Franchises are “brands in motion”.
Whether global, national or local, they have a distinct identity with physical, “brick & mortar” locations.
The franchise model can get complex and there can be many moving parts. Operations, marketing, internal onboarding, business reporting -- and that’s the tip of the iceberg.
But before you get bogged down with the details, we’d like to help you zoom out and give you a set of core 4 Cs that can help you understand the broad areas at play -- and pinpoint the spots your franchise brand might need to address.
1) Customer Experience:
When it comes to franchise operations, customer experience is exactly what it sounds like.
From A to Z, it is the entire journey, from the moment a customer steps into the physical location and takes in the store’s atmosphere and associates, to the help they receive in purchasing or the guidance they receive on a menu item to the actual transaction and sale to the minute they walk out again -- and it can even involve follow-up actions by the franchise.
And it doesn’t end there. Customer experience is about how many times a customer will have this same positive experience.
Each time they do, their trust grows and they demonstrate brand loyalty. This means they’ll pick your chain over all other competitors simply because of customer experience.
Yes, customer experience can be a competitive edge!
And there are 4 major problems when it comes to franchise customer experience
- A failure to measure customer satisfaction and location performance based on actual financial outcomes
- A failure to identify exactly where and what specific action needs to be taken; instead, they operate on general, company-wide changes that cost too much to deploy (and don’t often address the problem anyway)
- A failure to start with specific, simple and cost-effective improvements by location
- A failure to get feedback continuously and trace the source of issues fast enough to take that specific action
The language of love is not about flowers, frills or long walks on the beach.
It’s about effective communication between partners. Everything else is window dressing.
(Well, almost everything else.)
Now substitute the word “love” and “partners” for “franchises”. Franchises, like any organization or body that is essentially made up of people, depend on the trust that is nurtured with effective communication.
For franchises, well-planned, streamlined communications can be just as much a necessity as a smart business strategy.
This means internal communication between a franchisor and franchisees and employees, as well as external communication with customers.
What does successful communication in franchises look like?
Follow up with geographically-distant franchisees either on one internal platform or by traditional means of phone, email or field manager on a regular basis to:
- share ideas,
- successes and,
- pinpoint issues before they escalate.
Celebrate individual franchisee success by sending a hand-written note or a small token of your appreciation so that they know you’re in-the-know and their efforts and not going unnoticed. If you share a common communications hub, post it there for all to see.
Accomplishments, feedback, meeting targets or just sharing a great idea -- these are all fair game. Positive reinforcements do wonders for future work performance.
Another way to allow franchisees to feel heard and supported is to establish an internal “help desk” team. They should also feel empowered enough to feel as though they can fire off an email to a supervisor or field manager and know that they’ll receive the answer.
Going the extra mile to follow up with a customer in a personalized, one-to-one interaction, with brand-specific packaging, note-cards or promotions based on their previous sale -- these are all excellent ways to communicate a customer’s value in a nonverbal way.
Seeking feedback in a consistent way is absolutely integral to innovation on future offerings and products for franchise brands.
But taking the initiative to find customers that have expressed dissatisfaction -- in forums, on websites, and through social media, for example -- and take corrective action results in a customer for life.
If you don’t believe it, consider these statistics:
85% of customer churn because of poor customer service is preventable
67% of customer churn is preventable if a customer’s issue is resolved on the first engagement.
Of course, it’s not rocket science that some of these techniques are as true for the external brand-customer relationship as they are to the franchisor-franchisee relationship.
This is because of two very important points that franchisors always often miss:
- The internal state of a franchise always shows up in external communications
- Trust is at the heart of any interaction that eventually blossoms into a relationship
When done right, consistency is both a concept and a practice.
Consistency in franchises touches its operations, communications, business strategies, customer experience measurements, brand elements and motifs, messaging, follow-up, outreach, product testing, marketing promotions, innovation and internal compliance.
Each of these specific spheres have practices that can be (and must be) put into place on a regular basis in order to a) learn any real information of value that can be used for improvement and b) build a foundation of trust and loyalty between people.
Sometimes, the simple truth is the hardest to swallow: quality-control in franchises can be as easy as consistent quality and customer service across locations. One brand, one experience.
This is because, especially in the service and restaurant/cafe industries, people unconsciously associate the quality of the product with the quality of the service they received.
If the quality is consistent (and consistently high-quality), it increases customer trust in the brand and heightens the customer experience in a positive way. The benefits to franchises, of course, show up in the bottom line.
Research shows that 55% of consumers are willing to pay more for a guaranteed good experience and 86% are willing to pay more for an upgraded experience.
Unlike communication issues, that can be understood of as a mirror, and customer experience, which is a journey, issues of compliance are best understood as a snowball.
Think about it like this: when issues of noncompliance begin to occur with a franchisee, they are usually small infractions like missing a logo on newsletter communications with customers, or not reading about a recent change in brand language and terminology employees can use on the floor.
The issues may look different in specifics but noncompliance is always the same.
These issues usually snowball, when multiple instances go uncorrected for too long, into bigger issues: missing customer reward programs or, failing to order supplies and food items from an approved supplier that has recently been changed -- both scenarios leading to an inconsistent customer experience and guaranteed loss of profits and brand equity.
It’s not as simple as an issue of franchisees “flouting authority” or “not caring enough”, which are some of the corners franchisors are prone to taking right away.
Issues of compliance in franchise operations go to the very heart of the franchise operations manual and the franchise agreement. Rules and franchise standards are set in the agreement and operations manuals but they also accompany penalties for flouting or breaking the rules.
A franchisee who does not comply because they have simply failed to read the agreement carefully or put the manual into application on the floor runs the risk of incurring heavy penalties (fines or terminations) that could have been avoided if compliance was present from the get-go.
In these cases, a franchisor might be reluctant to enforce either because the circumstance may not match the severity of the penalty. To mitigate any issues of compliance arising at all, there must be a way for franchisors to do two things:
- Provide the documentation and resources required to help a franchisee to see and realize they are sliding and how to get back into the fold again
- Make it easily accessible, across all platforms, for the franchisee and make it trackable for the franchisor or field operations managers.
Now, let’s focus on the intersections and franchise brands that get it right!
At the intersection of customer experience & consistency is brand recognition.
One of the most recognized brands in the world -- whose golden arches are more recognizable, supposedly, than the cross and No. 7 in global brand rankings -- McDonald’s brand strength still dominates its peers.
A consistent customer experience has recently been put to the test as McDonald’s now offers new Signature Recipes menu, globally, and self-serve kiosks, all-day breakfasts and a coffee and juice bar.
Granted, none of this innovation could have come about without trying to gain consistent customer feedback.
But the addition of a new arm -- its coffee and juice bar -- as well as self-serve, automated touch-screens for ordering and payment -- is now part of the customer’s experience.
To add to the brand’s strategic elevation, many physical locations are receiving a facelift -- not only to make way for these new menu staples and technology but also to give a more polished feel for its customers.
The message they’re trying to convey is, “come on in and stay awhile.” And, at a $37.4 billion brand valuation, you can say, it’s working.
Consistent compliance means better internal cohesion.
Cohesion is a hallmark of the well-established Swedish coffee chain, Wayne’s Coffee.
The coffee company styles itself as a place that “offers the opportunity to take a spontaneous break from everyday life to enjoy a moment of relaxation, socialising and pampering.”
In order to maintain a consistent level of high quality, Wayne’s Coffee features exceptional menu items along with an ambiance that is geared towards guests coming in, finding a place to socialize, unwind and relax.
Wayne’s Coffee is not a Europe-only operation. It also has in its fold multiple locations within the Middle East, with demand for locations across Saudi Arabia and Jordan. Across their Units, 40.000+ guests are served daily
So how does a global franchise with a fast-growing rate of 27% per annum maintain consistent compliance?
When it comes to internal cohesion, daily operations are the focus and these must be streamlined in order to make customer experience consistent and internal operations sane.
The last thing franchisors of Wayne’s Coffee can be dealing with is simple issues of franchisees failing to open important emails, implementing promotions with marketing materials or missing out on preferred suppliers that help Wayne’s Coffee establish their high-quality menu items as their competitive edge.
To bring daily operations together with compliance on standards, Wayne’s Coffee opted to use an intranet solution where all company communications, resources, materials and updates would live.
Role-based access meant that they could even bring on employees, front of house and back of house staff or associates into the mix, giving each tier of employee the access that was relevant to them and their respective markets.
For franchisees, it was support that felt like a 24/7 help-desk -- except that they were empowered to locate the materials easily and quickly themselves through the intranet.
For franchisors it was a no-brainer way to live up to their end of compliance in delivering updated, critical and relevant information throughout the network.
When customer experience and communications come together, you have superior customer relations built for the long run.
Customer experience coupled with communications can involve anything from responding to customer queries, following up on feedback or building a superior product that helps the customer articulate and build their own relations.
Card Group is one such franchisor. The Swedish-based franchise focuses on the business of helping people and businesses “communicating IRL”, quite literally, and “connecting” with those who matter to them.
The innovative franchise idea installs their displays and product offerings in various locations/shops and offers support on installation and sales as well as spotting new opportunities to introduce products to customers.
Here, the customer’s experience is built into a high-quality product. Card Group’s premium greeting cards and beautifully packaged gift cards are a natural draw for customers who are themselves interested in maintaining relationships.
Card Group is currently operating in 45 countries. One of the most important building blocks of their success is consistency, and the fact that they never allow for any deviations from their concept, brand values or best practices.
To maintain consistency, all three of these are well defined in updated Operations Manuals shared across the network.
And compliance that intersects with communication spells trust -- a customer’s trust, as well as a franchisee’s trust in its franchisor and vice versa.
Communications and compliance -- which boils down to talking informatively with franchisees about franchise rules and regulations -- are the key in setting up operations on the right foot.
Doing so means that a customer’s trust is nurtured from day one.
Imagine a Kumon center being opened in your local area. The brand offers franchise opportunities to individuals on a very stringent basis: those who are interested in the opportunity must undergo a background criminal check as they will be working and interacting with children and families.
Franchisees must also undergo training of the Kumon method as this is the brand’s product and service, all wrapped up into one.
While franchisees benefit from the marketing materials the brand provides and the tried-and-true approach of the Kumon method being a big draw for families, whether they can nurture that trust long-term hinges on:
- If they can fulfill parents’ (and children’s) expectation of superior educational gains
- If their knowledge of the Kumon method coupled with hiring exceptional tutors can be consistent
In this case, compliance with the nuances of the method and training are the main backbone of making a Kumon franchise operation successful.
Here’s the thing: as much as we try and separate these concepts for easy digestion and understanding, they are inextricably linked.
It’s why they are best understood as a moving, breathing sum of parts and why we’ve built an intersection Venn diagram to represent how organically they’re tied together.
You cannot undertake an overhaul of one without the other. So we recommend you stop trying to compartmentalize and introduce a solution that is simple enough and yet powerful enough to simplify the management of your business right now.
Once you commit yourself to change, there’s no going back. And if the proposed change is the right one, it won’t bring on disruption... without the the soothing balm of solution.