantage of social media.

Social media allows franchisors to generate the feedback needed to improve not just individual franchisees but the franchise at large. Again, the goal is to look globally: how can we improve our franchise model, our brand, our image? 

3. International Markets.

Franchisees use local knowledge to become the market leader, building the brand through local relationships.

Because of this, larger companies and concepts are no longer entering foreign markets first, as was the case in the past.

No, now franchisees enter communities with the intention of localizing and growing. These communities can be anywhere—Paris, Berlin, Rome, Atlanta. As franchisees localize, that is, as they familiarize locals with the franchise, the franchise expands in that region. Thus, localization enables globalization. 

4 Ways Franchisors Fund Local Advertising

So because franchisees localize, they expand beyond regional borders. But how exactly are they localizing?

1. Improves the Franchise Agreement.

This creates a single national-local fund that focuses in on the local level, where the money is made. The new advertising program assists franchisees who don’t have the tools or capability to market themselves with the local advertisement dollars required by their agreements. With this program, franchisees will be given the satisfaction that the advertising contributions they provide through royalties are being spent on them and in their local markets. To the fuel the program, ideally, 1 percent to 2 percent of the national fund should be combined with 2 to 3 percent of the local funds.

2. Takes Advantage of Technology.

The franchisor should use the modern surge of online video viewing and the advent of programmatic video advertising technology to ensure the success of the new advertising program.

By personalizing national advertisements to fit the local marketing area of each franchisee, the franchisor transforms national advertising into a reasonably cost efficient process (as opposed to if the franchisor expended resources to manage marketing for each individual franchisee personally).

This use of technology also ensures high performance and precision of measurement in advertising.

3. Centralizes both Ad Creation and Ad Campaign Management.

The franchisor assumes responsibility for creating brand video, pay-per-click, and display ads for each franchise unit and should coordinate the set through the management of an ever-growing ad campaign.

4. Communicates with Franchisees.

Communicates with franchisees on a regular basis concerning advertising efforts, including reports on what is being spent and what money is being generated the campaigns for each franchisee in each local unit market.

The Future of the Franchise Industry

The franchise industry rapidly changes in terms of both operations and advertising: localization is encouraging more franchisee involvement than before.

The future of the franchise industry, then, is not just global outreach, but local advertising.

If you agree, do not hesitate to contact us. Localization is our speciality, and we’d be happy to talk to you about our localization strategies.

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