Marketing Byte: Looking at the Greatest Current Challenges in Marketing

Annual franchise report

Last year, Franchise Update Media released its 2025 Annual Franchise Marketing Leadership Report. The AFMR is a survey of top franchise marketing executives that provides insights into the latest consumer behavior trends, innovative marketing strategies, technology, and the impact of digital transformation on franchise businesses. The AFMR is the first and only report dedicated to B2B and B2C franchise marketing leaders.

It includes perspectives from industry experts about the evolving market dynamics and how franchises can stay ahead of the competition. This report delivers data collected from franchisors across the franchise community with responses organized by industry, marketing budget, system-wide sales, and more. The annual report provides franchisors with the ideal resource for studying their marketing investments, benchmarking their sales and advertising budgets against their own industry categories, as well as setting goals and budgets for the year ahead.

The AFMR also includes research into digital advertising practices, the growing investment in mobile and social platforms, and best practices in building marketing teams. Over the last several years, the AFMR was expanded to include more information about online reputation management and the use of artificial intelligence (AI). It starts by identifying how many franchises are using AI and in which ways, along with their confidence in using the technology.

It also looks at how the integration of AI has impacted the customer experience, its challenges and limitations, and their plans for future investment in AI. The report also explores franchisee involvement, franchisee training and support, and feedback from customers regarding the use of AI. Challenges associated with franchise marketing Franchise marketing departments frequently come up with creative and successful ways to connect with their consumers.

Marketing challenges

These wins are often celebrated through platforms like the Innovation Awards, and their strategies are repeated in future years and duplicated by other brands. However, along with every successful campaign, franchise marketers face a series of roadblocks that they must navigate. In the latest AFMR, Franchise Update asked marketing executives about the greatest challenges and obstacles they currently face.

They provided many different responses, and we broke those down based on industry, unit size, and system revenue. Starting with industry sector, there were eight main categories of challenges faced by franchise marketing departments. All of those in the retail (non-food) group said localized marketing efforts were a current challenge.

Two-thirds of the respondents from that same group also cited competition and budget constraints as being major obstacles. Budget constraints were a popular response among all five groups, including three groups that responded with 67 percent. A high number of food franchises also cited localized marketing efforts (88 percent) and franchisee engagement and training (78 percent) as major challenges.

When looking at responses to the same question based on franchise unit size, every major group responded unanimously to at least one challenge. One hundred percent of franchises with 251 to 500 units and 1,001 to 2,500 units said localized marketing efforts were a major obstacle. Franchises with units yet to open and those with 1,001 to 2,500 units also unanimously said budget constraints were a challenge.

Budget constraints and localized marketing efforts generally ranked high among most franchises when categorized by unit size. Finally, we examined the responses based on the systemwide revenue of the franchises in the survey. Local marketing efforts stood out the most with the following responses: $500,001 to $1 million – 100 percent $1 million to $5 million – 100 percent $500 million to $1 billion – 100 percent Over $3 billion – 100 percent $50 million to $100 million - 88 percent $25 million to $50 million - 75 percent Eight groups had 50 percent or more of the respondents say that budget constraints were a major challenge for them.