Franchise Articles

We asked Martha O'Gorman, Chief Marketing Officer at Liberty Tax Service, how she identifies Liberty's ideal customers - and how she targets them effectively with marketing initiatives. Here's what she had to say.

The one thing I have learned through my years of experience in marketing is that the ideal customer is identified best by modeling them after a real person. I spend a lot of time watching and listening to our customers in person and through social media channels to get a sense of who they are and what they are looking for in a tax preparer. In many ways, that expectation is all over the board, but there is one constant that rings true throughout our customer base: they want to be treated with respect by a friendly person who makes them feel good about their experience with us...

Note: This article originally appeared on the Marketo Marketing Blog.

Back when I was in IT, my biggest fear was implementing a solution that no one liked -or worse, that they didn't end up using. Being at a startup tech company, my IT budget was minuscule. This meant that aligning with other "well-funded" departments in my company, such as the marketing team, was always a challenge.

If I'd had an unlimited budget, I would have always implemented complete turnkey solutions (for those not in IT, these are "off the shelf," ready-to-go solutions), with 1,000 professional services hours and 24/7 live support. I wouldn't have worried about learning the solution or onboarding my users. Crazy, I know... but everybody has to dream...

The past few years have seen an increased use of animated cartoon by sponsors at Franchise Update Media conferences. Whether aimed at franchisees, franchisees, or marketers, these presentations are not only a departure from "standard" promotional and marketing videos, but judging by audience reaction, they also seem to draw more eyeballs (as well as a few smiles) - despite clearly being marketing pieces pitched to sales and marketing pros. Toonimo, a company that produces animated cartoons, presents their top five reasons to consider incorporating moving pictures into your brand's online marketing mix. Below are some edited excerpts.

From the intro
Cartoon animations can be a powerful marketing tool for online marketers...

Mary Meeker's 2014 Internet Trends
Kleiner Perkins venture capitalist Mary Meeker gives out a valuable presentation about Internet trends every spring. It's widely considered a sort of "State of the Internet" address. Here are the data-packed slides from her 2014 presentation. Key insight: The Internet is still growing fast worldwide and mobile is growing even faster.

Twitter Interactive Guide for Small Businesses
Want to get started with Twitter and don't know how or where? Or maybe you're already using Twitter and want to take your activity to the next level. The popular social media giant (255 million monthly active users) has put together an interactive guide to help your business reach its goals, whatever your experience level...

Julia Stewart
CEO, DineEquity
System revenue: $7.2 billion (Applebee's $4.2 billion, IHOP $2.7 billion, company units $292 million)
No. of units: 3,612 (2,010 Applebee's, 1,602 IHOPs)
Public or private: Public
Growth plans: Build on the iconic status of our brands through our culture, brand equity, and positioning, providing quality to our guests, and development. One of the tenets of our plan for continued growth is innovation--in our menu, guest experience, and our restaurants, domestically and abroad.
Year founded: IHOP 1958, Applebee's 1980 (Following the acquisition of Applebee's in November 2007, the name was changed to DineEquity, Inc., effective June 2, 2008.)
Began franchising: IHOP 1960, Applebee's 1985
Years with company: 15 years in the Applebee's and IHOP brands, the past 12 as CEO of IHOP/DineEquity
Years in franchising: 30-plus
Number of international locations: Applebee's, 150; IHOP, 51

Questions

How has your life experience made you the leader you are today?My very first experience in the restaurant industry was a job as a server at my local IHOP, which began a lifelong love affair with the restaurant industry...

Building a strong franchise system through unit growth is a team effort requiring participation from the entire organization. To succeed more often in attracting and capturing the best possible candidates for your system, it is essential that all departments contribute.
Most franchisors don't take the time to educate and involve all their key department heads in the development process. But without this interaction, conflicts can arise about the capabilities of new franchisees, with blame for any failures placed on the franchise development department--even though operations didn't want to be involved in the selection process. These conflicts usually occur when a new franchisee is struggling after a few months and the discussions start focusing on whether the franchise was granted to the right person...

Four years ago David Griffin had just purchased 25 Jiffy Lube stores in Colorado. The stores were underperforming, some were dilapidated, and the U.S. economy still at one of its all-time lows. Those factors created a perfect storm for Griffin to expand--but it wasn't a walk in the park.
"We've spent the last three years reviving those units, and it has been a monumental task," says the 56-year-old today. Griffin says it took millions of dollars to turn around those 25 struggling locations--and the process tested both the company and his family, which is deeply involved in the business. "I'm still working right alongside my wife Joye and my three sons," he says. "We are today's family farm."
The effort paid off, says Griffin. "Sales at those 25 stores had been in a double-digit dive prior to us taking them over...

Retail traffic is an important indicator of shopper behavior and a bellwether for retail sales results. If more people are visiting stores, there are more opportunities for retailers to convert shoppers into sales. When traffic is down, retailers have fewer opportunities, thus, typically, fewer sales. More traffic doesn't guarantee more sales, but store traffic and sales are correlated.
But traffic is notoriously difficult to measure. If you scanned the headlines about retail traffic during this past holiday season, you would likely have been more confused than enlightened. Depending upon which index you referred to, retail traffic was either significantly down, somewhat down, or up.
Why are there such discrepancies in these indexes - and whom should you believe?

Is retail traffic up or down?
The answer depends on where your numbers come from...

Every successful franchisor reaches a certain point where they must decide what the next step will be in expanding their business. Growing the franchise locally, then nationally, is the logical progression for domestic growth. But to fully capitalize on potential growth options, and to avoid over-saturating domestic markets, franchisors may want to think about international expansion.

The growth of a brand at an international level can pay huge long-term dividends to the franchisees, the franchisor, and shareholders alike. Global brand recognition, increased brand footprint, and global accounts programs all benefit the business. Revenue streams from new franchise sales will combine with ongoing royalties for the franchisor, and all of these factors build a larger family of satisfied franchisees...

This is Part 3 of a series on why new and emerging franchise brands fail. In the first two parts, we discussed 8 reasons they fail. The remaining installments will cover what they can do to succeed.


Doing It Right from Day One

During a recent IFA convention, we approached several franchisors in different industries that survived the start-up phase and had growing franchise systems with happy and profitable franchisees. They had all crossed the threshold where they were royalty-sufficient, meaning their existing royalty stream sustained the business. Their business could sustain itself if they failed to recruit another franchisee.

We asked them, "Knowing what you know now, if you wanted to launch your concept right and not be undercapitalized, how much should you have started with?" Their answers were consistently between $1 million and $2 million...

We live in a world where law firms commonly have billable hourly quotas that their attorneys must meet, and substantial hourly rates as well. Yet, franchisors have a goal seemingly inconsistent with this framework: to minimize outside counsel fees. Can these seemingly opposite purposes be reconciled? Yes, and the way to do so is for franchisors to ask outside counsel to assist them in those areas that can competently be handled by the client after being set up by outside counsel. Here are some of those areas.

• Ask counsel for the templates to do the Michigan and Utah annual filings.
Perhaps it makes good sense for outside counsel to file the annual Michigan and Utah Notices the first time a franchisor intends to offer or sell franchises in those states...

Objective: Grant the franchise to qualified buyers on Discovery Day or soon after
Length of meeting: 30 minutes to 2 hours



Overcoming buyers' cold feet

Feeling butterflies in personally uncomfortable situations is a human condition. We all know and have experienced this. It means we care and really want to do something right - whether it's our first step on stage in a community performance, preparing for the city league tennis championship, addressing an audience of 500 people, moving to a new city, taking on a new job... or getting Discovery Day approval to buy a franchise business!

Why am I bringing this up now? Because when closing time starts "closing in," reality hits some buyers like a sledgehammer...

John Sullivan is a Midwesterner with a background in retail and corporate America. He moved to St. Louis following college and began his career with Macy's department stores. He went on to work in the plastics industry for companies like Dow Chemical and Rohm and Hass over the next 12 years. But it was when his executive level position required extensive travel that he began to reassess his career. He began looking for a way he could be at home more with his family. Franchising proved to be the perfect solution.
Three years ago Sullivan became a ProTect Painters franchisee and has loved every minute of it. He says he has a much more flexible schedule and that much of what he learned in the corporate world has helped him become a successful franchisee...

Fast on the heels of its recent legal challenge to a new minimum wage law passed in Seattle, the International Franchise Association (IFA) has now set its sights on the city of Chicago.
Steve Caldeira, president and CEO of the IFA, wrote a letter to the Chicago City Council and Mayor Rahm Emanuel last week urging them to remove a provision in a bill to raise the minimum wage that would discriminate against franchisees.
Caldeira and the IFA have been clear in their assertion that franchisees are locally owned, small businesses and not large, national businesses as the legislation suggests. Giving non-franchise small businesses extra time to increase their wages, but forcing franchisees to raise their wages along with large companies is unfair and unconstitutional, says Caldeira...

There are rules for a reason: they work for most people most of the time. Often, scientific evidence backs them up. But as with almost any other endeavor in society that doesn't involve criminal activity, rules can sometime be broken - or at least bent - without the world coming to an end.

This is especially true in business. Company owners and top executives give a lot of thought to winning and keeping customers, and they spend a lot of time and money on things like PR, leadership training, social media campaigns etc. But the real front lines of building a business are in the daily interactions employees have with customers.

One of the major roadblocks to customer service excellence are the policies and procedures most companies have in place to make sure that 1 percent of their customers don't take advantage of them...

The benefits of tracking traffic and measuring conversion rates in retail stores have long been established and are now widely considered fundamental in retailing. Not only have retailers been doing it for decades, but the retailers who leverage the insights effectively have an "insight edge," and consequently a competitive advantage over retailers who do not.

Over the course of the last 10 years, I have worked with a multitude of franchise and dealer networks including those in wireless, general merchandise, electronics, home improvement, and automotive segments. Regardless of the type of franchise network, I see a consistent disconnect between franchisors and franchisees when it comes to analytics, especially store traffic and conversion analytics...

Every marketer thinks about their ideal customer - where they live, what they like, what they buy, where they buy it, and why. Creating a picture of that perfect customer goes a long way in helping consumer marketers determine where to spend their own money. A free, customizable template from HubSpot, "How To Create Buyer Personas for Your Business," provides a way to answer those critical questions about your ideal customer.

The report is divided into five sections, including a set of blank PowerPoint templates to create three customized buyer personas for your business. Here's an overview of what's inside, with excerpts from the report:

1) What are buyer personas?
"Buyer personas are fictional, generalized representations of your ideal customers...

Is That Why it Says "Ad" On it?
Research shows that 36% of people tested still don't realize that Google's Adwords ads are actually advertisements (down from 41% in 2013). In fact, the study found, one in four tested don't know that Google has ads at all! In 2013, 91% percent of Google's revenue was attributed to advertising. It must be nice to be a company whose customers don't know that they're the product you're selling.

Don't Trust Google? Try DuckDuckGo
DuckDuckGo, the small search engine that distinguishes itself from Google and the other large search engines by its guarantee of user privacy, has added a number of new features to make itself more attractive. Now DuckDuckGo users get auto-suggested searches, maps (using OpenStreetMap) and local search, and weather, image, and recipe search...

What role does diversity play in your brand's recruitment and development process?


Chris Cheek
Chief Development Officer
Toppers Pizza
Essentially doubling in size since 2010, Toppers Pizza is one of the fastest-growing pizza chains of the past 3 years. At 50 stores, we are at the beginning of a period of even more accelerated growth. Our goal, to reach 500 pizza stores by 2020, can only be realized by our focus on recruiting new franchisees that, among other things, are able to win the pizza delivery competition at the local community level.
If you look at the changing population of the United States in the last 12 to 15 years, we understand and embrace the strategic imperative that, to be successful in the growth of financially successful new stores, our franchise owners must be able to bring it with passion and build something special at the local level...