5th Annual Franchise Marketing Report: Marketing Spend & Effectiveness

Benchmarking data and analysis at its best

Results from the 2023 Annual Franchise Marketing Report (AFMR) were revealed this summer at the Franchise Customer Experience Conference, or FCXC.

The AFMR was created at the request of our FCXC conference advisory board to develop relevant content for CMOs and to learn more about their needs and challenges. Its purpose is to provide the data and analysis CMOs and other top marketing executives need to measure their success and learn how they can do better at a job that seems to get more complex with each passing year. (Think digital!)

The AFMR delivers invaluable benchmarking data that provides franchise consumer marketers with the insights they need to know how they stack up against other franchise brands and their industry. In short, the report is a unique resource franchise marketers can use to improve the effectiveness of their marketing efforts and make the most efficient use of their marketing budgets.

Data was collected from a group of marketing leaders at 65 franchise brands who each completed an in-depth questionnaire. Respondents’ roles ran the gamut: co-founder, CEO, president, COO, CMO, chief growth officer, VP of marketing, director of marketing, marketing and operations director, director of advertising, marketing and communications director, general manager marketing, director of digital marketing, and VP of franchise development. Their responses were aggregated and analyzed to produce an in-depth look into the marketing practices, budgets, and strategies of a wide cross-section of franchise brands and sectors.

What follows are selected highlights from the 2023 AFMR, which offers commentary and analysis that provides context, insights, and a detailed look into the data contained in the report.

MARKETING SPEND & EFFECTIVENESS

Choosing where to spend your marketing budget is an ongoing challenge. Marketers plan the best they can for the coming year, but know all too well that what worked for their brand in January may no longer be working by June or September. External events—from the X-ification of Twitter to the advent of ChatGPT and GAI variations—can upset the best-laid plans. Then there are the ever-changing consumer tastes and preferences to factor in… if you can make an accurate guess at that fickle, moving target. But you must. These highlights show where marketers spent, and where they got the best results. And, of course, results vary by industry.

Social media. For the Retail Food and Retail Non-Food categories, social media was a prominent driver of consumer sales. For all categories, more business is being generated through company consumer websites. The question remains what drives people to those websites in the first place.

Digital sources. Respondents in the Food category reported that the following digital categories drove the most sales. In order of ranking, they were: 1) pay-per-click on search engines, 2) social media advertising, 3) search engine optimization, and 4) sponsored content.

Best sales platforms. Facebook, by a long shot, produced the most sales in all categories, with Instagram second. YouTube and Twitter (it still was Twitter then) were also strong drivers in the Food category.

Most effective platforms. Respondents found the following platforms the most effective: Google Analytics, Yext, SOCi, Medallia, Chatmeter, Reputation.com, Rallio, HubSpot, Listen360, Consumer Fusion, Podium, Riso SEO, Moz Pro, ReviewTrackers, Merchant Centric, and company CRMs.

Top revenue generators. Pay-per-click, SEO, social media, and sponsored content were the top revenue generators among the general business categories. Re-marketing and target trailing were not on the radar this year.