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It is often said that uniformity and consistency are the
defining features of franchising. Under a successful
franchise model, I should be able to walk into any franchised
location across Canada and know exactly what types of products and
services are available to me. Part of that expectation is
fostered by experience, as I participate in the actual consumption
of these retail products and service offerings.
But where I cannot visit a store myself to gain that experience,
my expectations are formed by the franchise system's
advertising. As a result, it is critically important to
franchisors that they impose as much control as possible in
advertising and marketing activities to prevent franchisees from
going off-message and deviating from that uniformity.
Franchisors generally accomplish this in 2 ways: (1) by
requiring franchisees to contribute a percentage of their sales to
an advertising fund, and (2) by requiring franchisees to spend a
separate percentage of their sales on local advertising.
Under the former, the franchisor will administer the collective
contributions of the franchisees to produce advertising campaigns
that are intended to promote the brand as a whole. Under the
latter, the franchisee will be required to conduct its own
advertising initiatives (typically in the form of flyers and
brochures) which must be approved in advance by the franchisor.
New franchisors have likely not quite established the brand yet
by the time they start franchising, and that lack of identity may
present opportunities for franchisees to have more of a say in
their own advertising activities. Certainly in the case of a
new franchisor who has never done much advertising at all, but
rather relied on word-of-mouth marketing, an opportunity to
negotiate on advertising fees presents itself to the
franchisee.
But franchisees should also try to get the franchisor's
permission to operate their own Facebook pages and Twitter
accounts. Once taboo in the franchise industry just a year or
two ago, preferences have changed course, and franchisors are now
not only amenable to this suggestion in many cases, but they even
encourage it. Social media advertising is a great way for a
franchisee to engage its local customer base and, importantly,
it's free for the franchisee!
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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