If you're the Director of Franchise Development, you're under tremendous pressure to award more franchises, despite ever tightening resources. Doing that development math can make your job more stressful than it needs to be, and we want to share a formula to help do so using texting for sales and marketing. Think of it as going to back to the franchising future.
We believe there is way to flip that math and sell more franchises at lower cost. It involves text messaging and, yes, a bit of math. But don't worry, the math is easy. First you have to take stock of your present in order to go back to the franchising future.
Imagine your brand not utilizing 2-way text messaging for franchise development today. If it costs your franchise about $30 to generate a valid lead, and your sales can eventually get ahold of a generous 1 out of 10 leads (10% contact rate), and of the leads they’re able to contact, your sales team eventually awards a franchise to about 1 out of 35 (2.9% contact to close rate).
This implies 350 leads for every franchise that your brand awards. Bringing these figures together:
$30 cost per lead x 350 leads per closed deal = $10,500 cost to award a franchise.
That's franchise development without the aid of texting. Next, let's see how dramatically the numbers can move in your favor after you add effective texting to your process
You activate FranFunnel’s intelligent, 2-way texting software and watch your team’s lead contact rates jump overnight (we mean that literally) from, say, 10% to 25%.
Now, rather than reaching on 1 of 10 leads (10% contact rate), your team is getting ahold of 1 out of 4 (25%).
So, instead of contacting 1/10 of leads and closing 1/35 (2.9%) of those they get ahold of, your team is successfully contacting 1/4 (the texting works!) and closing 1/45 (2.2%) because they’re so swamped with conversations.
Reaching 1/4 leads and closing 1/45 means it’ll take around 180 leads, on average, to award a franchise.
$30 cost per lead x 180 leads per closed deal = $5,400 cost to award a franchise (vs. $10,500 before your team was using texting).
Suddenly you'll be speaking with way more leads. And your close rate on successfully contacted leads drops a bit, but your sales team's energy can be redirected to all those leads now responding eagerly over text.
What would awarding two or three times the franchises do for your brand? We believe hundreds of thousands to millions of dollars of franchise fee revenue and market value added to the brand. Every year.
Look, you’re already paying for leads, either through portals, performance marketing, SEO and content. Now you have a chance to flip the math entirely by getting the absolute maximum from your leads with texting automation.
Ultimately, franchisors and franchisees must make their sales processes as effective and efficient as possible in order to get the best return on their marketing dollars. By adding tools like FranFunnel (the #1 text messaging platform in the industry) you can connect with a much higher percentage of you leads and close more deals.