Promotion vs. Brand Building: Striking a Balance

From what you read in the media, does it feel like 88 percent of ad dollars are still being spent on old media? While the growth rates and trends are shifting toward the Internet without a doubt, the reality is that franchise prospects use multiple media channels and that marketers must be focused on reaching prospects today so that they can become candidates tomorrow and franchisees within months -- not next year.

For a brand that expects to be relevant today, tomorrow, and years into the future, a sense of balance is required. A careful assessment of your current customers, your best prospects, and your competitive difference will position your brand for success. Chasing the latest trend or making a big bet on the media darling of the minute is not likely to be a success strategy in the long term.

At the consumer level, brands that focus on a specific part of the sales funnel will quickly find that they have picked all the low-hanging fruit and that their marketing is having diminishing yields. Investing 100 percent of the budget in brand building, social media, discounting, search, or some other tactical part of the media mix results in excluding or neglecting important customer segments. A sales increase is often needed right away, so the tendency is to run a coupon or discount franchise fees or royalties. You may see an immediate effect and your franchisees may call for more. Not all your customer segments are price-sensitive, and even those that are will of your brand's discounts if they are available all the time without any special sense of urgency or excitement. The same holds for brands that lower the cost of entry for franchisees, through reduced franchised fees, royalties, or both.

There is always a need to create consumer interest and awareness of your brand's signature items that may be higher priced, or to highlight your key differences to candidates, such as ROI and time to break-even, which should justify your franchise fee and royalty structure. Whether for consumers of franchise candidates, your signature items or services and key differentiators are what set your brand apart. While results may not be immediate, providing some ongoing marketing pressure will result in a slow but steady stream of new customers and franchise candidates. This is a critical element since the users of your brand's signature items are likely to be the most loyal and profitable customer segment - and serve as a marketing advantage when speaking with franchise candidates during the sales process.

There are a number of frameworks in which a target prospect or lead can be transformed into a customer or franchisee over time. The first given is that you can't sell something to someone who has never heard of your brand. Obvious yes, but it is surprising how many companies have a distorted perception of their public awareness. In most cases, there is far less awareness and loyalty from the general public than an insider tends to believe. Market research has an uncanny ability of providing a reality check. A simple form of sales process has the prospect going through four buying phases:

  1. Awareness
  2. Interest
  3. Evaluation
  4. Commitment

Each of these phases requires a different mix of brand building versus promotion. For consumers, a coupon or discount may be an excellent tactic during the "Evaluation" phase (as are entry-level discounts to potential franchisees), but this is not ideal if it is the only motivator during the "Commitment" phase. Ultimately a marketer needs to develop a calendar of communications that incorporates elements that address the needs of prospects in each of the buying phases. These communications may be concurrent or sequential but nurturing prospects in each phase will ensure an ongoing stream of potential franchisees.

Best practices:

  1. Do a segmentation analysis. Determine who your target customer is and what they are looking to buy.
  2. Analyze your results. Use quantitative metrics to track your results over time.
  3. Continually optimize. Test changes in your mix or strategy to improve some aspect of your program. Don't make massive changes in activities that are working unless you are confident that the new approach will enhance results. Many changes will actually result in weaker performance and undermine your sales efforts.
  4. Sow the seeds for tomorrow's success. Building awareness and credibility in your product or service often takes times and multiple exposures. Recognize that you will need to devote a portion of your marketing resources to nurturing and educating prospects so that they will become buyers at some point. There is only so much low-hanging fruit.

Michael Sick ( is a former marketing vice president with brands including Jack in the Box, Pearle Vision, and Arby's and is now an independent consultant. Contact him at 858-509-8930 or

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