When you mix sales and marketing, the result can be a recipe for success
Illustration by Jonathan Hankin
When we do audits of a franchisor’s sales efforts, one of the most difficult issues to address in identifying the source of a problem is the inherent conflict between sales and marketing. When a salesperson fails to produce the expected results, they will invariably point a finger at marketing. And if the numbers are there in quantity, the marketing folks will push back. “We are providing plenty of leads. The problem lies in the sales process.”
In larger companies with multiple salespeople and large advertising budgets, it is easy enough to perform comparative analysis to get at the core of the issue. But for most companies, those with more limited resources and a single franchise salesperson, the issue becomes a much more difficult nut to crack. This is especially true given low anticipated close rates and an average close time that extends 12 weeks or more.
So how do you identify the root of a problem?
The right ingredients
Before starting any analysis of the sales and marketing process, the savvy franchisor will start at the beginning: with the concept itself. Is it possible that the finger pointing between sales and marketing is simply a distraction from a larger issue?
For franchisors that have historically sold franchises, the issue of salability would seem to have been answered. But while it may be difficult to swallow, just because you have sold in the past does not mean the concept remains salable. Failed or failing franchisees could be validating poorly. The emergence of new competitors may have usurped your position in the marketplace. Changes in the overall market may play a role. Bad PR may be lurking in social media or review sites that are not usually on your plate.
Start by looking inward. Grill your sales team on what objections are being raised. Conduct a comparative financial analysis of your offer versus those of your closest competitors. Do a side-by-side FDD review, as well as a comparison of marketing materials and websites. Mystery shop your franchisees to hear what prospects are hearing.
And, if you can, try to interview some of the “hot prospects” who ended up going a different direction.
How many portions?
Assuming it is not the concept, any remaining problems need to be attributed to either the sales or marketing effort. Before looking at qualitative issues, your first step should be to examine lead sufficiency. Determine if you are generating an adequate number of leads to reach your goals. If a 2 percent close rate is reasonable, you will need to generate 50 leads for every sale.
If you have insufficient leads, then your next order of business should be to determine if your ad spend was adequate or if you are advertising in the wrong places. Again, there are industry statistics that you can fall back on to determine if your problem is as simple as an underfunded advertising budget. Assuming the budget is adequate, focus on the marketing plan (issues such as media selection, media mix, messaging, target audience and timing) as the culprit in your spoiled recipe.
The more complex question arises when you have adequate lead flow with sales underperformance. And, unfortunately, without a substantial amount of data to fall back on, any conclusions you draw will be largely subjective. But that doesn’t mean there aren’t steps you should take.
Food for thought
From a marketing standpoint, statistical analysis against industry norms can provide some insight. But it can never fully account for variables such as messaging and target market. Moreover, given the length of time involved in the sales cycle, quick fixes tend to result in half-baked plans. Instead, opt for a more deliberate approach. Systematically replace the bottom 10 percent to 20 percent of your media based on costs-per lead every three months. And separately, conduct A-B testing on messaging and target markets using PPC ads for immediate feedback.
On the sales side, try to incrementally improve sales performance as quickly as possible. Remember, a franchise salesperson often starts their process by telling a prospect, “I would like you to quit your job, give up your benefits, and trust me with your life’s savings so that you can go into a business you know nothing about. And, by the way, I cannot tell you how much money you will earn.”
The franchise sale is unlike any other. So, if your team has never been trained in the nuances of franchise sales, small mistakes will adversely impact their performance. Just like marketing, your sales team needs to serve a consistent message, position the concept, and communicate your value proposition appropriately.
For those without experience, that often means turning to outside professionals. These professionals can conduct role-playing and mystery shopping exercises on your sales team and let you know if they have the basic ingredients for success. Moreover, these resources often provide your sales team with the kind of training that can lead to incremental improvement.
A franchisor looking to sell a dozen franchises per year will, at a 2 percent close rate, need to generate 600 leads in any given year. If training your team results in only a 10 percent improvement in sales efficiency, that training and coaching would result in 1.2 incremental franchise sales every year. And considering the long-term value of every franchisee, an investment in your people can often be more effective than spending incremental dollars on advertising for leads they cannot close.
In cases like this, sales and marketing can be like oil and water in a cake recipe. They don’t seem to go together, but without each, the dish will fail. And while marketing professionals sometimes are at odds with the sales team, the best will recognize that both concept and sales process must be a part of the marketing plan for everyone to succeed.
Mark Siebert is CEO of franchise consulting firm iFranchise Group. Reach him at 708.957.2300 or firstname.lastname@example.org. His new book is “Franchise Your Business: The Guide to Employing the Greatest Growth Strategy Ever.”