This article was originally published in 2009, as Franchise Candidates: A Changing Mindset and then revised in 2014 as, Franchise Candidates: A Changed Mindset.
Now, revised today under its current title, the article may be more relevant as franchising continues to evolve AND rebound from the pandemic and its unprecedented challenges. Compounding these challenges include the necessity of developing and implementing plans to address the looming recession and how the same could potentially hinder recovery plans and squash growth initiatives.
Franchise brands will continue to explore and invest in more viable, effective lead generation strategies in order to stand out in an increase in industrywide efforts to attract franchise candidates. Think of the increasing number of franchise expos & shows and franchise broker (consultant, coach) networks as cases in point along with the proliferation of new franchise portals and lead generation companies. And let’s not forget the influx of ways to distribute content including podcasts, video, blogs and now, the metaverse!
Further, franchise brands are continuing with their commitment to social media and digital marketing having [finally] realized their positions as integral and effective components of these strategies. Sadly, but not surprisingly, a significant number of brands still have not realized the potential of doing so according to an evolving integrated plan thinking these marketing efforts are solely line-item costs as opposed to an investment/expense hybrid.
A look at today’s franchise candidates will reveal they are more sophisticated, better educated (academically & professionally, as well as self-educated), and more technologically advanced than ever before. Demographically as well with more females and minorities (including a growing number of immigrants and refugees) seeking business ownership as a way toward self-independence. Multi-generational partnerships are adding to the mix.
In addition, and possibly even more so due to current economic uncertainty and challenges, including world events, the mindset of today’s candidates, regardless of background tends to be somewhat unsettled or uncertain in thought. Ultimately, this creates a sense of uncertainty and hesitancy in moving forward. Caution is a common thought expressed by today’s candidates.
To that end, today’s candidates are spending more time researching options and opportunities and doing so at a much slower, deliberate pace. In order to be diligent in the process, more time is being spent online reviewing page after page of information, constantly bookmarking, and moving back and forth from new information to saved information. They’re comparing notes for consistency across one platform to another as well as with other franchise candidates on social networking sites. As well, they’re gaining invaluable insight monitoring online discussion groups and forums.
Ultimately, today’s franchise candidates desire and need to be certain the franchise opportunity is as close to perfect for his or her (or their) situation, and as humanly and practically possible.
Especially after previous recessions, franchise candidates have used their capital gains to invest in franchise opportunities, often being able to leave their principal investment untouched. There was a sense of throwing caution to the wind because they were investing profits, often considered as found money from ungodly profits, at least by today’s standards. Does anyone remember when money markets kicked out 17% returns?
Unfortunately for the typical franchise brand but possibly and rightly so for the future of franchising, a multitude of individuals looking at franchise opportunities today are looking at things differently. They have to. They must.
Many are transitioning corporate executives and mid-level managers staring at the back end of what were previously described as great career paths, now trying to squeak out just five or ten more years before they actually retire, or when they could afford to retire. Facing the challenge of younger talent, new technology, a rapidly changing business environment, along with living longer lives many opt to “buy” another job and explore franchising and small business ownership.
What has Changed?
Here’s the difference between today’s recession, and of those in the past. As huge fortunes have been lost, and large gains have not been realized in current financial markets, today’s candidates are forced to invest all or part of their remaining nest eggs in order to enter the world of business ownership. Of course, most everyone knows and somewhat understands the risks (or that there is risk) involved in owning a business. But in yesterday’s business environment, many franchisees and business owners were “gambling” with profits.
Certainly, no one wanted to lose money in a business venture. But many had fallback positions with funds still in retirement accounts and if they had to, continued employment including second and third jobs.
For many of today’s candidates, failure is not an option because fallback opportunities are fast becoming more challenging. Maybe even more so due to recent views and actions against side-gigs & freelancing and monitoring of Venmo & Pay Pal transactions. Actually, I believe many of today’s candidates might not have even considered franchise or small business ownership in the past. For tomorrow’s candidates that may be even more the case.
So, as many individuals explore their options, they will focus more and more of their efforts online. Franchisors must embrace this fact and continue to dedicate more resources to the internet and expand their efforts within social media to complement and enhance their traditional franchise marketing strategies. They must focus more and more on bringing their messages directly to their audience as opposed to just relying on attracting them, and in an interactive way. By doing so, they’ll realize multiple benefits for their entire system including:
– Developing and strengthening brand awareness with franchise candidates and consumers alike – including those who may not know much, or anything about franchising, or quite frankly about the brand itself.
– Generating franchise leads that are genuinely interested in exploring entrepreneurship and to that end what franchising and small business ownership have to offer.
– Introducing particularly new industry segments that may include opportunities that could be the right fit for candidates to achieve their goals and objectives.
– Establishing an interactive environment of information sharing, communications and education that will become the backbone of future franchise relationships throughout emerging and legacy franchise systems alike.
– Creating positively memorable experiences and the right culture for franchisees (as well as for all brand stakeholders) the foundation for future growth fostered by excellent validation and multi-unit development.
Last, many franchise candidates previously viewed franchising and small business ownership as a way of achieving their wishes, hopes and dreams, regardless of what those may have been. Today, it’s more about goals and objectives, AND necessities. All within franchising must fully realize this and understand the evolving mindset of today’s franchise candidates in order to survive and grow today, and tomorrow.