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How rapid digital innovation propels franchise growth

How rapid digital innovation propels franchise growth

With competition from digital players growing rapidly, established franchises must innovate to stay ahead.

Faster ordering, increased order size and higher customer satisfaction leading to repeat orders are business performance improvements franchisees love to see. However, realizing these and other advancements increasingly depends on the pace of innovation, particularly in the area of digital technology.

With competition from digital players growing rapidly, established franchises must innovate to stay ahead. A recent study by McKinsey & Company asserts that executives in companies that do this best innovate four times faster than other business.

They do this by shifting the direct responsibility for digital innovation from marketing to the CEO. To fill that role, leadership must, in turn, seek real-time digital learning, share insights quickly, deploy digital talent with agility, and reallocate resources flexibly.

They follow-up more frequently on digital initiatives (weekly) and share results with the organization quickly. This shifts the culture away from company politics and towards a greater focus on business impact generated from well understood, data-driven risks.

Helpful ideas to bolster digital innovation

This greater involvement of the CEO in digital innovation speeds up the flow of ideas, whether they are gathered from customers, front-line workers, vendors or others. The key is to assemble and evaluate them quickly. According to the study, the impact from numerous small digital initiatives is likely to be greater than a few large efforts that take a long time to implement.

To get you thinking, let’s consider a broad but non-exhaustive list of possible digital technology innovations. Items here can have a big impact, both at the franchisor and franchisee level.

Sales and marketing checklist

Digital Marketing: In addition to endless potential website improvements to enhance the customer journey, digital advertising techniques, such as geofencing, can stretch marketing dollars. Loyalty and ordering apps can be used to cut wait time and contribute to revenue growth.

Social media: For restaurant franchises, Instagram especially is a low-cost way to work with influencers and potentially reach millions, promoting the business with geotags, hashtags and ads.

CRM tools: Modern CRM systems make franchisor recruitment faster and more effective. Automating the process of getting leads from the website into the CRM and CRM automation like texting saves time.

Artificial intelligence: AI technology, including facial recognition of employees and customers can analyze customer shopping patterns and identify members of loyalty programs to offer them tailored promotions.

Home assistant ordering: When tied into your online ordering system, Alexa ordering increases convenience for the customer.

Payment technology: New payment methods like contactless cards and mobile payments speed up the payment process. And, where labor costs are high, automated order and payment kiosks can process most in-store transactions.

Delivery: Food delivery apps and services expand the size of your market and customer base.

Operations and productivity checklist

Back office management: Software for inventory management, order processing, billing, accounting and other processes improve productivity. Automation of business processes allows leadership more time to focus on revenue-generating activities.

Operational systems: Smart POS systems, mobile POS, menu boards, and employee scheduling apps increase customer and employee satisfaction.

Digital training: Maintaining policy and resource materials online enables faster training of new employees and improves adherence to company policies.

Productivity software: Additional software, apps and systems for project management, appointments and reservations, on-boarding, human resources functions, workplace supplies and communications make everyone more productive, impacting the bottom line.

BYOD: Policies for scheduling, communication and training materials that allow employees to use their own devices increase adoption and efficiency.

Cyber-security: Next-generation firewalls, and defense-in-depth cyber-security strategies protect POS, website and back-office systems from hackers.

The list of possible digital innovations is endless. And it changes constantly. Hence the need to accelerate the pace of innovation to gain a competitive advantage. To maintain the level of urgency required, the involvement of the CEO or owner is critical.

The good news is that the impact of digital initiatives can be measured online. Thus, data-driven, smaller digital initiatives executed and evaluated quickly add up to generate significant franchise growth.


Carl Mazzanti is the co-founder and president of eMazzanti Technologies and frequent business conference speaker and technology talk show guest.

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