Annual Franchise Marketing Report: Recommend or Require Local Spend?

This new annual report provides franchise consumer marketers with invaluable data and analysis they can use to benchmark their performance against other brands, within both franchising and their industry sector - a resource they can use to improve the effectiveness and ROI of their marketing efforts. Franchising's increasingly competitive landscape has strengthened the need for marketers to better understand how their brand measures up against the competition and is performing in the wider marketplace. The AFMR is intended to help franchise consumer marketers understand how their team compares with their peers and, more importantly, help them allocate their limited resources to the most effective channels for achieving their system-wide goals.

Brands participating in the first AFMR represented more than 13,000 locations, $8.3 billion in annual revenue, and $131 million in annual marketing budgets. Diane Phibbs, EVP and chief content officer at Franchise Update Media, presented highlights from the report this past June at the 2019 Franchise Marketing Leadership Conference.

Participants consisted of franchise marketing leaders who completed an in-depth questionnaire online. Responses were aggregated and analyzed to produce a detailed look into the marketing practices, budgets, and strategies of a wide cross-section of franchise brands and sectors. The data and accompanying commentary and analysis provide the basis of the 2019 AFMR.

Recommend/Require Local Spend? Responses to this question provided a picture of how franchisors address and monitor local marketing spend. Three of four respondents require or recommend spending on local marketing.

What was surprising is that nearly 6 in 10 (57%) of the brands responding did not have systems to ensure that each location was spending at the local level. And only 39% had franchisees submit local marketing spend reports and/or receipts to corporate, while 4% had a third-party reporting program. "I was surprised to see these results," says Phibbs.

"Local store marketing is critical to growing unit revenues, and it's critical to building brand awareness to sustain sales until there are additional locations developed in the market. From that point, each location must continue to market within the community to further build the advertising dollars that will help them grow into additional forms of media (TV, radio, and print). *Next time, last in the series: Measuring customer experience.