Majority of Franchisees Use Co-Op Dollars for Advertising & Promotion, According to New BIA/Kelsey Report

New report provides insights into franchisee advertising activities and trends, including how they spend co-op advertising incentives across traditional and digital media.

CHANTILLY, Va. (March 16, 2017) – A new report from BIA/Kelsey titled “Advertising and Marketing Trends of Franchisees” reveals 65 percent of franchisees surveyed use co-op dollars for advertising and promotion, with more than one-third reporting that up to half of their ad spend comes from co-op dollars. The report is the latest in a series based on data from BIA/Kelsey’s Local Commerce Monitor™ (LCM) Wave 20 survey of small and medium-sized businesses. This new report specifically examines the media and marketing spending behaviors of the SMBs that self-identified as franchisees or licensees of a national company.

“Co-op dollars present a significant opportunity for franchisees to increase their spending over the next 12 months,” said Celine Matthiessen, VP, analytics and insights, BIA/Kelsey. “Solution companies that are able to report clearly on ad performance and show examples of successful revenue/customer-driven campaigns that result in increased calls to the business and website traffic will have an advantage with franchise SMBs that want to extend and complement co-op programs.”

The report reveals that franchisees are bullish on spending for advertising and promotion over the next 12 months. Half of all franchisees are planning to increase their ad spend in the next year and spend across an average of 20 different ad channels to reach customers. Quick adopters of new technology and advertising channels, the majority of franchisees use a quarter to a half of their total annual ad budget from co-op programs on both traditional and digital channels. Most co-op advertising programs focus on targeted digital such as search and display advertising and traditional channels like direct mail, radio and community sponsorships.

“Any type of marketing and ad platforms that support customer promotions and deals are especially appealing to franchise SMBs,” commented Matthiessen, “It’s also worth noting that the development and use of digital advertising is an area where franchise SMBs report wanting support from their franchisor. Currently, most franchises use their own internal software and services so this is a key opportunity for franchisors to partner more closely with franchisees.”

To examine best practices for how franchisors can help develop campaign plans and marketing budgets for franchisees, the firm recently completed a report for Vya providing industry data. That research is available for download here.

Franchisee Advertising and Marketing Report Availability

The complete findings from the franchisee portion of BIA/Kelsey’s Local Commerce Monitor survey are available in the 55-page report, Advertising and Marketing Trends of Franchisees. The report includes more than 45 data charts covering key findings, such as:

  • Top 10 media used by franchisees for advertising or promotion
  • Ad budget allocation by media category and percentage of ad budget allocated to digital
  • Spending intentions for the next 12 months and factors determining ad spend
  • Use of co-op advertising programs and percentage of marketing costs paid by franchisor
  • Engagement with ad agencies, do-it-for-me, do-it-with-me and DIY solutions
  • Behaviors related to specific ad formats, including mobile, social media, customer lists, customer loyalty programs, leads tracking, websites, reputation management, beacons, mobile POS payments and cloud-based services.

Those who would benefit from reading this report include executives in charge of marketing and/or product development targeted to SMBs, senior leaders evaluating opportunities in the SMB marketplace, any executive with a role in selling digital or traditional media products, and anyone focused on the trends and direction of franchise SMBs. Learn more about this report, including how to order it, at https://shop.biakelsey.com/product/advertising-and-marketing-trends-of-franchisees.

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Local Commerce Monitor™ Methodology

Local Commerce Monitor (LCM) is BIA/Kelsey’s ongoing survey of the advertising behaviors of small and medium-sized businesses. The survey measures where SMBs are spending their advertising and promotional budgets and how their media usage and spending habits are evolving.

The data regarding franchisees are based on the responses of 102 respondents who self-identified as a “franchisee or licensee of a national company.” Of this group, 36.3% and 35.3% are single and 2-5 locations; the rest of the respondents have six or more locations.

About BIA/Kelsey

BIA/Kelsey (@BIAKelsey) combines data, analytics and insights to provide its clients with the information they need for grounded financial and strategic action. Since 1983, BIA/Kelsey has been a valuable resource for many of the leading companies in media and the financial and legal community serving media and telecom, as well as the FCC and other government agencies. Today, BIA/Kelsey offers a broad range of research, consulting services and conferences to traditional and new media companies. Learn more about BIA/Kelsey at www.biakelsey.com.

Additional information is available at http://www.biakelsey.com, on the company’s Local Media Watch blogTwitter, and Facebook. Sign up for one of the company’s three newsletters: Local Media Daily,Local Tech Daily or Local Commerce Daily that cover different areas of media and technology.

Media Contacts:
MacKenzie Lovings
(703) 802-2991
mlovings@biakelsey.com

Robert Udowitz
(703) 621-8060
rudowitz@biakelsey.com