The face of franchising is quickly changing.
Recent census data shows that minority-owned businesses are on the rise. Nationwide, Hispanic-, Asian-, and African-American-owned businesses grew by more than 2 million from 2007 to 2012, and now comprise just under fifteen percent of total small businesses in the U.S. In the five-year span between 2007 and 2012, minority-owned businesses soared 46 percent, while non-minority businesses grew only ten percent.
And business isn’t the only thing that’s changing. Hispanics, Asians, African-Americans, and other minorities are becoming a force to be reckoned with as consumers. According to a new report from Nielsen.com, African American consumers represent $1 trillion in buying power that is predicted to reach $1.3 by 2017. In view of these findings, reports and editorials are suggesting that companies need to “build and sustain deeper, more meaningful connections” with black and other minority consumers.
So what does this mean for franchisers? How can franchisers (or potential franchisers) meet the needs of the changing face of their customer base, as well as the changing face of their franchise owners?
For Misty Young, co-founder and chairman of the board of Squeeze In Franchising, LLC., a broad appeal is key.
“Whatever your business model is, you have to appeal to a wide variety of clients or guests,” says Young. “And if you want to appeal to a lot of people, you need to make your marketing and your advertising appeal to a broad base of people.”
One way franchisors can do that? Representation, says Young.
“If I were doing something specific to a Latino market, I might use a specific flag, or flag colors. If I were looking to appeal to a specific group, my imagery and language would have to be targeted accordingly. It’s affinity marketing.”
Says Young, “From a franchisor perspective, we represent who we are, and what our brand is about. But the sales message has to be about the intended recipient. In the videos on our web site, we star in the videos and talk about our company. But for pictures in restaurants, you see our guests. If you want to bring in specific consumers, you use images that appeal to them, create advertising that they feel for. It’s always about [the consumer].”
So how can franchisors figure out what appeals to whom? Targeted research.
“If I want to target an Asian market, I’m going to do everything I can to be likable to an Asian franchisee. I’ll do research further to see what speaks to an Asian franchisee and what matters in an Asian community. You find out what matters to them, and that’s your message. That’s how you get people’s attention.”