When Carlo Gonzaga, CEO of Taste Holdings, starts researching a potential new brand for acquisition, he first makes it his mission to understand every competitor within the sector he is interested in.
“For example, in the take-away food sector, when I was researching the competitors to the Fish &Chip Co, I went to each and every competitor in the market place and tasted one of everything,” he says.
“It was important for me to understand where price, value and portion sizes intersected, so that I could see the position of our own value proposition in the market.”
Perceived value and each brand’s unique selling proposition determine sales. If customers see a high perceived value in your brand, they are more likely to spend money with you. So how do you determine how your brand is perceived?
From a franchisor perspective, this involves understanding the competition’s positioning and offering, but from a franchisee perspective there is also an important lesson: You might not be able to choose your menu or system structure (or more appropriately, you have chosen the franchise you invested in because of these things, but they are fixed), but you can keep an eye on the competition, particularly in terms of customer service.
You can also keep tabs on what does and doesn’t sell well in your store, and give that feedback to your franchisor.
The best way to add value and ensure customers come back is through customer service. Nathalie Schooling, customer experience guru and founder of N’lighten, says delivering good service today is an entry point – real sales come from taking customer experience to the next level.
“To engage with your customers’ emotions will give you and your business the competitive edge. Those emotions drive their behaviour and their choices,” she says. “Fantastic customer experience is the secret ingredient which will make them repeat customers, while simultaneously prompting them to tell all their friends and family about your business.
“When customers know that the company they buy from cares about them, they are more likely to stay with that company. When you add sensational customer service to that mix, it’s a no-brainer.”
In addition, while finding new clients costs money for the franchisor (from your marketing and royalty fees), retaining existing clients and having them tell their friends and family about your business is your best form of advertising – and it costs you nothing.
Focusing on customer experience will also add value to the brand. Your franchisor is focusing on brand growth – it’s up to you to make sure your customers keep coming back.
Word of mouth
“Customers pay more attention to personal recommendations than to conventional marketing messages,” says Schooling. “Delighting your customers and consistently engaging with them at every point in their ‘buying journey’ will make them your greatest ambassadors.”