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How The New Internet Changed Franchise Lead Generation

My first day in franchise lead generation was January 6th, 2014.

I showed up to FranchiseHelp, bright-eyed as the newly hired “marketing guy,” ready to learn everything there is to know about how potential franchisees found information about opening a location on the internet.

And four-years later, a lot has changed in the industry but perhaps nothing more than oft forgotten and hidden constituent in our world, the leads themselves.

Here are the three biggest things that we’ve noticed:

More Information; Less Action

Franchises have long been the gatekeepers of the information necessary for a prospective entrepreneur to become a franchisee. Between intro calls, franchise kits, FDDs, discovery days, and the agreements themselves, franchises always controlled the narrative. And controlling the narrative means allowing your sales process to dictate how franchises were purchased.

In today’s world, the amount of information out there about every franchise far outstrips the information you have the ability to provide leads. They don’t need you to tell them what it’s like to own one of your locations anymore because there is simply plenty available for them to consume on the web. The Google version of the world (and the one we live in…) is one where the answer to any question is available to anyone, anytime.

While all publicity is good publicity, there’s an inverse relationship between information and action on the web. As people are inundated with the ability to get what they need on-line, they become less and less likely to do anything else that you ask them to do. (Do you donate to Wikipedia?) It used to be that doing something like filling out a lead form was rewarding in that you got something you otherwise couldn’t have. Now, it’s all there for the leads.

More People Willing to Provide Contact Info; Fewer People Want to Talk

Phone conversations have long been the life blood of every franchise’s sales process. While there is certainly a role for e-mails, texts, in-person meetings, and even direct mail, there’s not a franchise sold in America that doesn’t involve the two parties speaking on the phone multiple times. When you speak amongst yourselves as franchisors, the metric is always “I want to have more conversations.”

Getting people to provide contact on the internet is not easy, but believe it or not it’s gotten easier to do so in the past few years. Four years ago, we were at a relative peak of identity theft paranoia. When you asked someone for their phone number on the internet, it was almost as if you were asking for their social security number and credit card pin. Now, we’ve reached a better place with leads. While it’s still hard to get contact information, it’s gotten easier.

But more contact information doesn’t mean more conversations! And this is something that all businesses are feeling these days. We often ask ourselves something like “Who gives their phone number (which we verify), but won’t answer a phone call?” (The answer is many, many people…) However, it seems that the tide will never turn on leads desire to answer their phones. Call answer rates have never been lower, especially given all the various ways you can communicate this year.

More Ways to Communicate With Leads; Each Is Less Effective

How you communicate with your customers is the lifeblood to any successful business. Some businesses it may be necessary to communicate on a daily basis while others it may be as infrequently as annually. But no matter what, a core competency of your organization must be those relationships. Simply preceding the necessity to communicate with customers is of course communicating with leads, the growth engine for your organization.

Four years ago, there were only two main ways businesses were communicating with people, phone and e-mail. In the last four years, text messaging has certainly come into its own in terms of effectiveness. However, more interestingly than the rise of text messaging is the next set of technologies on the horizon i.e. WhatsApp, iMessage, Facebook Messenger, FaceTime, Hangouts, SnapChat, Slack, etc. Leads have never been more equipped to communicate with various groups of people the way that they want to.

With the fragmentation of communication methods amongst leads, each individual method becomes less effective. Salespeople and marketers like a world where it’s painfully obvious how people communicate with each other. When its between 20 different options, good luck choosing the right one to use. As time progresses, there will be diminishing returns on phone calls, text messages, and e-mails, while these others take hold.

Of course, as the leads have changed fairly quickly over the last four years, the franchisors who we service have moved slower. (This is not surprising as businesses often lag the market in terms of innovation.) This is something that has alternatingly been a source of both consternation and motivation for me. You want your customers to want to innovate, but you don’t want them to do it without you!

And so now, the state of the franchise lead generation world is in some sort of odd stalemate. Franchisors are left yearning for the lead generation world that existed in earnest a decade ago, while leads are wondering why their phones keep ringing from phone numbers they don’t recognize.

When I imagine how this issue ends up resolving itself, there are three various scenarios which I imagine playing out:

1. Rich Get Richer

In order to compete in this new world, it takes a commitment in terms of both hard costs and people costs. The franchisors who are most able to deploy these types of resources are, of course, those who have them! It’s not too hard to think that it’s the little guys who lose.

2. Technology Companies Rule

If it is possible for variously size franchises to compete, then it’s possible that everyone has to pay the price. Technology companies love to operate in tech-unsavvy spaces. Why? It’s a easy playbook. Find a solution to the problem. Spend a lot of resources getting customers to adopt. And then slowly raise prices over time, squeezing customers' margins.

3. Necessity Births Invention

The internet has changed the lead generation world permanently. It’s not going back. Franchisors currently struggling to cope with these new facts are only going to find it get harder. The people and institutions at and serving franchises have to adapt to the changing tides. The way of thinking and strategies need to modernize quickly, or it’ll be too late.

For our part, we want to work with all the franchises out there looking for how to meet their annual development goals. We know it’s difficult to sell franchises in the age of the internet; it’s something we deal with every day.

Let’s have a conversation. What was your experience with using lead generators in the past? What went right? What went wrong? We help franchises in all shapes and sizes, and we should be able to help you too.

Eli Robinson is the COO of Metric Collective, the parent company of FranchiseHelp.

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