eStar explains the risks and opportunities for the franchise model and how to leverage the core business characteristics to compete and grow.
Head Office marketing teams in a franchise business model need to work harder and smarter than any other marketing function to succeed and grow purely because of the way the business is structured.
In a franchise system, the head office entity is in charge of the online channel and essentially need to create intuitive and relevant online experiences to audiences they do not regularly engage with. The issue being, they are two steps removed. They do not usually engage directly with consumers day in day out (step 1), and their physical retail network is independently owned (step 2).
Selling to consumers you don’t understand simply does not work.
Global research proves, retailers who are winning are those who have great connectivity to their customer and great ‘listeners’: they take feedback and turn it into action.
This act of listening is part of a process known as the Customer Experience Design: a proven methodology which brings retailer and customer closer together.
If done right, this methodology turns the physical retail function into a competitive advantage because the foundation for success comes in the cohesion of digital and physical retail channels.
Some recently published statistics to prove the size of the opportunity when physical and digital work together…
- ‘Near me’ mobile searches that contain a variant of ‘can I buy’ or ‘to buy’ have grown over 500 per cent in the past two years, and we’ve seen a 900 per cent growth in mobile search for ‘___near me today/tonight’. – source Google
- 76 per cent of people who searched for something nearby on their smartphone visited a business within a day, and 28 per cent of those searches resulted in a purchase. – source Google
- 88 per cent of shoppers regularly browse products online before purchasing them in a store. – source Adweek
This serves as both risk and opportunity for the franchise model and is where complexity resides for the marketing function.
For the Franchise business model to fully leverage this opportunity requires five core business characteristics to come together…
#1. Head Office Support:
Franchise Head Office fully supports the need to deliver amazing end to end experiences.
Franchise owners rely on head office to define the future. In order to articulate the future, head office must first truly believe it too be the only way forward.
Ironically it is.
#2. Franchise network will to change:
The threats to a franchise model are those organisations who own all the physical locations and can apply change more rapidly. This risk makes the franchise model vulnerable if the owner network is not aligned to a single vision and can work together.
#3. Experience design process to dictate the future:
An experience design process defines what the future retailer experience needs to look like from the customer’s perspective, and by doing so, identifies the changes the retail business needs to make to meet that expectation.
This is a process where its foundation comes from listening, giving the customer a voice in the head office environment.
#4. E-commerce Platform – the ‘experience enabler’:
Selecting an e-commerce platform that can enable the customer experience design plan.
Not all e-commerce technologies are created equal which is why retailers need to know what experiences they want to deliver before selecting the technology.
#5. Vendors who can follow the plan:
Digital/e-commerce vendors who can support and enable the plan. Like technology, not all e-commerce vendors are created equal. Vendors need to know how to configure and structure the technology in line with the experiences the retailer wants to deliver.
Vendors need to be equipped to accommodate iterative development projects so technical enhancements can occur iteratively. This allows the retailer to use data to drive future decision making and ensure all future investments align to customer needs (data represents another form of ‘listening’).
This marketing strategy for the Franchise model of pulling the business model and its people closer to existing customers and the target consumer. By enhancing this customer/consumer proximity, the franchise model can effectively compete and grow.
As Stirling Sports work on a franchise model, the e-commerce solution eStar built includes a custom-built Pricing, Product, Stock integration and a sophisticated pull-based fulfilment routing solution, as well as a custom franchise filter to ensure all franchisees benefit from online orders. Learn how eStar’s client Stirling Sports boosted sales growth here.
eStar is one of Australasia’s leading eCommerce solutions companies. eStar clients include David Jones, Country Road Group, Freedom Furniture, Briscoes, Stirling Sports, Bed Bath and Beyond and many more. www.estaronline.com