The Technology Changing Franchise Development

For decades, franchise sales teams relied primarily on roadshows — traveling expos held at hotels and conference centers, where franchisors would pitch their opportunity to interest and captive prospects — to find new franchisees. In the late ‘90s and early ‘00s, the internet offered a new way to reach potential investors, and franchisors began relying on franchise portals to list their opportunities. Though the audience had grown, the strategy was essentially the same: find where prospective investors are looking, and put your brand in front of them.

That strategy was effective — pitching to the warmest leads is rarely a losing bet — but it was limited. Franchisors were reaching only the prospects who were actively taking steps toward investing, missing entrepreneurs who hadn’t considered franchising in general but might be amenable to a particular concept.

Then, in 2008, everything changed. The Great Recession simultaneously sparked an influx of new investors looking for reliable ways to generate and protect income and caused franchisors to tighten their belts, in many cases cutting spending on franchise sales.

The confluence of new investors and less spending on sales resulted in creative new approaches to lead generation, many of which took advantage of the rise of social media and new digital tools that brands were turning to for consumer marketing.

That trend has persisted for the past decade as franchisors continue to diversify and refine their strategies, increasingly taking advantage of cutting-edge technology to boost the quantity and quality of their leads.

To learn more about how franchisors are using technology to improve their sales strategies, 1851 talked to two franchise development experts. Scott Thompson, the current senior vice president of global franchise development for Tutor Doctor, has held development positions for a range of franchise brands, including Maid Right, Jan Pro Cleaning Systems and FranConnect. Dawn Abbamondi worked in development positions at Sunoco and FruitFlowers Franchise before becoming the director of marketing and brand development for SMB Franchise Advisors*.

Thompson and Abbamondi agreed things have changed, and too many franchise brands remain stuck in the past with their development strategies.

1851: What is the most important change in franchise development over the past ten years?

Abbamondi: Perhaps the biggest change is the method of outreach. 10 years ago, e-mail wasn’t on everyone’s phone and no one would have answered an email from their workplace. Now, even a quick text to check in on the status of an application or to see if someone can get on a quick phone call is fairly common and easy to manage.

Thompson: The biggest change is that we are using more and more digital, content marketing, online storytelling and data-driven, persona- and geo-targeted campaigns to recruit the A-level franchisees that are most closely aligned with a franchisor’s ideal candidate.

1851: What are some other tech solutions for development that franchisors have at their disposal today?

Abbamondi: I have seen some really wonderful automation in CRM and lead-management software. The sky's the limit with these things today. Auto-response emails, advanced drip campaigns and retargeting can really keep a brand in someone’s mind after they inquire or search online.  

Thompson: AI and marketing automation are big ones.  We need to serve up content to a buyer at the right time to make them feel special and uniquely connected to the brand, and those tools allow us to do that more effectively than ever before.

1851: Have you seen any franchise brands struggle to catch up with the new world of development?

Abbamondi: Yes, but the most important thing is you have to be careful to align your development strategy with the way you want to grow. Some brands are a bit more passive and wait for a candidate to reach out, but that creates a long and slow growth cycle, which will probably cost more money in the long run. If you want to grow, you have to be ready at any time to talk to a candidate when they want to talk to you, and you have to be ready to engage with them the way they want to do so; online, virtually, in person, text or phone calls. I don’t think there is anything that you need to move past, maybe other than faxing. I don’t see a need for that anymore and don’t miss it one bit either.

Thompson: Yes. The idea that more leads equal more deals is an old way of thinking that some franchisors can’t shake. That philosophy falls victim to the law of diminishing returns. You also need to have a strong pre-qualification team that is trained on the process and how to ask the right questions to get a prospect to commit to an appointment with a director.

1851: What are some tech solutions for development that you are particularly excited about?

Abbamondi: There are so many that are doing great things, much of it comes down to personal preference, what you want to see, how you want to see it and when. Dashboards are a must, providing a level of detail that’s as granular as the development team wants to go.  

Thompson: I personally like Hubspot and ZOHO among other marketing platforms. They have helped us go from an average of eight deals per month to 16.

1851: Are there gaps or difficulties right now that you’re hoping to see solutions for?

Abbamondi: Once a deal gets to the contract stage, I think there is still a lot of room for improvement in the process. There are big, legacy systems out there, like DocuSign, which have come so far in the past 10 years, but they can still do better.

Thompson: Yes. We still have no way of knowing exactly when a prospect is ready to buy. AI could become a big help there. I’m hoping to see AI that will find the exact buyer when they are online ready to buy.