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Franchise Industry Execs Miss the Opportunity to Leverage Franchise PR to Drive Sales

300 franchise executives converged on the Drake Hotel in Chicago this week for three days of intense evaluation about the state of franchise sales and dialog about best practices that drive results in today’s market. This much anticipated Franchise Update Conference centers around industry reports on numbers of franchise units sold, lead sources for the year, and cost per franchise sale.

This year’s theme, Mission Possible, held lots of promise as the previous year has been a wasteland for many companies. This year three big issues converge into a perfect storm that creates lots of choppy waters for franchise sales:

1. Fran Data experts projected that the franchise industry will have some truly choppy waters for the next four or five years due to lack of bank financing and shaky loan underwriting making credit hard to come by
2. Traditional powerhouses of franchise sales lead generation have trailed off significantly; franchise portals in particular are not delivering the quality leads they once were
3. The dramatic shift in the way people communicate and build trust and how this impacts the rise of social media left more than a few companies struggling to connect the dots

A big disconnect with franchise sales lead generation centered on an old-school tool: Franchise PR. Here’s a list of lead sources for franchise sales this year:

Lead Sources for Franchise Sales (where leads for franchise sales come from)

• Internet          34%
• Referrals          28%
• Brokers            17%
• Print                  8%
• Other               13%
• Trade Shows      3%
• PR                    3%

Sources of Closed Franchise Sales (Where the leads that actually closed came from)

• Internet          50%
• Brokers           16%
• Trade Shows   13%
• PR                 11%
• Other               10%

Franchise companies only generated 3% of the total leads for franchise sales this year. Only 3%! Those measly 3% of leads resulted in 11% of the total industry unit sales this year. 11%! Making matters worse, almost half of the companies represented at the Franchise Update Conference were not using PR to generate sales leads. HALF!

The Franchise Update report also gave out projected average budgets for franchise development: the average company will spend $162,000 on its total budget to sell franchises this year. PR was way down on the list of expenditures. If PR done poorly and without consistency produced 11% of the franchise sales last year, what should you budget to grow a franchise system?

Franchise companies need to wake up – PR if used correctly by someone that understands the social media shift is a powerful tool for franchise sales lead generation. PR firms need to wake up too. What PR worked 20 years ago and even what worked last year DOES NOT WORK in today’s market.

Here’s the issue: publicity is great. Publicity will get you in the papers and can help with search engine optimization and Google search results. Publicity can generate a binder full of clips. Franchisees love publicity because it’s great for the ego. Publicity does not, however, generate franchise sales. Old-school press releases about store openings, expansion plans and staff changes don’t have the oomph they once did in today’s social media market.

PR can be used to aggressively drive your franchise sales if you focus on telling your story and driving the social media conversation about what you do. We’ve successfully done this at my company, Showhomes, and I listened to Stan Freidman, CEO of Retrotax talk about how he has used it to get his new company off the ground.

Success with PR centers around the story you tell. If you can get people talking about your sales effort in social media arenas like Linkedin and Twitter, you can get reporters to bite and that will lead to lots of online trust and credibility. This is crucial because candidates are at their lowest trust level any of us have seen.

They call this the ‘Great Recession’ for a reason!

For more information from Thomas Scott, please contact him at:

Thomas Scott
VP Operations, Showhomes
615-483-4923
tscott@showhomes.com
www.showhomes.com
Twitter: @showhomesthomas
Linkedin: http://www.linkedin.com/in/thomscott

When in Washington to lobby Congress, you must do your homework but be prepared for the legwork

Members of the largest franchise industry advocacy group, the International Franchise Association, recently converged on D.C. for their annual Public Affairs Conference (formerly known as Franchise Appreciation Day). The purpose of the conference was to lobby members of Congress on behalf of small business and issues facing the franchise industry as a whole, which these days are numerous.

Topping the list was the hot topic of healthcare reform, followed by the loosening of credit by big banks to meet payroll and the availability of small business loans for start-ups to spur growth and employment.

This was my third IFA lobbying effort and I noticed a somewhat smaller crowd. We divided up into our respective State delegations and the association did their usual bang up job of educating us on the issues that we needed to focus on when we met with our legislators. Still we had more questions than answers. 

The humorous and always thought provoking columnist George Will laid out the absurd state of Washington these days and the change in the D.C. climate since he last spoke to the group two years ago. Will’s speech would have drawn more chuckles if it weren’t so sad. Select members from both sides of the aisle also gave their differing views, including a moderate Democrat that offered a glimmer of hope.

Well armed with facts, figures and a sense of strength in numbers we loaded onto busses for the short trip to Capitol Hill.  

IFA Texas Delegation

Then it hit me. I should have worn a more comfortable pair of shoes. In the practice of media relations, I realize the importance of doing my homework. The IFA helped me with that but the legwork was up to me.  In the vast walking environment that is the District of Columbia I knew my dogs would be barking. I am not built for burning arches and cramping toes. When the 5pm rush hit, I witnessed many female Washington veterans changing from heels to flip flops as I found myself crossing the east side of the Capitol complex in my stocking feet.

While I enjoy Washington and listening to the buzz of issues all around me, I was beginning to regret my decision to stay an extra day to lobby for a specific client who would like an energy efficient home product included in the weatherization program. The next day was filled with more cab rides than I had budgeted for and still involved hoofing it between the Canon building, a legislative reception, a brief stop at the Washington Post and then on to K Street. I think my gimp might have given me away as a newbie. 

The Answer Man!?!?

All in all, the trip was a success on every front. I achieved what I had gone there to do and in the process learned a valuable lesson.

When in Washington homework is important but don’t discount the legwork involved. Be prepared, wear comfortable walking shoes and don’t let this happen to you.

Shoes by the end of the day at IFA

Forget Cole Hahns, I recommend Eccos – http://www.eccousa.com/

Bage Anderson is co-founder of E.H. Anderson Public Relations. The Texas based firm specializes in media relations, video production and social networking and is a supplier to the International Franchise Association. www.ehandersonpr.com

In last week’s Part 2 of this series, we discussed several types of PR and news stories that are attractive to local media. One type of great content is feature news which positions each of your local franchisees as an expert in his/her field to the local media.

While some franchise systems are apprehensive to allow franchisees be the face and voice of the brand, others have found it to be the best way to maximize positive media exposure in local markets. 

Who would you rather have featured in local media: your CEO or your local franchisees?

My firm has seen clients’ news releases garnering 10 times more local pick-up than national releases when empowering ‘zees to engage their local media executing the following steps: 

1. Provide Press Release templates.
Pre-approved templates will allow your ‘zees to quickly create a localized press release while maintaining consistency with your branding and global messaging. Topics may include:
*Special events happening only in their location and therefore not part of a release distributed on their behalf 
*Milestones such as anniversary
*Awards and honors received from franchisor or local business groups

2. Provide pre-created and updated local media lists.
Having accurate local journalists’ info at your zee’s fingertips means less time they need to spend preparing to send releases and less worry on your part if they are targeting appropriate media.

3. Provide training for distributing releases

4. Provide ongoing tips for media follow-up
 

One last note: if you’re marketing a non-franchised chain with all corporate-owned outlets, the same process will give your local managers the power to become local experts and a go-to person for local media.

For more information on developing a program to empower your franchisees, please contact me here.

Some franchise system CEOs with whom I’ve spoken initially think that their company does not have stories interesting enough to get ink. They soon realize that by definition franchise systems are made up of local entrepreneurs specializing in a particular craft. These folks have many stories to tell of interest to local media and local audiences!

The key is to not rely on releasing national stories only on a wire service (which get ignored by most local editors) or having a churn n’ burn PR firm pitch a national story. You will have success by (a) creating localized releases with (b) good content and (c) sending directly to local writers and editors.

Before take a look at what content works for franchisors and their ‘zees, here’s one more question. What do PR Agencies who claim to do “local” publicity for franchise systems actually do? They publicize grand openings. That’s fine…but what about the 99% of your ‘zees who are already open? How can you use PR to overcome marketing challenges and drive THEIR business?

The answer is to do localized releases for ALL franchisees!

The subjects that work best are:

1. Events

If your system is planning an event at every outlet during the holidays, for a milestone, for Earth Day, Mom’s Day, or National Whatever Week, you should localize the details. Remember, events can promote a brand nationwide, but achieving your business goals means driving customers into the store on Main Street in Anytown USA.  

2. Feature News

These stories position your ‘zees as experts in your industry. Whether your company is in senior care, children’s learning, financial advising, or making great smoothies, the local owner and employees can be promoted as experts in their field from whom local editors will WANT to hear. This is especially true if you can tie your story into current news or trends.

3. Awards / Recognition

Do you have a list of ‘zees and their employees who can be recognized? Instead of a plaque or certificate, do them the favor and honor of releasing that news to their local media. More potential customers will form a favorable opinion of your brand over that story in the paper than they will over a plaque that no one sees.

4. Cause Marketing

Does your franchise system raise money and awareness for a good cause? Don’t give only your CEO credit. Which story will get the attention of a local editor in Springfield: “CEO of XYZ Pizza Franchising Corp Donates to $250,000 to Charity” or “Local XYZ Pizza Employees Raise $10,000 for Springfield Families in Need”?

Remember, local editors may need to be reminded via the releases that a globally recognized brand is really a local business run by a local business person. 

One last note: you don’t need to pitch local media on the above types of stories. As long as the content is interesting, the releases are written well, and the distribution is to appropriate journalists, you will get coverage.

Some PR agencies will try to sell you on the idea that you need them to sell the stories via phone to journalists with whom they can leverage their relationships. Pay them to pitch the NY Times if you want, but there’s no way any agency has worthy relationships with local daily and weekly papers in the hundreds of markets where you have franchisees.  

For more information on developing the content local media wants, please contact me here.

Next week in part 3 of this series, we will explore how executing local PR can empower your franchisees.  

Business Objective checklist: 

1.  You have business objectives that can be met using marketing tactics. Check!
2. Being a smart marketer presents its own challenges that need to be overcome. Check!
3. Marketing challenges? Throw more money into advertising. NOPE!

Many franchise organizations have spent fortunes on advertising, both nationally and locally, feeling that they need to pay BIG dollars to have a message be seen by consumers.

That’s fine if you can afford a Superbowl ad (people actually pay attention to those). But for the rest of us, our marketing challenges can all be overcome using Public Relations.

Print and outdoor ads go unnoticed in today’s constant blitz of images. TV ads are skipped and online ads get ignored as technology outpaces creativity.  More than ever, junk mail goes straight to the recycling bin, yellow pages go unused (and their once-import ads go unseen), and coupons go unclaimed.

So what DOES still get seen?

Local news.

Whether in print or online, more consumers are turning to their local news. Local media with a circulation of less than 50,000 is averaging a 10% increase in readership year over year! While readership is up in local media, revenues are down and newsrooms are understaffed. This is creating a “perfect storm” for providers of local news and PR content.

National and trade media may need to be pitched or sold your franchise organization’s story. Not local media! If you provide an interesting story about a local business or an interesting story about a national franchise with a local angle, the local media will thank you.

The cost of delivering localized news about your franchise and your local franchisee to that ‘zee’s local media is a fraction of what it would cost to advertise even in a small market. 

So why are so many franchise systems buying ads that are not consistent with their otherwise cost-efficient business models? I think they incorrectly feel that they have to advertise to be in the game.

Many systems also don’t realize that they have great stories to tell and news to share. So, next week in Part 2 of this series, we will further explore using PR to overcome marketing challenges and specifically focus on “What makes good local content for PR stories?”

•     Senior Care Services
•     Technology Solution Services
•     Tutoring Services
•     Home Repair Services

Click here to read the entire story from FranNet

Critical components for success for the franchisees in any of these fields include how the franchise system markets the brand locally and what tools are in place to drive business.

All of the above categories also have this in common: great stories to tell!
 
From senior care advice to educational events to tips on home repair, all of these business verticals have compelling content for delivering interesting, locally-focused stories to the local media on behalf of all franchisees.

Regarding which issues and trends in your industry would you like to your franchisees to be seen as experts by their local media and potential customers?

Hope’s By The Way is a new blog with daily updates tipping you off to great upcoming opportunities to promote your business to your local media. The host, Hope Salley, offers fun facts, awareness days, and other great angles for you to approach your local newspaper or other media.

Hope's BTW

Are you marketing an ice cream shop franchise? Take Hope’s tip about the upcoming “National Ice Cream Day” and reach out to your local media to inform them about an event at your shop.
 
Are you promoting senior care services? Take Hope’s tip about “Gorgeous Grandma’s Day” and create a memorable news release celebrating your franchise’s clients.
 
Not matter what your category is, be sure to check this free resource to find interesting ways to promote your franchise.
 

Click here to see Hope’s BTW on Twitter
 

Click here to see Hope’s BTW blog

1. Closing the communications loop. All franchisees would be aware of and involved in the news content going out to their local media and national media.
2. Driving more business to each franchisee’s local store. This is due to the specific naming of the location in the localized release. Let’s not have the customer guessing “is my neighborhood store a participating location?”
3. Increasing media pick-up in community media. It’s increasingly unlikely that national media cares about promotions and giveaways (until it breaks bad and gets ugly!), but local media have the interest and space to publish a story about a local business.
4. Promote the franchisees as hundreds – or thousands – of local business people involved in a fantastic national promotion. Plus, what local franchisee would not want to be mentioned in a positive local news story alongside Oprah?!?!?!