As a young boy, there was always an excitement in finding a new “secret” fishing hole where the “Big Fish” could be found. Often a friend would share their favorite fishing hole – but once the word got out we would often find many heading to the same spot (franchisors often have a similar feeling). For us avid fisherman, we were always looking for new fishing holes and “Big Fish”.
For several decades, many of us have witnessed a variety of lead generation methods and resources. In the journey of reaching our goals, the best have spent a great deal of time, energy and financial resources to find the most efficient and effective form of lead generation. The simple truth is that great lead generation is not a destination – it’s often a temporary stop. As such, the best in franchising are continually evaluating, listening and for the very best… watching the landscape for new fishing holes where the big fish are either going or waiting.
Having been one of the first to use franchise magazines, the internet, franchise brokers, other lead generation resources and tools to set record closing ratios; I have predicted and seen the migration of consumers from one resource to another. The lessons learned from the past can help those today who are facing challenges.
It is of primary importance that we first develop an action plan to have any real chance to reach our goals in the shortest period of time and at a minimal expenditure of expense – this includes determining the following:
- What attributes are found with “Big Fish” or the best candidates?
- Where are they and/or Where are they going?
- What attracts them & gets them to Bite…. To be Engaged?
First- Historically the best candidates (but not the only candidates) have possessed several key attributes:
- They have had a strong motivating force (a fear, an obligation, or a passion or desire)
- They are generally better educated and becoming more technologically savy.
- They commonly are better skilled ( i.e. are professionals, and/or have supervisory, managerial or executive experience)
- They tend to have better credit scores and greater financial resources –including greater assets, net worth, retirement funds and greater current or past income.
- Additionally the majority of franchise buyers possess certain personality types – but in all cases, have different needs, and perspectives of what is important and therefore should be approached differently with customized presentations to produce the greatest engagement and best results (Personality types and effective presentations are an entirely different discussion for another time)
Second – Many of us recall the time when we marketed primarily via the Biz Op sections of newspapers. This was where franchisors found the “best candidates”…. Who possessed many of the attributes listed above. Prior to the introduction of the newer resources and technology that we now have…. The newspaper was a primary source of information for the educated, skilled, and better financially qualified candidate. However, as we started to see the introduction of business journals, franchise magazines and other resources that started to target or focus on specific groups… we also started to see the migration of candidates from the Biz Op sections of newspapers to these other resources. During this time we also saw the emergence of “Business Brokers”(not to be confused with Franchise Brokers) and soon followed by franchise brokers which has accelerated during the last decade. We also started to see the introduction of franchise expos and in the 1990’s we discovered the INTERNET.
Third – What is often not discussed is WHY. Why did consumers migrate from the Biz Ops section of newspapers to these other resources and how that points towards Virtual Events. It is important to understand what has motivated consumers to go to these other resources… in doing so we understand where many have been, where many may be, why many are leaving and where are they going!
In almost every emergence of a new but better lead generation resource are seen several benefits for the consumers…. When you see resources that provide the following you also find consumers migrating in that direction – valuable information for the observant franchisor. These attributes include:
- Greater Convenience
- Lower Costs
- Greater and Easier Access to information
- Superior Quality Information & Selection
- Quicker Responses from experts
- Education preference versus being Sold
- Greater Interactivity and Engagement
Many recognize the gaming devices “Wii”, Xbox 360, Playstation, etc… but remember this started decades ago with bowling alleys, pinball machines, Pacman, Pong, Atari, Nintendo and many precursors to today’s gaming systems… the migration to what we have now is directly related to convenience, easier access, better quality systems, better selection, greater engagement (with better audio, visuals and interactivity – now the controller is a person’s arms and legs… not just a controller).
Once we recognize this – we now know why there is such a massive migration to social media and interest in it…. Understand that a primary driving force with social media is interactivity, access to information, education and virtually ZERO cost. Many of us remember when franchisors were seeing an average of 3%-4% lead to close ratios with internet portals. While still a valuable source of deals, during the last few years challenges have resulted in a deterioration of these ratios. Many are reporting conversion ratios now around ½% more or less (depending on investment level and other factors).
Not surprising, we are seeing stronger franchisor desire to find higher closing ratios and lower total overall costs. As such many have migrated to franchise brokers. The supply and demand aspect of that migration has seen the increase in broker fees (often now close to $18,000 or more and rising) plus the introduction of additional marketing, advertising and even minimum referral fees. The franchise community is also seeing the number of franchise brands being carried by broker groups significantly increasing creating greater competition for franchisors.
Franchise expo costs are also increasing with estimated costs for a major weekend expo often costing $10,000 – $15,000 when one considers “all” of the costs. However attendance has diminished during the last decade – reasons cited often includes inconvenience, traffic, limited access (most are only held once a year in large metropolitan markets), costs (entry, parking, rising gas & travel costs).
With all of these considerations these resources still produce deals with the right planning and use.
THE FUTURE – Many are seeing the growth of Social Media but there is also a new player that has come to the franchise community… VIRTUAL franchise expos. Virtual events are not new… they have been used in other industries with a great deal of success. At a national convention for Virtual Events earlier this year – providers were noting 60% – 300% year over year increases. Of particular note is that providers are noting better quality candidates – better educated, skilled, and financial qualifications. Of particular note were comments from attendees that reflected a 93% preference versus live events. Earlier attempts at virtual expos had significant limitations including platforms that created problems in accessing the event, limited periodic infrequent events, events that were almost expressly “sales” oriented and few exhibitors resulting in little resources to generate traffic. The newest ( and soon to launch) year round virtual franchise expo addresses many previous limitations while implementing strategies that have proven successful with other industries.
The advantages are extensive. Franchise exhibitors today have the ability to “customize” their message, have greater access to candidates and present their concept, and most importantly provide an education platform along with videos, interactivity and “instant” chat features that create better engagement while providing what consumers and “Big Fish” desire.
Are Virtual Events designed to eliminate other resources? Absolutely not! Going back to my fishing days – we often used “Trot”Lines… a long string where several lines with baited hooks were suspended to increase the potential of catching more fish. The most successful continue to use a similar strategy – using multiple resources to cast a wider net to catch more candidates (fish). All the best candidates (fish) are not found in one pond. We have to watch the landscape and be open to try new places.