DHVTSU

Chapter 3
The Franchise
Marketing Process
Contents
1 The Strategic Planning in Franchising

2 Steps in Strategic Planning

3 Product and the Marketing Mix

4 The Product Life Cycle

2 New Proudct Development

 Marketing as defined by Kotler and
Amstrong (2012)
• Marketing is managing profitable customer
relationships.
• Marketing is satisfying customer needs
• Marketing is social and managerial
process by which individuals and
organizations obtain what they need and
want through creating and exchanging
value with others.
Some support program provided by the franchisor to the franchisee
includes:

1 Market Research

Marketing surveys 2

3 Site Selection

Operational layout 4

5 Store design
Strategic Planning in Franchising

Business Market
Image Direction

Core
Marketing
Issues
Ongoing
Recruitment
advertising
of
and grand
franchisees
openings
Business image
Branding and Brands
– Task of image and brand management.
– Values generated in the minds of people as a
consequence of the sum total of marketing
communications effort.
– Set of attributes, that have a meaning, an image
and produce associations with the product when a
person is considering that brand or product
Brand logo
Determining the market direction
It answers the questions:

• Where will the first expansions take place?

• How will they be served by headquarters?
• What locations or territories will be entered next?
• To what extent does the franchise system intend to become a multi-
state, regional, national or international system?
Recruitment of franchisees
Ongoing advertising and grand
openings
Strategic planning pertains to the process of
developing and maintaining a "strategic fit"
or the most appropriate strategy between
the organization's goals and capabilities in
the changing marketing opportunities.
The changing marketplace
Problems in Applying Strategic
Planning to Smaller Business
Steps in Strategic Planning
• Franchise Organization Mission
Mission is a statement of the
business’ purpose in the
industry category or what the
organization wants to
accomplish in the larger
business environment. It can
also mean the purpose of why
an organization is existing.
Hierarchy of Objectives and Strategies
Determining Niche(s) Suitable to
Company Strengths
Marketing Mix

• The set of tactical marketing tools –

product, price, place and promotion that
the firm blends to produce the response
in the target market.
The 4Ps of Marketing
🞂Product. This refers to the actual
good or service, and how it relates to
the end-user’s needs and wants.
Characteristics of Services as a product
🞂Pricing. This refers to the process of setting a
price for a product, including discounts. The
price need not be monetary. It can simply be
what is exchange for the product or service, e.g.
time or attention.
🞂Promotion. This refers to the
communication between the seller
and the consumer.
Placement or Distribution.
🞂This refers to the
process of how the
product gets to the
customer; for
example, point of
sale placement or
retailing.
  THE ADDITIONAL 3Ps
🞂People. These are the employees,
customers or those who are directly
involved in consuming or producing the
goods or services.
🞂Physical Evidence.This can
be the facility design, equipment
or signage.
🞂Process. This is
the flow of activities or
steps and level of
customers’
involvement.
 
Characteristics of Services as a product
Product Life cycle in Franchise Marketing Strategy
Introduction and early growth
Product Life cycle in Franchise Marketing Strategy

Sales continue to
grow but are
increasing at a
decreasing rate
Product Life cycle in Franchise Marketing Strategy

Retention and evaluation stage

NEW PRODUCT
DEVELOPMENT
New Product
Human Pillow
Anatomy jeans
Spray-on Bandage Remover
A device that trains you to smile
Turn your sink into drinking fountain
Urine sample candy
Assess the Marketing Program’s
Effectiveness
 DHVTSU

CO-BRANDING
Chapter 4
Co-branding (also called dual
branding) – occurs when 2 more
well known brands are combined
in a business offering.
Betty Crocker - Hershey
Betty Crocker, the brand introduced in
1921 and owned by General Mills (GIS), is
the queen of partnerships. The company
has combined the likes of Hershey (HSY)
and Sunkist to create easy-to-make food
products.
Dairy Queen - The Girl Scouts
Dairy Queen celebrated Girl Scout
appreciation week with Girl Scout
Tagalongs featuring Peanut Butter Patties
and Thin Mints. The Thin Mint Blizzard is
the most popular limited edition to date,
selling more than 10 million in one month.
Michael Jordan - Nike
Nike (NKE) created the first pair of Air
Jordans in 1984. It has since produced 23
versions, with a price tag of more than
$100.
Brand
According to AMA it is a name,
term, sign symbol or design, or
a combination of them,
intended to identify the goods
and services of seller or group
of sellers and to differentiate
them from those of
competitors.
RESORT
WORLD
 DON HONORIO
VENTURA
TECHNOLOGICAL
STATE
UNIVERSITY
JOLIBEE
OLAY
PHILAM
LIFE
TOYOTA
EVEREADY BATTERY
SONY
VAIO
DEL
MONTE
GINEBRA SAN MIGUEL
TRIBAL
FILA
SAN MIGUEL
BEER
KFC
APPLE iPHONE
ABS-
CBN
WALT DISNEY
PICTURES
PEPSI
DOVE
SHELL
CROCS
GREENWICH
PETRON
GLOBE
METROBANK
SELECTA
PRINGLES
STARBUCKS COFFEE
PLDT
COLUMBIA PICTURES
DUNKIN
DONUT
BOYSEN
PUMA
MICROSOFT
HONDA
PAL
GIRL SCOUT OF THE PHILIPPINES
DEVELOPMENT
BANK OF THE
PHILIPPINES
How, Where and When was
Branding originated?
Important reasons for a franchisor to
develop a brand image
• Market Identity – Consumers are interested
in knowing that the brand represents a
certain offering in terms of quality, service,
value, price level, prestige and even
cleanliness.
Important reasons for a franchisor to
develop a brand image
• Customer Loyalty – Individuals have a
tendency to identify brands with the product
that they enjoy and prefer.
Important reasons for a franchisor to
develop a brand image
• Brand Identity - An
advantage that may large
franchisors have is that
they have been able to
develop a brand identity
among franchisees as well
as customers.
Important reasons for a franchisor to
develop a brand image
• Customer demand – Customers still have a
tendency to repeat their purchase
decisions.
Important reasons for a franchisor to
develop a brand image
• Values – A brand can stand for the value
that is being received.
Advantages of Co-branding
• Customer convenience
• Brand strengths
• Common Area
• Easier Set up
• Reduced Costs
• Reduced Administration
• Common Advertising
Advantages of Co-branding
1. Customer convenience
Advantages
2. Brand strengths
Advantages of Co-branding
3. Common Area
Advantages of Co-branding
4. Easier Set up
Advantages of Co-branding
5. Reduced Costs
Advantages of Co-branding
6. Reduced Administration
Advantages of Co-branding
7. Common Advertising
Disadvantages of Co-branding
• Brand strengths
• Location
• Management Devotion
• Different Franchisors
• Costs
• Royalties
Disadvantages of Co-branding
1. Brand strengths
Disadvantages of Co-branding
2. Location
Disadvantages of Co-branding
3. Management Devotion
Disadvantages of Co-branding
4. Different Franchisor
Disadvantages of Co-branding
5. Costs
Disadvantages of Co-branding
6. Royalties
 DHVTSU

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