2024 AFDR Data - Where Franchises Get Their Leads

Franchise Update Media has been researching franchise lead generation and franchisee recruitment processes for more than a decade. An annual in-depth online survey queries franchise development professionals about a number of issues related to their lead generation and recruitment strategies.

All the responses are collected, aggregated, and analyzed to produce a detailed look into the recruitment and development practices, budgets, spending allocations, and strategies of a wide cross-section of franchisors. The results are presented each year in the Annual Franchise Development Report (AFDR), which can be ordered online at afdr.franchiseupdate.com.

The 2024 AFDR report is a valuable resource that can provide crucial insights on franchise development lead generation and recruitment best practices. It’s the kind of information that can help brands assess what they are doing right, and what needs improvement.

This is part of a series of articles that will draw out a few important insights from this year’s AFDR in upcoming issues of the Franchise Leadership & Development Report. It’s hopefully the kind of information that can give you an edge in your lead generation and recruitment efforts.

For perspective, this year’s study surveyed 120 brands. The franchisors had 2,533 company-owned units and 24,101 franchise units. The brands represented a variety of segments, including food, retail food, nonfood retail, brick-and-mortar service, and service based on population and territory.

Digital advertising is king

There are many different sources franchises go to get their leads for qualified candidates to bring in and grow their system. Although some are more effective than others, it is generally recommended to use multiple sources to diversify these efforts for top optimize franchisee recruitment. However, in looking at responses from the 2024 AFDR, one method clearly stood out from the rest.

Survey participants were asked to select where they are getting the most leads, and digital advertising far and away had the highest number of responses with 60 percent. Digital advertising can come in the form of social media and content marketing through platforms such as Google and Facebook to reach audiences based on demographics, interests, and behavior. Brokers received the next highest response with 13 percent, followed by referrals at nine percent. Although there were nine specific category options, none of the others received more than four percent of the responses.

Not surprisingly, these three methods were also the most successful in closing leads. Digital advertising had the highest lead to close ratio with 43 percent of the responses. That was followed by referrals (34 percent) and brokers (19 percent).

When asked where they are getting the most digital leads, two sources stood out the most. Pay-per-click on search engines (31 percent) and social media advertising (30 percent) accounted for more than 60 percent of the responses. Franchise portals (17 percent) and search engine optimization (15 percent) were the only others to receive more than three percent of the answers.

The area which saw the most diverse number of answers was when franchise executives were asked of all digital leads, which source has the highest lead-to-close ratio. The question received eight different responses, somewhat equally spread out. Pay-per-click on search engines garnered the most responses with 32 percent. That was followed by search engine optimization (21 percent), social media advertising (16 percent), and franchise portals (11 percent).