Consumer Franchise Building versus Nonfranchise Building Promotions

Sales promotion activities that communicate distinctive brand attributes and contribute to the development and reinforcement of brand identity are consumer franchise building (CFB) promotions. Consumer sales promotion efforts cannot make consumers loyal to a brand that is of little value or does not provide them with a specific benefit. But they can make consumers aware of a brand and, by communicating its specific features and benefits, contribute to the development of a favorable brand image. Consumer franchise-building promotions are designed to build long-term brand prefer ence and help the company achieve the ultimate goal of full-price purchases that do not depend on a promotional offer.

This promotion agency ad stresses the importance of using trade promotions to build brand equity

Marketing Versus Non Marketing

For years, franchise or image building was viewed as the exclusive realm of advertising, and sales promotion was used only to generate short-term sales increases. But now marketers are recognizing the image-building potential of sales promotion and paying attention to its CFB value. Surveys have found that nearly 90 percent of senior marketing executives believe consumer promotions can help build brand equity while nearly 60 percent think trade promotions can contribute. Marketers recognize that the value of sales promotion extends well beyond quick-fix tactics such as price-off deals. Most sales promotion agencies recognize the importance of developing consumer and trade promotions that can help build brand equity. For example, the ad for Ryan Partnership that stresses how the agency develops trade promotions that help build brand equity.

Companies can use sales promotion techniques in a number of ways to contribute to franchise building. Rather than using a one-time offer, many companies are developing frequency programs that encourage repeat purchases and long-term patronage. Many credit cards have loyalty programs where consumers earn bonus points every time they use their card to charge a purchase. These points can then be redeemed for various items. Most airlines and many hotel chains offer frequent-flyer or guest programs to encourage repeat patronage. Many retail stores have also begun using frequency programs to build loyalty and encourage repeat purchases.

Companies can also use sales promotion to contribute to franchise building by developing an offer consistent with the image of the brand. An example of a successful consumer brand-building promotion is the Search for 2000 Uses Sweepstakes promotion for WD-40, shown in Exhibit 16-8. The WD-40 Company positions its brand as the leading multipurpose problem solver that cleans, protects, penetrates, lubricates, and displaces moisture like no other product on earth. The marketing strategy for WD-40 is to continually promote the myriad of uses for the product. The Search for 2000 Uses Sweepstakes, which was launched to coincide with the new millennium, asked consumers to suggest their use for WD-40 in order to be entered for a chance to win various prizes such as WD-40 can radios, T-shirts, and baseball caps and a grand prize of $10,000 in company stock. The sweepstakes reinforced WD-40's image as a multipurpose problem solver and also encouraged consumers to visit the company's website to enter their uses.

Search for 2000 Uses Sweepstakes is an excellent example of a consumer brand-building promotion

Trade Advertising Examples

Nonfranchise-building (non-FB) promotions are designed to accelerate the purchase decision process and generate an immediate increase in sales. These activities do not communicate information about a brand's unique features or the benefits of using it, so they do not contribute to the building of brand identity and image. Price-off deals, bonus packs, and rebates or refunds are examples of non-FB sales promotion techniques. Trade promotions receive the most criticism for being nonfranchise building— for good reason. First, many of the promotional discounts and allowances given to the trade are never passed on to consumers. Most trade promotions that are forwarded through the channels reach consumers in the form of lower prices or special deals and lead them to buy on the basis of price rather than brand equity.

Many specialists in the promotional area stress the need for marketers to use sales promotion tools to build a franchise and create long-term continuity in their promotional programs. Whereas non-FB promotions merely borrow customers from other brands, well-planned CFB activities can convert consumers to loyal customers. Short-term non-FB promotions have their place in a firm's promotional mix, particularly when competitive developments call for them. But their limitations must be recognized when a long-term marketing strategy for a brand is developed.

Consumer-Oriented Sales Promotion

We study the consumer-oriented promotions and discuss their advantages and limitations. First, we consider some objectives marketers have for sales promotion programs targeted to the consumer market.

Continue reading here: Objectives of Consumer Oriented Sales Promotion

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Readers' Questions

  • diana
    What are differences between a consumer franchisebuilding promotion and a nonfranchise buildin?
    2 months ago
  • g promotion?
    1. Relationship with the brand: A consumer franchise-building promotion is aimed at building a strong and loyal consumer franchise for a specific brand or product. It focuses on long-term relationships with customers, ensuring repeat purchases and brand loyalty. On the other hand, a non-franchise building promotion may not have a specific brand or product in mind. It could be a one-time promotion aimed at generating sales or creating buzz without necessarily building a loyal consumer following.
    2. Duration and frequency: Consumer franchise-building promotions are often long-term strategies that aim to build a lasting relationship with consumers. These promotions may be ongoing or conducted periodically to reinforce the brand message and maintain consumer interest over an extended period. Non-franchise building promotions are typically shorter-term initiatives that are focused on achieving specific objectives within a limited time frame. They may be one-off sales events, limited-time offers, or short-term promotional campaigns.
    3. Depth of engagement: Consumer franchise-building promotions are generally designed to create deep engagement with consumers by offering value, personalized experiences, or ongoing benefits. They often involve loyalty programs, rewards, or exclusive offers for loyal customers. Non-franchise building promotions may not have the same level of depth in terms of consumer engagement. They may focus more on attracting attention, generating immediate sales, or creating awareness rather than fostering long-term relationships.
    4. Customer retention vs. customer acquisition: Consumer franchise-building promotions primarily aim to retain existing customers, encourage repeat purchases, and build brand loyalty. These promotions focus on deepening the relationship with current customers. Non-franchise building promotions, on the other hand, may have a higher emphasis on customer acquisition. They are designed to attract new customers, increase market share, or expand the customer base rather than focusing solely on existing customers.
    5. Strategy and objectives: Consumer franchise-building promotions are part of a broader brand strategy and aim to establish a distinctive brand image, increase brand equity, and create a strong customer franchise. They often align with the brand's long-term objectives and values. Non-franchise building promotions may have more short-term sales-oriented objectives. They are designed to drive immediate sales, clear inventory, launch new products, or achieve specific short-term goals.
    6. It's important to note that these differences are not absolute and can vary depending on specific marketing strategies, industries, and market conditions. The distinction between consumer franchise-building promotions and non-franchise building promotions might not always be clear-cut, and some promotions may combine elements of both approaches.
    • mewael fikru
      What is nonfranchise building promotions?
      2 months ago
    • Nonfranchise building promotions refer to the marketing and advertising strategies used by stand-alone businesses or independent buildings to promote their products or services. Unlike franchise businesses, which operate under a recognized brand name, nonfranchise building promotions focus on creating brand awareness, driving customer foot traffic, and increasing sales without the support of a larger franchisor. These promotions can include various tactics such as:
      1. Local advertising: Nonfranchise businesses often engage in targeted advertising campaigns in local newspapers, magazines, radio stations, or billboards to reach potential customers in their immediate vicinity.
      2. Social media marketing: Utilizing social media platforms like Facebook, Instagram, Twitter, and LinkedIn to promote their products or services, engage with customers, and build a loyal following.
      3. Events and contests: Organizing special events or contests to attract customers to the building, generate buzz, and encourage word-of-mouth marketing.
      4. Partnerships and collaborations: Establishing partnerships with complementary businesses or organizations to expand their reach and cross-promote each other's offerings.
      5. Loyalty programs: Implementing customer loyalty programs that reward frequent visitors or provide incentives for repeat purchases to encourage customer retention.
      6. Local community involvement: Participating in local initiatives or sponsoring community events to build a positive brand image and support the local community.
      7. Email marketing: Collecting customer email addresses and sending regular newsletters or promotional offers to drive traffic back to the building.
      8. Referral programs: Encouraging satisfied customers to refer their friends, family, or colleagues to the business by offering incentives or discounts for successful referrals.
      9. Strategic signage: Utilizing eye-catching signage, banners, or flags to attract attention and communicate promotions or special offers effectively.
      10. Public relations: Engaging with local media outlets to share newsworthy stories about the business, such as charity involvement, innovative products, or industry accolades.
      11. Nonfranchise building promotions focus on crafting unique marketing strategies tailored to the specific needs and goals of the independent business and its target audience. These initiatives are crucial in establishing brand presence, attracting customers, and driving sales growth in competitive markets.
      • Edmund
        What is customer franchise building promotions?
        10 months ago
      • Customer franchise building promotions are marketing campaigns designed to improve customer loyalty and retention. They involve tactics such as providing incentives and special offers, creating loyalty programs, increasing customer service, running contests and sweepstakes, and hosting events to engage customers. These campaigns strive to foster a strong connection between a company and its customers, by creating a sense of belonging and trust between the two. They are designed to encourage customers to return to the brand, and to build strong relationships with them over time.
        • Veikko Mett
          What is a consumer franchise building promotion?
          1 year ago
        • A consumer franchise building promotion is a marketing program designed to help a consumer franchise increase brand recognition and loyalty among its customers. It may involve giving away coupons, offering discounts, or launching a social media campaign.
          • Isaac
            What is the difference between franchise building promotion and nom franchise building promotion?
            1 year ago
          • Franchise building promotion is when a business owner seeks to build the brand of their business through marketing activities such as print, television and radio advertising, direct mail campaigns, and public relations. Nom franchise building promotion is when a business owner works to build brand recognition through digital and social media marketing, mobile marketing, and other digital channels.
            • armida
              What is francise building promotion?
              1 year ago
            • Franchise building promotion is an approach to marketing and advertising that is used to promote a franchise opportunity to potential franchisees. It typically includes a combination of communications tactics, such as digital, print, radio, and television advertising; direct mail; and other promotional activities like events and sponsorships intended to help increase awareness and interest in a franchise business.
              • lee
                What is the difference between a consumerfranchisebuilding and nonfranchisebuilding promotion?
                1 year ago
              • The difference between a consumer franchise building promotion and a non-franchise building promotion lies in their target audience and purpose.
                1. Consumer Franchise Building Promotion:
                2. - Target Audience: These promotions are aimed at existing customers or potential customers who are loyal to a particular brand or franchise. - Purpose: The main goal of consumer franchise building promotions is to strengthen customer loyalty, build brand awareness, and increase repeat purchases. They focus on long-term customer relationships and aim to create a strong consumer base for the franchise. Examples: Loyalty programs, special offers for existing customers, exclusive discounts for franchise members, personalized marketing campaigns tailored to the preferences of loyal customers.
                3. Non-Franchise Building Promotion:
                4. - Target Audience: These promotions target a wide range of potential customers, including both new customers and those who are not necessarily loyal to a specific brand or franchise. - Purpose: The primary objective of non-franchise building promotions is to attract new customers, increase sales, and generate immediate revenue. They aim to create awareness about a brand or a specific product/service among a broader audience. Examples: Limited time offers, discounts, free trials, introductory deals, contests or giveaways, and broad-scale advertising campaigns targeting a wide demographic. In summary, while consumer franchise building promotions focus on maintaining and expanding the customer base of a specific franchise, non-franchise building promotions are designed to attract new customers and generate immediate sales, without necessarily emphasizing brand loyalty.
                • Chica
                  What is non franchise building promotions?
                  1 year ago
                • Non-franchise building promotions are marketing and advertising campaigns that target members of the general public who are interested in constructing private or commercial buildings, such as residential homes or retail stores. These campaigns are typically used by independent contractors or builders who are trying to promote their services and gain new clients. These promotions may take the form of targeted online ads, direct mailers, radio and television commercials, print advertisements, and more.
                  • virgilia
                    Which of the following is an example of a nonfranchise building promotion?
                    1 year ago
                  • A business hosting a contest offering a free stay in their newly renovated hotel.
                    • Susanne
                      What is franchised sales promotion?
                      1 year ago
                    • Franchised sales promotion is a type of promotion strategy that gives a franchisee the right to use the brand name, logo, and other trademarks of a franchisor in order to promote and market the franchisee’s own products and services. The franchisee pays the franchisor for the privilege of using the brand or logo and often pays a percentage of sales that are generated by the promotion.
                      • lucas
                        How to consumer franchise building?
                        1 year ago
                        1. Research the franchising industry: Before you decide to become a franchisee, it's important to understand the industry. Research franchises that interest you and learn all you can about the franchisor and the business model. It's important to understand what types of franchises have been successful in the past, as well as what types of franchises have failed.
                        2. Choose a franchise: Once you have a good understanding of the industry, you can begin researching and evaluating different franchise opportunities. Consider franchises that are in line with your interests, experience and financial means. You'll also want to evaluate the franchise's track record and the franchisor's reputation.
                        3. Negotiate the franchise agreement: Once you have chosen a franchise, you'll need to negotiate the franchise agreement. This contract sets forth the agreement between you and the franchisor. The agreement will also cover items such as the franchise fee, royalties, territory restrictions and disclosure of information.
                        4. Create a business plan: Before you can begin building your franchise, you'll need to create a business plan. This plan should include the goals you want to achieve, the target market, your marketing strategy, and other essential details.
                        5. Secure funding: Once you have created a business plan, you'll need to secure funding for your franchise. This may include personal savings, a loan from a bank, or investments from an angel investor.
                        6. Train: Many franchisors offer comprehensive training and support for franchisees. This will help you learn everything you need to know about running the business.
                        7. Execute: Once you have completed the steps above, it's time to start building your franchise. Follow the franchisor's business model and use their resources to market your business.
                        8. Monitor progress: As your franchise grows, it's important to regularly monitor progress and adjust your strategy as needed. This will help ensure that you remain successful