Digital Strategy for Franchise Systems
Our Top 20 observations from Bricks and Clicks 2016…
Balance Internet and one of it’s payment gateway partners, Braintree recently had the pleasure of working with Greg Nathan and the team at the Franchise Relationships Institute (FRI) at Bricks and Clicks 2016, an interactive Forum enabling franchisor executives to discuss how technology is changing their business models during June 2016.
Organised by the Franchise Relationships Institute (FRI), the Forum featured a combination of franchisor case studies and leading experts in omni-channel retail, digital marketing, eCommerce and the use of technology to improve franchisee productivity.
Prior to the session FRI’s Founder, Greg, said franchise companies have an extra layer of complexity in how they address threats and opportunities in the digital and technology space.
“Not only do they need to make smart choices in the technology they use, they also have to bring their franchisees on the journey with them. Franchisees tend to be skeptical whenever they are asked to take on initiatives involving extra cost, inconvenience or risk, and when it comes to introducing new technology, you have all three in spades” he says.
“This can leave franchisors scratching their heads on how to proceed, as we all know the best strategy in the work will fail if it doesn’t have the support of the people who have the implement it. This issue is touching all industries not just retail.”
The big questions explored at the Franchise Forum included “How can franchisors ensure their brand is delivering the customer experience in fresh and relevant ways?” “What technology should franchisors be thinking of introducing?” “Who should pay for it?” and “How do franchisors ensure franchisees are using the technology effectively?”
After attending and presenting the whole day, these are the 20 observations and trends I think it would be worth Franchise and Stakeholder based organisations considering. Please don’t hesitate to contact the team at Balance Internet if you would like more information or to discuss your needs.
1) Get the ZZ’s to buy in
The buy-in of franchisees or stakeholders was a clear theme. As online and offline blend in terms of customer experience the technology solutions, digital strategies and business models you deliver have an increased chance of success if you engage and involve your franchisees.
2) Build the Right Business Model
Revenue share and allocation models vary across franchise systems. To align with #1 it was pretty clear that the most successful models were ones that shared revenue or marketing fund budget with franchisee’s and stakeholders based upon a fair and agreed business model.
3) Diamonds in the Data
The data you can extract from Technology Platforms including POS, ERP, Website/Social Analytics, CRM, Loyalty and Email Marketing Systems can deliver realtime insight into your customers needs and behaviour. Aggregate, collate and read this data regularly and use it to make informed decisions across your franchise system.
4) Prioritise based upon ROI
Use point 3 and prioritise actions based upon Return on Investment(ROI). A large amount of franchise marketing activity does not deliver ROI – in the digital world this is measurable and trackable.
For example you can track and measure sales conversion rates both online and in store or agency.
5) ACCC’T the right way with Pricing models
Michael Schaper, Deputy Chair of the ACCC talked about the implications of how franchisors are using new technology might impact on enforcement of the Franchising Code of Conduct. In particular he spoke about pricing models. This is not my area of expertise but I would say ignore price compliance at your own peril.
6) Choose the right Partners and Staff
True digital natives are hard to find. Select your staff, partners and vendors carefully and test their experience and knowledge. Get peer validation of the credentials and ask them to talk through real projects and outcomes.
7) Train and upskill your National Office and Franchisee Staff
Your stakeholders all need to be educated in how to use and optimise your ecommerce and digital initiatives. This will help ensure uptake, advocacy and outcome over time. For example it is likely that some of your aged 50 plus franchisees are not tech savvy and may have a fear of adoption. This could limit the success of your initiatives.
8) Put the Brand First
Brian Walker gave a great talk about Brand as the key part of your digital roadmap. Lead with your brand and ensure it is at the centre of your digital strategy. Digital marketing has emerged as a specialist activity over the last decade with its origins rooted in direct marketing. The increase in the number of personal devices and their use means brand marketers have many more ways of communicating directly and interactively with their target consumers or customers. Given this, branding execution needs to be applied to use of digital media and technology to develop franchise brands through interactions with consumers on the digital devices they’re increasingly using.
9) Wear a SCARF when managing change
Digital Transformation of your franchise means change. Greg Nathan gave a brilliant talk about using models like the SCARF model to manage change. In brief, SCARF stands for …
– Status is about relative importance to others.
– Certainty concerns being able to predict the future.
– Autonomy provides a sense of control over events.
– Relatedness is a sense of safety with others and
– Fairness is a perception of fair exchanges between people.
Great article here
10) Reduce your security risks
This is a personal pet of mine, that you need a digital security strategy to minimise risk. This blog addresses some of the things you need to consider, here
11) Utilise Marketing Automation
Ask the team at Balance about platforms like Dotmailer or Bronto. The platform can allow you to personalise, segment and automate your online communications. This can have an immediate effect on sales.
12) Embrace Loyalty Programs
Many of the franchise systems spoke of loyalty programs and how they can be optimised. Loyalty can be managed digitally with great elegance so take a close look.
13) Increase your digital marketing spend
You should be spending 20% of your marketing budget on digital initiatives. If your not you are behind the eight ball.
14) Consider digital marketing beyond google
To build on #13 don’t just spend all your budget advertising on google with paid ads. Look at the entire digital ecosystem that is relevant to your customers and consider spreading your spend.
15) Integrate your technology systems
The ability to integrate your systems and push product/order/customer data between systems is getting easier and cheaper. For example, you can integrate your commerce and POS systems to get a single view of customer.
16) Map your customers journey through your omni-channel environments
Understand how your customers use all your channels and the pathways they take. I am a big fan of developing customer stories and then mapping their user journeys. It quickly indentifies opportunities and gaps in your digital strategy and technology approach.
17) Utilise mobile technologies and apps
Mobile first please. Most of your customers have smart phones and this is often the most frequent place they brush across your brand. Think about how you can create relevant mobile websites, applications and partnerships that will drive these customers to buy more.
18) Look overseas for inspiration
Retailers globally are embracing digital and building out incredible online strategy. Listen, Look and Learn.
Start with three of my favourite global retailers:
19) Use open source and cloud based technologies
The cost of digital technologies and platforms is dropping. At Balance Internet we love open source and most of the projects we build have platforms like Magento at the core. Cloud based technologies like Vend, Xero, Temando, and Zendesk are also worthing considering. Askthe team at Balance Internet which technologies may suit you
20) Ask your kids or young staff for ideas
I have young staff and even younger kids. Some of the best ideas can come from watching and listening to how they use technology. If they are not already they will soon be your customers