Franchising And The Internet

Entrepreneur.com:

For the last several years, record numbers of new franchisors have entered the marketplace—more than half the franchisors in the marketplace today are less than 10 years old.

Why this explosion?
In part, businesspeople are becoming more aware of the power and the benefits of franchising. But beyond these factors, another not-so-obvious factor has instigated this explosion: the internet.

The Great Leveler
Perhaps more than any single factor, the internet has helped level the playing field for the new franchisor. Never before has someone been able to get the message of a new franchise to a broad market this fast.

2 decades ago, if you wanted to compete with ‘the big boys,’ you would need to advertise to get franchise sales leads. Back in the Magazine and 2-column-by-3-inch ads in the Wall Street Journal. That kind of advertising commitment was simply not economically feasible for most startup franchisors.

Today, while the new franchisor has the same operational and legal costs to get into the marketplace, a college kid with a lemonade stand and a credit card can create a first-rate franchise website over a weekend, run pay-per-click ads on the front page of Google and be talking to prospects by Monday. And while he may not be able to afford the top position for long, his website could be just as impressive as the website used by McDonald’s. Likewise, production and mailing costs for marketing materials and UFOCs have been significantly reduced (and, for some franchisors, eliminated) as streaming videos and PDFs replace their traditional hard-copy ancestors. Especially in markets where there is not yet a well-established brand, new franchisors can dominate a new niche very quickly. Continue reading.