Coffee and Analytics: How Franchisors Can Utilize Data to Bring in the Right Leads and Close Deals Faster

Mainland* — a marketing and communications company and 1851 Franchise’s publisher — recently hosted a Coffee and Analytics webinar in which CEO Nick Powills walked through the company’s April findings to explain how brands can utilize data to optimize their individual franchise development process. The webinar revealed interesting insights into the franchise industry at large, outlining some common takeaways Mainland learned by profiling over 150 franchisees across its client portfolio this past year.

“We want every brand to win at franchising,” said Powills. “You tell us your goal, we figure out our strategy to get you there. As we continue to explore ways to get better at helping brands reach their goals, we are starting to look at data and analytics to lead our decisions. This year, it was important for us to look at all the data we have access to and use it to provide insights into each brand, category and the industry in general. We want to show brands how they can invest, structure and build a story to help optimize franchise sales.”

As Powills points out in the webinar, the franchising industry is rife with blanket statements — it costs around $8,000 to $12,000 to close a deal, for example. But each brand is different and every candidate’s life creates a different pathway to signing. That is why data can be an invaluable tool in helping individual brands create a franchise sales process that cultivates a path of least resistance for their ideal candidates. Mainland studies story interactions, Google Analytics, consistency of content and sales KPIs to strategize the best path toward winning.

What Makes a Brand Appealing to Prospects?

Mainland has collected a robust pool of franchisee profiles across all of its clients. These are essentially questionnaires that ask franchisees about their experience through the buying process, their background, their journey to the brand and their long-term goals. This year, Mainland analyzed over 150 recent franchisee profiles to gain greater insights into each individual brand’s sales process in order to work backwards from there and make it stronger. 

“We have to dive into individual brands,” said Powills. “We can gain insights across categories and investment ranges, but your data is your data. If your cost-per-deal is $50,000, for example, we can work on bringing that down, but it will take an understanding of your specific brand. Lead generation should be about getting the right leads that will lead to a deal.” 

Powills says there are four main categories franchise brands need to analyze when determining whether their concept will attract leads: 

The investment range required

1. The benefits of the business model
2. The culture
3. The system’s recent momentum

In the case of the investment, for example, Powills says brands may jack up their franchise fee because of broker fees or the cost of doing business, but this can push their investment range over an edge that makes it more challenging to attract prospects. 

“Looking at the data, the Item 19 has turned into a giant leveraging point for many brands, but most don’t tell the complete story,” said Powills. “For example, we work with a fitness brand that started in the suburbs. As they moved closer to major cities, their unit level economics kept climbing higher and higher. New franchisees bought into the system with an expectation for a lower average unit volume, but their sales kept going up. Now, the franchisor has exceeded their expectations. An investment structure tends to tell the best story, not the most realistic story, which can make validation suffer as franchisees don’t meet their expected volumes. Once validation suffers, the cost-per-deal goes up as franchisors spend more money to convince prospects this is the right investment.”

According to the franchisees profiled, Powills says there were two factors that convinced them to buy: the business model and the culture. 

“How much does the franchise cost to buy it, and how much can franchisees make? A franchise needs to stand out in this regard,” Powills says. “Culture, on the other hand, is seen in the leadership, the support, the validation of existing franchisees. The data shows that both those factors can have a major influence on sales.”

Finally, the data shows that brands need to place significant emphasis on their recent franchise momentum and the health of the system. 

“As franchise industry expert Sean Fitzgerald often says: ‘franchise sales are like locomotives.’ Once you stop or stall it out, it is hard to get it going again,” said Powills.

How to Use Data to Impact Lead Generation

Once the infrastructure is in place and the franchise opportunity is strong, it is time to start bringing in leads. While there are several holistic tools franchisors can utilize, such as brokers, portals and digital marketing, Powills says the buying process is going to be different for every brand, which is why they need to leverage data to understand that process before even attempting to generate leads. 

Mainland is focused on a specific data-point called “impression-to-inquiry.” According to its findings, the average timeframe it takes for a prospect to go from a first impression of a brand to inquiring about the franchise opportunity is 7.4 months. 

“If we can get a sense for how long it takes to get a deal done, we can be predictable in how we impact our client’s sales,” said Powills. “How do we find the persona that is willing to move faster than the pack from impression-to-inquiry so our franchise brands can get leads faster?”

Mainland’s data revealed several interesting insights into how different prospects behave in regards to this timeline. For example:

• Many franchisees in the age range of 30 to 40 moved much faster through the impression-to-inquiry process, with around 12% inquiring in less than 90 days. 
• In April, Mainland clients saw a few buyers of concepts under $100,000 go from inquiry-to-lead in less than three weeks.
• One buyer for a concept over $500,000 went from inquiry-to-lead in only a few hours. 

Mainland is utilizing that data to help brands find the ideal leads that will move through the process faster and thus bring down the cost-per-deal.

How to Help Candidates Overcome Fears Through Strategic Storytelling

Another valuable datapoint Mainland has been able to pull from its collection of franchisee profiles is “what could have scared prospects away from buying?” Powills says there are surprisingly only three main answers: 

• The investment requirements
• Family concerns 
• The insecurity of being a first-time franchise owner

“A franchise is one of the toughest things to convince someone to buy — you are asking someone to quit their job, become their own boss and take their families safety and legacy in their own hands,” said Powills. “Our insights allow us to create strategic pieces of content that are designed to show how franchisees have overcome their fears and found a scalable investment. We can write stories that showcase the experience of three franchisees that had specific fears, whether it be those who were worried about the investment, those who had spouses who were unsure in the beginning, or those who found success as first-time franchisees.”

With this content, Powills says the goal is to help prospects feel more confident and leverage data to bring that impression-to-lead time down. “Brands want deals fast, and they think leads are the answer, but it is really about the quality of the lead,” he said. “We want the leads that will close faster and showcase the viability of the concept. So, if we are armed with a piece of data-driven content, we can add it to a brand’s toolbox and use it in the sales process.”

During the first call with a prospect, brands can utilize these tools to make sure all candidates feel comfortable and have a clear plan in place. For example, brands may hand out a timeline 

PDF that outlines what the onboarding process will look like, including validation, securing financing, etc. 

“Think about buying a car: when you walk into a dealership, they give you a packet that has details about the product and the buying process and that will sit on your counter and keep you thinking about the car long after you’ve left,” said Powills. “What are you giving franchisee candidates that will keep them thinking about the brand and help them overcome some of those common fears? Maybe it is a beautiful one-pager about how you will support franchisees and help them build a legacy for their family — or about how the investment has been designed to ensure first-time franchisees can scale their business.”

How to Streamline the Candidate Journey 

By profiling such a large pool of franchisees, Mainland has been able to amass valuable insights into the typical candidate’s journey. In order to build the right franchise sales toolbox, franchisors need to think through what stages of this journey could be optimized to potentially shorten the sales cycle overall.

“If a candidate doesn’t know anything about the brand or franchising, do you have a way to educate them on your website? Do you have content designed to teach them about the franchising industry?” Powills asked.

According to Mainland’s data, many franchisees loved their chosen brand as consumers before they were intrigued by franchising and signed on. Those candidates will likely research the category and decide whether they can afford the investment. But those aren’t the only deciding factors. Powills says Google Analytics shows prospects often head right to a brand’s “Leadership Page” when visiting a franchise development website for the first time. 

“Candidates want to know how the team will support them in their business,” said Powills. “Whether it be the team’s commitment to the brand, turnover rate or experience in franchising, data shows that this needs to be a part of the storytelling. This can also be brought back into content, including stories about the vision of the brand, an update on the quarter, etc.” 

Once prospects are comfortable with the brand, the investment and the franchise buying process, they inquire. On average, this would be 7.4 months after the initial impression. Overall, Powills says Mainland’s goal is to break down data and simplify processes to help individual brands create the optimal franchise sales toolbox and cut down on that average time by finding the right candidates.

“We will continue to leverage data to help brands adapt their process,” said Powills. “If a client has new openings or signings, for example, we can profile the last 10 franchisees and come up with more insights about how they are behaving to accelerate the sales process. We want to break this down by individual brands, categories and investment ranges, and leveraging data is a great way to do that. Especially for emerging brands, seven months can be a long time to spend money without seeing immediate returns. We have to look at data to provide brands with the best chance at winning and bring in leads with the pathways to least resistance. We only partner with brands that we believe can win in the long run, and we will continue to find the best ways to help them do that.” 

Watch the full Coffee and Analytics webinar here.