It is a standard thing in a Franchise group to have a National Marketing Fund. This is the fund that all franchisees contribute to – usually as a percentage of their gross turnover – above their franchise royalty amount.
The money collected for this fund is then used on National Marketing Campaigns, the website, social media and to pay the administration of the marketing (eg. a Marketing manager or outsourced companies and collateral including as an example graphic design).
So why doesn’t Gutter-Vac have a National Marketing Fund?
Basically, I think they are a waste of money. Yes, I said it! A large percentage of the money collected goes to administering the fund and they are always a bone of contention because all the franchisees have a different opinion on how the money should be spent – what marketing should be done. You really can’t please everyone.
The negatives – to me – outweighs any benefit.
The biggest reason is that we understand our business and we understand how our customers think.
Local Area Marketing is where it is at. Our customers like to work with LOCAL business owners… but have the backing of a national brand.
Doing a national TV campaign, will not get more people to book in to get a quote to get their gutters cleaned, but a local business owner, at the local Sunday morning market, where people can go and talk to them… now that will bring business.
We would rather see our franchisees take that 5% of their gross revenue (the standard national marketing fund contribution in franchising) and put that into doing things in their local area.
The other thing you need to consider in Gutter-Vac is that we have REPEAT business. That is, someone has their gutters cleaned this year, they will then get them cleaned next year and the year after that. In fact, we have a programmed maintenance plan where you can remind your customers each year that it is time for their gutter clean. This basically costs next to nothing.
Now imagine you have been in Gutter-Vac, running a good solid business where you have built up an excellent local reputation and have a customer base that is getting their gutters cleaned year after year. How much marketing would you need to do in that situation? Not much right… just a few basics, but most of your new business would be coming from referrals and from your signage on your trailer, van or truck as you drive from job to job. We know this.
Now consider, if we had a national marketing fund that you had to contribute 5% of your gross revenue to, would that actually be of any use to you? Wouldn’t you think that 5% would be better in your pocket?
We know there are franchise groups out there saying they will guarantee your work, get you leads, but just stop for a second and think about it… you are paying for that… did you realise that.
We may not have a national marketing fund, but you also don’t pay for the website or the design of new marketing materials or even our social media efforts. We have full training on LOCAL AREA marketing in our initial franchise training and we have experienced business coaches with a wealth of marketing knowledge and experience to help you throughout your entire time at Gutter-Vac. I cover all of that because I believe that is something I should be giving you as part of your royalty payment, not at an additional fee.
I may be old fashioned, but I still believe in Australia that people like to do business with local business owners, they like to know the owner, they like the reputation of a company to be high. I still believe that you will reap what you sew and if you do good work, look after your customers, you can build a really strong repeat customer base and get lots of referrals. None of this requires a national marketing fund, so I’d rather you invest that money into your local area where it will get a result for YOU !
So that’s why we don’t have a national marketing fund and that’s why I’m PROUD we don’t have a national marketing fund!
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