Marketing Math Executing Local Store Marketing Facilitator: David Buckley, CMO, Sears Hometown & Outlet Stores @DavidJBuckley Panelists: Jason Mann, Owner/Area Representative, Planet Smoothie & Tasti d'Lite Randy DuBoise, Owner, Meineke; Christina Coy, Director of Marketing, Pie Five Pizza @piefivepizza Most Franchisees have local marketing plans • 72.5% of respondent’s Franchisees HAVE a Marketing Plan • 17.4% Do Not Have a Marketing Plan • 10.1% of respondents don’t know if their Franchisees have a marketing plan. zcubator.com | info@zcubator.com | 1.800.280.8305 3 50.7% Set Specific Goals For Each Local Promotional Campaign SOMETIMES • 21.7% ALWAYS set specific goals • 18.8% NEVER set specific goals • 8.7% DON’T KNOW if specific goals are set for each local promotional campaign zcubator.com | info@zcubator.com | 1.800.280.8305 4 Results are across the board when it comes to satisfaction with their 2013 Local Marketing Strategy, though 32.4% are Somewhat Satisfied, followed by 31.1% Satisfied. zcubator.com | info@zcubator.com | 1.800.280.8305 5 Do you measure the return on investment (ROI) that is achieved from the dollars you spend on your local marketing campaigns in these areas? Campaign Type Always Sometimes Never We don’t use this channel I don’t know Pay Per Click 46.9% 21.9% 9.4% 18.8% 3.1% Email Campaigns 44.4% 33.3% 14.3% 4.8% 3.2% Direct Mail 40.0% 32.3% 7.7% 15.4% 4.6% Flyers 26.2% 30.8% 8.5% 20.0% 4.6% Coupons 25.0% 28.1% 9.4% 32.8% 4.7% zcubator.com | info@zcubator.com | 1.800.280.8305 7 What are your top THREE greatest local franchise marketing challenges? Local Franchisee Marketing Challenges 1 2 3 Lack of budget 59.4% 21.9% 18.8% Lead generation 43.8% 37.5% 18.8% Franchisee compliance 26.1% 26.1% 47.8% Disparate systems to handle all media channels that don’t ‘talk’ to each other / don’t work together well 18.2% 18.2% 63.6% Hard to keep up with all of the new media channels 20.0% 50.0% 30.0% Hiring marketing talent at the corporate level 23.1% 30.8% 46.2% Marketing to my franchisee customer database 18.2% 72.7% 9.1% Oversight over what franchisee is doing for marketing efforts 23.1% 42.3% 34.6% Other 40.0% 20.0% 40.0% Don’t know / N/A 12.5% 12.5% 75.0% zcubator.com | info@zcubator.com | 1.800.280.8305 Corporate Responsibility NMF Franchisee’s Responsibility Brand Awareness Strategy System Promotions Annual Calendar PR Local Consumer National Consumer Co-Op Market-wide LSM Local Advertising Market-wide Sponsorships Event Marketing Grand Opening Trade LSM Grassroots Mktg Community Oriented Field Mktg Support LSM Programs/Tools Contributions to Local Advertising Media 2% National Marketing 1% Local Store Marketing 1% Regional Advertising Co-Op National Marketing Fund Co-op Budget Allocation 70% Traditional Advertising — DMA wide Coupon Drops in the Orlando Sentinel — Supports NMF Promotions on a direct Local Level — Reach 380K 4 x’s a year 25% Events Support — Participation in events of 1000 people or more — 15 + events or more with an average of 2500 participants LSM Budget Allocation 90% Support Collateral and Tools — Coupons — Support tools i.e. Tent, table clothe, flags, banners 10% Loyalty Program Schools Business Gyms Location Churches Apartments Coupon or Discount Marketing Purpose - to drive trial and frequency Advantages: — Easy to track — Instant gratification — Tangible results — Drives traffic Disadvantages: — Cutting price to gain customers — Customers loyal to discounts may not be loyal your business Measuring tools - Sales Comps, Customer Count, Ticket Average — General Cost: $10 to $25 per 1000 people hit — Return: 1- 5% of total drop depending on aggressiveness of discount and type of coupon guide Event Based Marketing Purpose - Build brand awareness, drive traffic and create loyal customers Advantages: — — — — Direct touch of potential customers direct dialogue Product sampling opportunity potential catering opportunity Disadvantages: — Labor intensive — returns may not be instant — hard to track impact Measuring tools: immediate coupon redemption from the event, customer count increase over time — General Cost: Tools $1000 with tent, table clothe, flags (add $2500 for wrapped vehicle); $75 to $400 an event including product and labor (entry fees extra) — Return: Based active event marketers 8 to 15% per year growth Loyalty Program – Plum Rewards Purpose – Reward the frequent and VIP customers with direct communication of offers and messages Advantages: — — — — — Text based technologically relevant Rewards customers building loyalty instant ability to drive traffic 100% electronically tracking Highly targeted campaign 0-30,60,90,120 etc… Disadvantage: — Discount and coupon based marketing — drag down ticket average and food cost Measuring Tools: Cloud based real time activity and measurement based tools — Cost: $25 – $250 + per month depending on number of offers sent out — Return: Direct customer impact 40 to 60 customer per campaign Loyalty by the #’s New Cust Merchant Custs Visits Coupons GCs Cust Activities Total Visits Total Receiving Custs Coupons Loyalty RC % Only LO % Points Planet Smoothie Crane's Roost 3 38 2 0 3 156328 25929 4192 16.17 % 21737 83.83 % 38 Planet Smoothie Sports Authority Ctr 4 57 6 0 6 118509 17611 2762 15.68 % 14849 84.32 % 54 Planet Smoothie Waterford Lakes 6 40 6 0 8 151528 24390 4063 16.66 % 20327 83.34 % 39 13 135 14 0 17 426365 67930 11017 16.22 % 56913 83.78 % Total Loyalty by the #’s Campaign Type Coupon Text Regular Campaign We MISS U, come see what's new at ur Planet SINGLE USE Smoothie, 50% OFF ur purchase! Exp 1/26 2835 70 2.47% 1/22/2014 12:00:00 AM 1/26/2014 10:00:00 PM 1/22/2014 9:25:13 AM Regular Campaign Chilly or not we are HOT, try our CHERRY SINGLE USE TART! 20% off any smoothie. Exp 11/14 1353 38 2.81% 11/13/2013 12:00:00 AM 11/14/2013 11:30:00 PM 11/13/2013 11:35:16 AM Regular Campaign Go GREEK! $2 off ANY Greek Yogurt Smoothie exp 9/27 SINGLE USE 2081 51 2.45% 9/19/2013 12:00:00 AM 9/27/2013 11:30:00 PM 9/19/2013 9:36:45 AM Regular Campaign REFRESH ur SUMMER with our 3 Blazing SINGLE USE Summer Smoothies! 20% OFF exp 7/25 2077 69 3.32% 7/23/2013 12:00:00 AM 7/25/2013 11:00:00 PM 7/23/2013 11:56:42 AM Type Sent Redeemed Ratio Begin Date End Date Sent Date myPR 2014 Transition: Discount Marketing to Brand Loyalty Hired an Advertising Agency Initiatives: — Consolidate Facebook pages in the region and have all social media managed — Manage all map based and review based searches i.e. Yelp, Google, etc — Move away from traditional couponing and move towards Digital Marketing — Manage all other types of Marketing efforts — Event budget will increase — Social Media will become an integral piece of our social media efforts Individual pizzas ordered “sandwich style” One size, one price, unlimited toppings in under 5 minutes Four crusts to choose from, including gluten free and whole grain 7 sauces & over 25 toppings to create your perfect personal pizza 20 locations & commitments for 160 more! National vs. Local Marketing Spend National Marketing Spend • • • • • Brand Strategy Public Relations (Natl. & Local) Consumer Research Customer Loyalty National Promotions/LTOs Local Marketing Spend • • • Local Store Marketing Community Involvement Event Marketing A little work = a lot of new customers Objective: Look for ways to attract new customers within 3-5 mile radius of restaurant. Tactic: Contacted largest apartment complex near the restaurant to find a marketing opportunity. Placed ad in resident magazine. Offer: Residents were given a FREE pizza (regular price $6.79) when they brought in the ad. Cost: $1,443 (includes cost of ad in publication & food cost) Revenue: $1,920 Result: — ROI 33% — Redeemed 7.3% Pie-Advocates are a Portion of the Pie Objective: Look for ways to increase brand awareness & sales at two locations near college campuses. Tactic: Hired two students to be brand advocates (aka “Pie-Advocates”) for 14 weeks with specific goals per week. Offers: $5 pizza and BOGO. Cost: $3,900 (includes food cost, cost for promotional materials & hourly wage) Revenue: $5,458 Results: — ROI of 153.6% — Brand awareness at school functions and “walking billboards” — New opportunities discovered for future marketing efforts Loyalty is the New Discount Objective: Reduce discounts & increase frequency Tactic: Implement loyalty program to incentivize customers to visit more often. Offers: Points based (2 points per pizza purchase. 20 points = free pizza) — Implement double points days to increase frequency & traffic Results: — Double points increased traffic an average of 15% — Double points increased sales an average of 9% — Discount percent went down by 2 points — Testing new offers such as triple points & points for add-ons, which have also proven to increase traffic & sales