Marketing the franchise system – 1

In past articles we traced the franchise development process to the point where a prospective franchisor develops, documents and tests their operations systems and generates the franchise package and other legal documentation required to protect the franchise system. Up to that point, the franchisor has a product that can be used to attract franchisees to help grow the franchise network through their investment of time and money.

This product is the tried, tested and successful system, as opposed to earlier where the product was the individual goods or services offered in the company-owned outlets.

The franchise system as a whole now becomes the focus of the franchisor, while the franchisees will focus on the individual goods or services sold in their franchised outlets.

In order to attract and retain the right franchisees, the franchisor now needs to develop a marketing strategy as part of the franchisee recruitment strategy, which should therefore aim to develop a process through which to attract the right franchisees, develop confidence about the brand to the target, create awareness about the franchise opportunity and give as much information about the franchise opportunity as would attract the right franchisees.

We will also use the discussion ahead to show how the overall franchise system will be marketed to prospective customers of goods or services carried by the franchise system in order to drive foot fall into the franchised outlets.

Product or service distribution is probably the most important part of any marketing strategy.

Franchising represents an organized form of interdependent network of marketers (franchisees) that make the franchise product or service available to the target market at a location where they can visit an outlet or buy a product or service when needed.

The franchise model is used because of its greater efficiency and to perform the marketing channel functions of product, price and distribution more effectively.

Marketing from the franchisors point of view is not a transactional concept (i.e. pricing, distribution etc.) but a relationship concept such as the importance of customer/client trust, satisfaction, customer retention which would then ultimately lead to profitability.

The franchisor’s marketing should therefore be focused on creating demand not just for the franchise to prospective franchisees but also product or service demand amongst the system’s target audience. As such the franchisor’s activities must be associated with the management of successful relational exchange in understanding and communicating with the prospective franchisees and the ultimate customer.

In the franchise relationship the franchisee has control over the distribution of the product or service, price and location. The franchisor’s responsibility is to direct and manage the marketing communications effort.

Brand is an important and the most valuable of a franchise system’s assets. In fact, it is generally acknowledged that franchising is all about branding.

Brands are the products and/or services deliberately created and developed by the franchisor that have added-value that are recognized and meaningful to the franchise systems customers.

The marketing perspective of brand value is established in the images, beliefs and core association’s customers have about a particular brand, and the degree of loyalty or retention a brand is able to sustain.

Baines et al (2008:374) highlights the importance of branding as a method that “helps customers to differentiate between the various offerings in a market.

It enables them to make associations with certain attributes for feelings with a particular brand. If this differentiation can be achieved and sustained then a brand is considered to have a competitive advantage”.

Successful brands also, according to Baines et al (2008:374) create “strong, positive and lasting impressions through their communications and associated psychological feelings and emotions, not just their functionality through use”.

It is the responsibility of the franchisor to build a brand that means something to the customer.

The franchisor must therefore have a strategy in place that will help franchisees establish the same brand equity in their local market. That strategy is based on an effective and sustainable marketing communications program.

The writer is a franchise consultant working to promote adoption of franchising in Africa.

He works with country apex private sector bodies to increase the uptake of franchising by helping indigenous African brands to franchise.

We turn around struggling indigenous franchise brands to franchise cross-border.

We settle international franchise brands into Africa to build a well-balanced franchise sector.

We help African governments create franchise-friendly business environments for quicker African economic integration under AfCFTA.

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