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What is an Advertising Franchise?

Carol Francois
Carol Francois

An advertising franchise is a business arrangement that is not typically found in other industries. A franchise is a business structure where the parent company sells the rights to the franchisee to sell its trademarked products or use its techniques. In a typical franchise arrangement, the product or technique being sold is designed to create a specific final product. The same process is repeated, using the parent company's technique, creating a product that meets specific quality guidelines. Common franchises include fast food and retail clothing stores.

Typically, an advertising firm is a service-oriented business, responsible for gaining new clients and creating new advertising campaigns. This type of work requires creativity, innovation, and entrepreneurship. New clients are obtained through a combination of bid submissions, project proposals, and active advertising for new clients.

Businessman with a briefcase
Businessman with a briefcase

In an advertising franchise, a large advertising firm sells its name to franchisees to use, along with its methods and techniques. The franchise agreement for this type of firm includes location and client restrictions, types of work that can be accepted, and a design approval process. Although the details may vary, many parent firms retain total creative control.

Advertising is a niche business, with firms typically specializing in a particular industry or market sector. The firm may allow franchisees to use its brand name, but restrict the activities to a particular type of client or service offering. The purpose behind this structure is to provide sufficient revenue opportunities, but minimize the breadth of products offered.

Restrictions on physical location or territory come into effect only where there are multiple advertising franchise firms located within the same large city. Typically, the restrictions are based on the type of work, so there is no overlap. For example, one office may specialize in print media campaigns, while another works almost exclusively on Internet-based strategies.

Within the field of advertising, there is a huge array of products, services, and methods used to meet the clients' requirements. Some advertising is designed to capture immediate attention and promote action, while others may be for informational purposes. Print, television, Internet, and viral marketing are all tools that can be used to meet the clients' objectives within the budget and time frame allocated.

All design ideas and campaigns proposed by the advertising franchise must be approved by the parent firm. This is a quality assurance process, designed to ensure the reputation of the brand is maintained. This oversight and final control can provide additional support and access to expertise that is useful during the initial development of the business.

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