QSR franchisees: The good, the bad and the exasperating. Part 3: Engage hyperspace

This is Part 3 of a three-part series: Part 1: Franchise who? defines the relationships between franchisor and franchisee and Part 2: Brand Wack-Wack discusses branding.

This series helps brand-side leaders build a stronger group of franchise operators and agency-side account managers understand the needs of their clients. Hopefully some franchisees might be interested too.

Franchisors: Show them the power of marketing like a brand.

Marketing like a brand involves more than advertising. It’s consistent facilities and signage, consistent menus, consistent pricing. Customers expect sameness from any and all locations. Consistency in customer experience drives repeat traffic/loyalty. Otherwise, the entire point of being a “chain” is lost. Only then can you think about talking to your customers and driving trial.

Franchisors: Empower franchisees.

Create an infrastructure of decentralized marketing empowerment, and at the same time, give franchisees the advertising and messaging strategies to push the entire brand forward. Never underestimate the insight that your franchisees can provide. Pool resources for a common goal. It’s a timeless business concept that multiunit, multimarket chains always struggle with. Do we leverage our national footprint and maximize national media efforts, or do we allow our markets to localize the brand and truly connect with customers? Chains go back and forth.

McDonald’s and YUM brand concepts have pushed local spend up and down over the years. Today, they’ve basically walked away from supporting markets and stores. The main reason is national footprint and media efficiencies, but if sales continue to flatten out, a shift to local focus just might come back around.

In my opinion, QSR brands need to strike a balance between leveraging distribution with efficient media reach and providing operators with leadership and tools to own their markets and trade-areas.

Image of employee at fast food restaurant

CEO tells CMO, “maybe it’s time we increase franchisee media buy contribution”.

If that’s really the case, then incremental contributions to a fund should stand for something specific. Selling franchisees on 100 more target rating points of media—which ends up being maybe two more prime spots a week—won’t work as well as creating a distinct box or line on a flowchart. It needs to be something that wasn’t there before. It can be something like a solid level of media to promote a new daypart or product line.

It might be a specific sponsorship that can be easily justified by the intent to bring in new customers. Sports properties, for example, might remark that, “with these incremental funds we’ll be able to have our new chicken sandwich courtside with the local basketball team in every home game. And that will be picked up on region and network television.”

With sports though, you have to be careful, especially with college programs (except, perhaps, in Nebraska or Arkansas where the entire state supports one college). Don’t risk polarizing your customer group based on its fandom. Unite franchisees around a new and bright shiny object that everyone can get passionate about.

So, how does a QSR brand determine right mix of national and local spending? It’s a complicated question. Some of the variables that need to be considered are geography – what’s your distribution foot print? Where are you strong? Where are you week? Where do you want to be?

The old CDI/BDI method of market segmentation needs to be changed. Marketers need to dig deeper than simply sales per 1000 population. They need to create their own “universe” based on store location to calibrate spending.

In the early 2000s, Sonic’s ad spend in Texas represented around 10% of total spend. As a regional brand, with little or no distribution in New York City, Chicago and Los Angeles, this made sense. The question was, should we shift spend from all local co-ops, including Texas, for the sake of more national presence, even though we hadn’t reached network efficiencies. We concluded that national spending lifted Texas along with the rest of the system. We looked at real costs and found a balanced mix between local and national. That said, as media channels evolve, as cost go up and down and as performance varies between markets, frequent recalibration is important.

Is the :30 TV spot dead? Is social/digital the only way to go? No and No.

There are some givens. Unless you have critical mass and many points of distribution in New York, Chicago and Los Angeles, nationwide or network media probably doesn’t pay out. However, national exposure can do some really good things to a growing brand.

The crazy fluid nature of social, digital and traditional media eliminates the idea of “all of your eggs in one basket” media-planning. The mobility of today’s consumers, both literally and virtually, between where they live, where they work and where they go to dine and have fun, requires that your brand covers most of those bases effectively and efficiently. To figure out where and how to prioritize your ad spend in this ever-changing landscape, run your brand through our proprietary Brand JuJu Index.

But don’t take your eye off your biggest and most efficient reach channel to your customers.

The hottest new channel for your customers, let’s say a millennial-targeted social media platform, may be something interesting to keep an eye on, but be careful. It’s probably not something that you should allocate resources to if it means you’ll be less dominant in traditional spaces that have huge reach, especially if it’s where your competitors are.

Be creative for goodness sake.

Let’s say you’re a regionally strong restaurant chain based in the Midwest. Your competitors have national distribution, and therefore, network options are effective and efficient for them, but not for you.

Consider things that have national reach but are weighted towards your geography, like buying presence on a national sports channel to hit games/schools whose fans are primarily in states where you operate. A game will be watched across most of your core markets and some of your developing markets. And, if it’s a big game, probably 10% of the other fans in the country will be watching it. Hey, it’s THE big game.

So with one purchase, funded by all of your locations equally, you’ve pushed your message out to all of your designated market areas, and, by the way, hit the entire nation. Some media planners would call that “waste exposure.”

The goal should be to tap into new customers without alienating your existing customers. Connect via traditional and digital media with the right brand building message in the right place at the right time.

You’ll open your doors stronger than ever.

So, this concludes some of what I know to be true in the QSR franchise business. It’s crazy, it’s fun, it’s fast-moving, competitive and it can be incredibly rewarding. As mentioned in Parts 1 and 2, it’s generally about smart folks and their family. Folks who have come from humble beginnings. Fun people, again, generally. Franchisees represent the salt of the earth. To me, they’re the perfect example of what the American Dream can mean. If you’re meeting a franchisee for the first time and want to get to know him or her, here’s my advice. Just ask one simple question, “how did you got into the business?”

The answers to that question, I’ve come to find, come in the form of:

  1. A great story, funny sometimes and sad other times
  2. A story they love telling. After all, it’s about their success
  3. A story that will give you invaluable insights into their personality and what’s important

Here’s my advice to franchisors:

Don’t forget the value of brand localization. You might get your hands dirty. You might have to spend some “windshield time.” You might have to hire people. In today’s ever-changing media landscape and over-saturation of restaurants, the key brand differentiators, will always be product quality, service quality and relationship to the local market.

Here’s my advice to franchisees:

Participate and voice your opinions. Join some committees. Continue to demand support from your franchisor and spend incrementally to support your local markets. If your franchisor isn’t providing resources and guidance, find it for yourself.

I recently talked with one of the biggest franchisees in the country regarding what his franchisor provides. It turns out face-to-face meetings have become too costly, and have been replaced by massive conference calls. Technology now provides portals to access ad slicks, social media content and media templates. What he’s looking for is help. Someone to sit down with him and his boss and talk strategy.

Greg Haflich is a 35-year marketing veteran with agency and client-side experience. Some of the brands he’s had an impact on include: Rent-a-Center, Chrysler, Applebee’s, Sam’s Club, KFC, Pizza Hut, On the Border, Krispy Kreme, Sonic, Subway, PF Chang’s, Pei Wei and Shoney’s.

Callahan is a brand strategy and digital marketing agency in Lawrence, Kansas—34 years strong—with expertise in the chain restaurant, beverage, pet and home & garden categories. It drives sales for clients using a wide range of tools, including traditional advertising, in digital spaces with a nationally acclaimed social media team. Callahan proprietary brand health tool—the Brand JuJu Index—was launched in summer 2016 to help clients outsmart vs. outspend the competition.

Want to receive our weekly blog insights? Subscribe now.