Challenges Facing Franchise Development in 2019 and What Brands Can Do

The franchising landscape has changed considerably over the last one, five and 10 years—gone are the days of traditional lead generation and ads in legacy publications. Now, a franchise development budget is better spent on targeted social media campaigns, especially because brand webpages don’t provide brand validation or “buzz.” To reach the right franchise candidate today, brands need to adapt their franchise development strategy to better align with the savvy consumer at the center of our digital age. In an industry that, by definition, functions by replicating models, this adaptation certainly has come with its growing pains.

So what does the world of franchise development look like today, and how can brands resolve some of the associated challenges?

“A lot more people are finding franchises through referral networks or broker networks,” explained Steve Beagelman of SMB Franchise Advisors*. “So that’s companies like FranNet, FranServe and others. That’s a big part of the landscape today that wasn’t there five, 10 years ago.”

Franchise consultants and brokers can help reduce risk, serve as a sounding board while a candidate parses the franchise disclosure document (FDD) and provide industry insight a candidate might not otherwise have access to. This appeals especially to the consumer of today, Beagelman explained, who is more data-oriented and research-savvy.

“The candidate today has done more research online. Now everyone can search everywhere, so brands need to have a strong presence on the web and on social media,” Beagelman said.

No Limit Agency*’s Chief Development Strategist Sean Fitzgerald has worked in franchising throughout his entire career. He echoes Beagelman’s characterization of the modern franchise candidate.

“It’s a continued trend that candidates do not meet with franchise development people to get the info they need,” Fitzgerald said. “The challenge that presents, then, is that, if the info they are getting [online] is inaccurate or negative or just not enough, it will make it hard for franchisors to engage with them.”

Herein lies the importance of a strong digital footprint.

“[Brands] need to provide as much info as they can across as many forms as they can to speak to that target candidate,” Fitzgerald said.

Fitzgerald recommends that brands take initiative when it comes to getting engaging, relevant info out to their target candidate. In addition to making their presence known on social media, brands should invest in creating high-value content like videos, Q&A sessions and more.

Fitzgerald emphasized that relevant content across those channels typically engaged by the modern consumer—a consumer who increasingly turns to social media for information—helps immensely.

Both Fitzgerald and Beagelman also clarified that the candidate pathway has changed over the years.

“It used to be that marketing just meant running an ad. A candidate would see the ad and then reach out,” Fitzgerald said. “But now, it’s about education and awareness before the conversation. Brands need to understand the candidate journey to establish credibility.”

“I agree with Sean,” Beagelman said. “It’s a different environment today. New companies coming out are doing their franchise development by promoting through Facebook, having great SEO, etc. Older companies might not be looking at it like that, but that’s how the newer generation thinks. It’s not just about lead generation,” Beagelman explained.

When faced with this new franchise development landscape, what can brands do to help bolster their success?

“Understand your candidate,” Beagelman said. “Surround yourself with great people, advisors, strategic partners and vendors who can relate to today’s consumers. Make sure you’re communicating with candidates the way they’re looking for—texting, for example, is big today. The more direct the communication, the better.”

Beagelman also underscored Fitzgerald’s point about utilizing channels beyond just a brand website.

“PR is great, a great way to get your brand out there. And that’s huge—to have people talking about you provides that third-party validation,” Beagelman said.

Even with all that emphasis on a strong digital footprint, Beagelman still took care to speak of the positive potential of making a showing at trade shows.

“I still believe that people should exhibit at trade shows. Not every show, but the big shows. Sometimes that personal contact with the candidate still is really important. Attend those in regional markets and major markets where your brand lives,” advised Beagelman.