- Have each franchise select affiliates in their community who have a high engagement rate, a location that lets them realistically buy from the franchise, and audience demographics that match the franchise's.
- Offer competitive affiliate commissions based on industry standards, and consider adding bonuses for high-performers.
- Affiliate software gives you more control than affiliate networks, and lets you build affiliate relationships without a 'middleman' (note: you'll have to find your own affiliates).
By setting up an affiliate program, franchises can leverage trusted content creators’ referrals to drive growth. It’s a mutually beneficial partnership. Franchises gain access to the affiliate’s engaged following of potential new customers, and the affiliate earns money for successfully bringing new customers to the franchise.
In this article, we’ll explore how to create an optimized affiliate program for your own franchises. We’ll cover how to structure it, recruit partners, increase engagement, and track performance.
What is franchise affiliate marketing?
Franchise affiliate marketing is when your franchisees recruit content creators, like bloggers, vloggers, podcasters, and social media influencers, to promote your products and services to their own businesses. These creators are called affiliates.
First, your franchisees identify influencers whose audience matches your ideal target customer profile. For example, a fitness franchise would look for health and wellness bloggers and Instagrammers.
The creators sign up for your affiliate program. Then, your franchise provides them with a special affiliate link that they can include in their content. When the creator’s audience clicks on that affiliate link and makes a purchase from your franchise, that affiliate receives a commission.
This structure creates a win-win partnership. Your franchises get to tap into the affiliate’s already engaged following. Meanwhile, the affiliate earns commissions for playing an active role in referring new business.
How does affiliate marketing for franchises work?
In franchise affiliate marketing, a company will use affiliate software to build and manage an affiliate program across all its franchise locations. Sometimes, a brand has one program that all affiliates promote universally. The same links and messaging are used brand-wide. This structure is an easy, straightforward solution.
But with the right software, you can create a distinct affiliate program for each franchise location. Each franchise can recruit affiliates specific to their area and provide them with links for their location. This enables hyper-targeted digital marketing by geography. It also helps with local SEO. Partners can be provided with region-specific assets and messaging to promote.
While programs are localized, the parent company still gets a consolidated view of reporting thanks to the unified software backend. So, high-level trends and top-performing affiliates can be identified across the brand.
The platform also allows flexibility. Commissions, terminology, and other branding elements can be standardized across all locations. Or, they can be customized per region as needed. Partners still feel connected to their local franchise and can promote it authentically. And franchises get pre-qualified referrals from trusted local voices.
Why are franchise affiliate programs beneficial?
Affiliate marketing offers many advantages for franchise owners:
- Leverages trust: People trust recommendations from creators far more than they trust branded ads. Affiliate marketing helps increase brand recognition.
- Targeted reach: Affiliates have niche audiences that already match your target customer profile. Partnering provides hyper-targeted access to those communities.
- Full control over affiliates: Your franchise retains control over who promotes your brand, how they promote it, and how much you pay them
- Low risk: You only pay affiliates after they’ve successfully driven sales. It is much less risky than expensive broad ad campaigns.
- Trackable: Properly structured programs let you measure the ROI generated by each affiliate’s efforts. Identify what’s working.
- Cost effective: Commissioning affiliates who yield results costs far less than purchasing similar reach through advertising. Big savings.
- Boosts sales:Most importantly, affiliate marketing works. It’s a proven way to increase traffic, leads, and revenue for franchise businesses.
Affiliate marketing helps franchisees tap into the power of word-of-mouth and influencer recommendations – at scale. The result is more high-quality leads and sales.
Franchise affiliate marketing best practices
Ready to dive into affiliate marketing? Here are some top tips for creating a high-performing and efficient program:
Choose the right affiliate software (not a network)
The foundation of your affiliate program is choosing the right software. Rather than an affiliate network, specialized software that meets franchise needs is best.
Affiliate networks aren’t usually built for franchises. They take a hands-off approach and withhold important performance data. But software empowers you and your franchisees to actively manage partnerships.
Networks also force you to use their own pre-approved affiliates exclusively. In-house software lets you hand-pick ideal partners. So, with the right software, each franchise location can identify ideal partners tailored to their local community. Networks act as middlemen, while software enables direct relationships between your franchisees and affiliates. Direct relationships are important. With it, your franchisees can provide personalized support and build rapport with their partners.
Not all affiliate software is built for a franchise structure’s needs, however. Look for software that handles multi-location setups with ease. Referral Rock is flexible enough to run multiple franchise programs at once, and gives you robust data on how all your programs are performing in one place
Set strategic commissions
The affiliate commission structure you offer is key for attracting affiliates and incentivizing ongoing promotions. You need to offer competitive commissions to stand out – but only pay out what you can afford to spend on each sale.
Here are some tips to get started:
- Research competitor affiliate programs as benchmarks for commission rates within your industry. You need to offer competitive commissions to stand out.
- Analyze your margins, average order value, and other financial factors. Pick a commission rate that is sustainable long-term for your overall business model and margins. Don’t overcommit.
- Pay commissions as cash (say, via PayPal), which is far more enticing to affiliates than gift cards or store credit. Remember that affiliates are technically business owners, too. They run an affiliate business, so they expect cash compensation for their work.
- Standardize commission rates across franchises to start. But you could vary commission rates if certain regions have higher-performing affiliates that warrant better incentives.
Outline commission rules and bonuses
Be very clear on what commission-qualifying actions are, as well as the attribution window. Some aspects to consider are:
- Will affiliates only earn commissions from direct sales? Or will you also reward leads?
- How long after an initial click can you attribute a sale back to the referring affiliate? It could be anywhere from 24 hours to 1 week – or even months. Choose appropriately based on your typical sales cycle.
- If multiple affiliates are involved in influencing a customer before a transaction, which one gets credit? Standard options are either first-click or last-click attribution.
- Will affiliates be able to offer discounts for their audience?
- Can affiliates qualify for higher commissions – or bonuses at volume milestones – to encourage ongoing promotions?
- Will they earn a one-time bonus if the sales they drive reach a certain threshold (in a given period)?
- Will they receive a permanent commission increase when they hit a certain lifetime referral goal? (This is known as a tiered commission.)
These decisions will shape how affiliates approach promoting your products. Clear commission rules will help you avoid disputes and build trust with your affiliates. It also creates a level playing field for all affiliates.
Have franchises find and select affiliates carefully
Now, let’s talk about how to find affiliates. Each franchise recruiter should vet and pick affiliates tailored to their local community. Ideal partners have an audience demographic aligned with your brand and products. And high, positive engagement from their audience is a sign they are trusted. Don’t be afraid to tap into data from your CRM for help with this process.
Affiliate content should contextually match your franchise. If location-dependent, an affiliate should be located in the same geographic area as the given franchise. It’s important for them to have an existing influence in your franchise’s geographic community, so they are promoting the franchise they could realistically buy from. A strong reputation and social proof always help increase audience engagement and trust.
Depending on your niche and audience, franchises should look for bloggers, social media personalities, website owners, and/or industry experts. If the franchise has known customers who create content, even better. You could also open an affiliate application and have potential affiliates reach out to each franchise.
Protect your reputation by avoiding partners who seem spammy. Blasting affiliate links relentlessly might make you lose potential customers instead of winning them over.
Create an affiliate agreement
Before granting any affiliate access to promote your franchise, have them sign an affiliate agreement that outlines the following:
- Commission structures, qualifying actions, attribution details, and payment terms
- Policies on trademark usage, branding guidelines, and disclosure requirements. Any other compliance and legal matters will also be resolved here.
- Overall terms of the relationship and causes for potential termination.
Having clear expectations in writing prevents misunderstandings down the road. Provide training and support to help affiliates succeed.
Communicate with affiliates regularly
Regular communication ensures affiliates stay actively engaged in promoting your franchise. First, set up onboarding training on your brand style guide, products, what they can and can’t say, and ideal messaging. This can be done on a franchise level, through each franchise’s affiliate software dashboard. But if all affiliate programs and franchises are similar enough, you can design and implement the same training for all franchises’ affiliates.
During the partnership, send periodic updates on company news, product launches, commission changes, and program policy changes so they are in the loop. You can also have each franchise manager touch base with their affiliates often. This can be done via email, calls, newsletters, or even virtual meetups.
Make sure affiliates know who their franchise contact is for questions and feedback. Keep lines of communication open.
Track your affiliates’ ROI
Finally, don’t be afraid to leverage the full power of your affiliate software’s reporting features. Monitor engagement and returns across all your programs. Look at which affiliates drive the most conversions for each location, and double down on partnerships with proven performers.
Based on the data you’ve collected and analyzed, decide if you need to refine your overarching program – or if your affiliate program decisions are working well. You might also find that specific franchise programs need refining, or that certain commission structures or promotional calendars yield the best results. The end goal is to figure out how you can continue optimizing the program strategy over time based on data.
Robust analytics empower you to spot successes, identify issues early, and fine-tune your approach for maximum impact.
Start a high-performing franchise affiliate program
Franchise affiliate marketing accomplishes stellar results at a fraction of the cost of traditional advertising. When done right, it delivers motivated buyers to your doors. It also builds lasting relationships with brand advocates.
Achieving this type of success requires the right technology foundation. Referral Rock provides purpose-built affiliate software to help franchise systems optimize their programs.
With Referral Rock, every franchise gets a customized affiliate program deeply integrated with their community. You get complete data visibility across all locations to spot trends and top affiliates. Plus, automation handles all the administrative tasks seamlessly behind the scenes.
Sign up for a demo to learn more about streamlining your multi-location affiliate marketing.