Are you utilizing every scrap of data from your franchise system?  | Global Franchise
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Friday 27th January, 2023

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Are you utilizing every scrap of data from your franchise system? 


Are you utilizing every scrap of data from your franchise system? 

Data is the lifeblood of a successful business of the future, therefore brands must seek to find and use every piece of data it gathers to improve its services, products and outreach efforts

Data is a word that is often thrown around in almost all business landscapes in the world today. With so many businesses and brands either shifting to digital, or having a digital component, means that there are various touchpoints in a customer’s journey to purchasing a product or service. Each touchpoint is a source of data, and can tell a brand a lot about how its performing, where it needs to improve and what it is doing well. 

However, there are numerous sources of data. Brands can collect information from third-party sources, governments and sales data to the figures that come from individual franchise locations.  

It can also come from different channels, the data that stems from customers buying from an app, versus customers who purchase on the website can tell the brand interesting things about its consumers. Data can also be purchased; a brand could buy data for a certain demographic in a certain region so it can tighten its messaging for its target audience. 

“Over the last five years in our business, we’ve really seen, especially in the franchise space, this massive acceleration of the analysis of data. The pandemic heavily drove that too”

The data analytics market is always growing as more and more businesses embrace the use of data. Estimates suggest the data analytics industry to be worth around $105.8bn by 2027. That comes as no surprise as 65 per cent of global brands increasing their data analytics spend in 2020 according to Allied Market Research. 

A survey conducted by FinanceOnline shows around 50 per cent of businesses around the world use big data, and 63 per cent of those who do, cite the improved efficiency and productivity as its top benefit. 

Sources of data 

As digital infrastructure continues to grow, alongside the number of channels available, more sources of data will emerge too. In the early days of e-commerce, a brand may have only had two touchpoints before a customer was presented with the checkout page, whereas now, it can be around 13.  

“Over the last five years in our business, we’ve really seen, especially in the franchise space, this massive acceleration of the analysis of data. The pandemic heavily drove that too,” said Taylor Calise, CEO of Imaginuity, an integrated, full-service marketing agency. 

Internal data is one of the strongest and biggest sources for brands today, and internal data can mean anything from email marketing metrics to online activity on the checkout page. Internal data comes from customers’ direct interaction with the brand. The benefits of this type of data are that it’s already there, it has no use restrictions for usage within the organization and marketers can speak directly to whoever is responsible for collating the data. 

“Things like mobile numbers, email addresses, it’s mainly around things that allow you to personalize your marketing, and then communicate that. Looking through some of their spend habits, understanding how they spend and how many times they eat out,” said Michael Chachula, chief information officer for FAT Brands Inc

Third-party analytics is comprised of service providers who track traffic, and compare it to competitors. Long-term use of third-party analytics gives a brand an understanding of where it sits in its market over a period of time, and allows the brand to track its performance against itself in the past. Google Analytics is the best example of a third-party analytics service. Over time, it can track traffic and help franchisors understand how customers are finding their branded websites. 

External data can vary greatly, from simple, yet unreliable social media polls to buying large, bespoke datasets to support a campaign or increase knowledge. This type of data is useful in analyzing the wider world, and seeing how demographic, political, economic or social factors can affect the brand. 

Open data is cost-free and easily accessible, but that has its own downsides. The data is often heavily aggregated, meaning there may not be many in-depth insights to be found without a lot of work. Though, this is still a potentially useful source of data to help forecast for future trends. 

“I think one of the biggest things that is being ignored is the actual return-on-interest (ROI). Especially for brands that aren’t e-commerce driven, the ROI on a marketing campaign and tracking all that information all the way down to what’s driving revenue for the brand,” said Calise. 

Data that could be used more effectively 

In a 2019 article by CIO, it was pointed out that over $220bn has been generated by businesses that rely on data collected and made freely available by governmental organizations. Using open data isn’t a case of finding incredible sources of data that will increase revenue by 50 per cent, it’s about thinking outside of the box.  

The U.S. government’s platform links to around 211,000 data sets, as well as many applications that track live data, such as the Price Watch function on the food security section. However, such data is usually baked into purchased third-party data, meaning it is used, just not by brands themselves. 

“A lot of those open data sets end up being built into a lot of this third-party data you purchase,” said Calise. 

“Many of the data aggregators and data companies, they utilize these data sets inside of their underlying data sets.” 

With the varying channels that consumers like to use nowadays, brands have to get used to interacting with customers on each channel, on their own terms. It’s something many brands haven’t gotten quite right yet, but are thinking about and working on. 

“We don’t do enough work around watching how consumers consume our product, and what channels they come through. I find it very interesting that we still do email campaigns to customers that come to us through mobile,” said Chachula. 

“If you send them a personalized message, you have a higher chance of them coming in and actually consuming and as well as a lower cost of acquisition for the conversion. You’re using consumption habits as a strategy.” 

With third-party data subject to more privacy restrictions than ever before, franchisors must make use of every scrap of their own data. 

“As it relates to third-party data, it’s actually getting harder to gather. The level of granularity is less than what you might have had three or four years ago, and especially less than 10 years ago,” said Calise. 

“We’re having to come in and utilize all of the clients’ first-party data, so all their CRM and their customer information becomes more and more important.” 

Why brands cannot afford to ignore data 

McDonald’s is the world’s largest franchisor and apart from Antarctica, is present on every single continent. This is a brand that generates an untold amount of data on a daily basis, and has been generating even more since the launch of its app and loyalty program. 

Customer-focused strategies saw the brand first launch the app in 2015 – ahead of many of its competitors. The global fast-food giant has never left its app by the wayside, and it has had constant upgrades and marketing pushes. Over the pandemic-struck year of 2020, McDonald’s saw a 60 per cent increase in sales through digital channels. In the U.S., there are 21 million active members earning rewards on their McDonald’s app. 

This has led to the brand learning more about its customers and the channels they prefer to purchase from, and the lead-up to the purchase. The new insights have led to stronger marketing efforts. It’s no surprise that in 2021, the brand registered its highest-ever international sales at $112bn and 13.8 per cent sales growth in the U.S. 

“We don’t do enough work around watching how consumers consume our product, and what channels they come through. I find it very interesting that we still do email campaigns to customers that come to us through mobile”

“Customers have moved into an area of convenience, where they actually show up to a location that knows what they’ve ordered, so they get in and out extremely quickly,” said Chachula. 

“The second one is speed. They want to be able to get through a drive-thru or restaurant queue as fast as possible, and get on with their day. 

“And the third, really has to do with the pandemic; I think what it has done is remove quite a bit of resistance to gathering data. That allows us to avoid the high cost of acquisition in trying to gather that information, and break that wall down to have an intimate relationship with the customer for lifelong value.” 

Don’t ignore any data sources 

It’s easy to cast governmental data aside; everyone has access to it and therefore, it’s unlikely any one brand will find an insight that hasn’t been found already. Brands should develop an insular mindset to an extent, and make use of any sets of data that could be relevant to themselves. 

Flashes of genius and eureka moments are far and few in between. Continually improving and building on pre-existing knowledge with data-led insights provides a more sustainable driver of growth for franchise brands. 

“Data is becoming more important because the cost of marketing is going through the roof. Digital marketing, in some cases, we’ve seen almost double since the start of the pandemic on the cost for essentially the same click and the same consumer,” said Calise. 

“It’s becoming more expensive to advertise, not less.” 

It should not be news by now for any brand, but most are making use of data in some form or another. Not employing data analyses while competitors are, is a recipe for a slow death.

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