One look at today’s franchise candidates will reveal that they are more sophisticated, better educated, and more technologically advanced than ever before. In addition, and even more so due to the economic crisis, they are extremely cautious.
Today’s candidates spend more time researching opportunities, and they do so at a much slower pace. To be diligent in the process, more time is spent online going through page after page of information, constantly bookmarking, and going back and forth from new information to saved information. They are comparing notes with other franchise candidates on social networking sites. In addition, they are gaining invaluable information by monitoring online forums and discussion groups.
Ultimately, today’s franchise candidates want, need to make sure that the franchise opportunity is as perfect for their situation as humanly possible. In the past, and especially after previous recessions, franchise candidates would take their capital gains and invest in a franchise opportunity. Many times leaving the main investment intact. There was a feeling of throwing caution to the wind because they were investing profits. Many times unholy gains, at least by today’s standards. Does anyone remember when the money markets returned 17% profit margins?
Unfortunately, many people looking for franchise opportunities today see things differently. They have to. Many are corporate executives in transition staring back at illustrious careers attempting just ten more years before retirement. Challenged by young talent, new technology, and a rapidly changing business environment, many are choosing to “buy” a job and explore franchising and small business ownership.
What changed?
This is the difference between the current recession and that of the past. With huge fortunes lost and no big gains made in today’s financial markets, today’s candidates are forced to invest all or part of their remaining savings to enter the world of business ownership. Of course, everyone knows and fully understands the risks involved in owning a business. But in yesterday’s business environment, many franchisees and business owners were “playing games” with profits.
Certainly no one wanted to lose money in a business venture. But, many had support positions with funds still in retirement accounts and, of course, if they had to, employment. For many of today’s candidates, failure is not an option because endorsement opportunities are fast becoming non-existent. In fact, I think many of today’s candidates might not have even considered franchise or small business ownership in the past.
Therefore, as many people explore their options, they will increasingly focus their efforts online. Franchisors need to accept this fact and dedicate more resources to the internet and look to social media to complement, not replace, their traditional franchise marketing strategies. By doing so, they will reap multiple benefits for their entire system, including:
– Create or further develop brand awareness with franchisee candidates and consumers alike.
– Generate franchise leads who are genuinely interested in exploring what franchising and small business ownership have to offer, and how a particular concept can be the vehicle to achieve their goals and objectives.
– Establish an interactive communication and information exchange environment that will become the backbone of future franchise relationships through franchise systems.
Lastly, it used to be that many franchise candidates saw franchising and small business ownership as a way to achieve their wishes, hopes and dreams, whatever they may have been. Today, it is more about goals, objectives and needs. We as an industry need to fully realize this and understand the mindset of today’s franchise candidate.