What marketing support will I get from my franchisor?

When joining a franchise, marketing is often one of the first areas new franchisees want to understand. How much will I need to contribute? Can I run my own campaigns? What support will the franchisor provide? Here, leading franchise experts explain how franchise marketing works and what to expect.

Do I have to contribute to a national marketing fund?

One of the first things franchisees ask is whether they must pay into a central marketing fund. John Pratt, senior partner at Hamilton Pratt, explains:

“The majority of franchise agreements contain an obligation on franchisees to contribute a marketing levy… This levy is put into a separate marketing and advertising fund. This therefore guarantees to franchisees that it can only be used for marketing and advertising.”

Pratt notes that while this ensures funds are ring-fenced for marketing, there is a downside:

“Payments will be used in ways that may not suit all franchisees. Usually, franchisors have discretion as to where the fund’s money is to be used. There is no guarantee that any marketing activities will directly benefit any franchisee.”

Some agreements delay contributions until the franchise has recruited a minimum number of franchisees, often around ten. However, franchisors often want to build the fund from the start, even if initial contributions cannot finance a major campaign.

What other marketing contributions might I need to make?

Different franchisors don’t necessarily handle marketing contributions in the same way. Shelley Nadler, legal director at Bird & Bird, explains the common approaches:

● Franchisees pay a percentage of gross income directly for advertising, which the franchisor spends on promotion.

● Advertising and promotional costs are included in ongoing franchise fees, with a minimum percentage guaranteed for marketing.

● The franchisor conducts marketing activities at its discretion without collecting a specific contribution.

Nadler adds that some franchises prioritise local or regional marketing over national campaigns. In these cases, you may have to spend a fixed percentage of gross income on local marketing.

Can I market my franchise locally on my own?

Once you’ve understood contributions, the next question is autonomy: can a franchisee run their own local campaigns? Nadler advises:

“The franchise agreement should explain the franchisee’s obligations or rights to carry out local advertising… Where the franchisor does permit or require local advertising, the franchisor will insist on control of the form and content of all advertisements and promotional material. [This is] in order to protect its brand name. This is to ensure that standards associated with it are maintained and to ensure uniformity across the network.”

Louise Harris, principal at Franchise Projects, adds: “Your operations manual should guide you on what marketing you can and should do – and what you should refer to your franchisor. The manual should clearly articulate collateral, style, brand guidelines and routes to market, along with expectations of monthly or annual spend on marketing.”

Vicky Wilkes, head of legal at Aston Villa Football Club, highlights the legal importance of brand control: “Irrespective of the franchise, there are likely to be strict guidelines on how you can use any trademarks and branding relating to or associated with the business.

“Control over trademarks and branding is key to a franchisor protecting the franchise brand’s integrity and goodwill.”

Do I have any say in how the franchisor markets the brand?

Franchisees often want input on national marketing. Alan Wilkinson, head of franchise development at The Franchising Centre, says: “Somewhere along the line a franchisee will have a great idea and put this to the franchisor.

“The franchisor should then investigate, trial and if successful, launch this idea into the network for the benefit of all franchisees… Any good franchisor should welcome input from franchisees on ideas and recommendations on how to use this marketing budget.”

However, Wilkinson stresses that the final decision rests with the franchisor: “It’s very well placed to make these decisions for the benefit of the brand.”

Pratt adds that accountability is also key: “A great majority of franchisors charge a separate marketing fee. This fee can only be used by the franchisor to market and promote the franchisor’s business and the businesses of its franchisees… Sometimes franchisors agree to have the marketing account separately audited or certified by their auditors.”

What marketing support will a franchisor provide?

The level of marketing support varies between franchise systems. Brian Duckett, former chairman of The Franchising Centre, explains: “At its simplest it may just be examples of adverts you are free to place in whichever media you choose.

“Other franchisors will provide you with a central advertising booking service, which will advise you on the most appropriate local media for your product or service and enable you to get the best rates.

“Most franchisors will collect fees from all of the franchisees and use the funds to place advertising in national and regional media.”

Duckett adds that effective guidance can save franchisees from wasted spend: “Franchisors should know better than anyone what sort of advertising works best for their franchisees.

“Sometimes the best support they can give is to stop you wasting your money on useless schemes and help you prepare an effective media plan and marketing budget for the local promotion of your business.”

Will I receive training on social media marketing?

Nadler notes that franchisors are all too aware “of the risks and liabilities associated with improper social media management… All good franchisors should provide training to their franchisees on the use of social media and have a social media policy in the operations manual.”

Training can include content guidance, templates, audits and instructions on handling complaints. Nadler adds that some franchisors even create individual social media pages for franchisees to manage with oversight.

Conclusion

Marketing in a franchise is a partnership. Contributions to national funds are common, but the franchisor usually retains control over spending.

Franchisees may provide input, but must follow brand guidelines and seek approval for local campaigns.

Practical support – from advertising examples to social media training – varies by franchise and is often proportionate to network maturity. Harris advises: “It is a topic you should explore thoroughly with any prospective franchisor to make sure that you are comfortable with what [they] expect of you.”

Understanding your obligations, the support available and the rules around local marketing ensures you can effectively promote your business while protecting the franchise brand.