Can the Auntie Annes Ad Fund be used for customized materials (e.g., cups)?
Auntie_Annes Franchise · 2024 FDDAnswer from 2024 FDD Document
We may use the Ad Fund to meet the costs of administering, preparing, and conducting national, local, or regional advertising, promotional, or brand building programs of any kind, including the cost of (i) preparing and conducting television, radio, magazine, newspaper, and digital advertising campaigns and other public relations activities (including, but not limited to, for purposes of brand reputation management), (ii) employing public relations firms and advertising agencies to assist in these activities, and (iii) conducting other activities that are directly or indirectly designed to promote the System, its franchisees, and/or increase System sales, such as limited-time menu offerings, crew incentives, franchisee incentive and/or promotional programs, customized materials (e.g., cups), up-sell programs, guest response programs, manager/employee recognition programs, quality assurance and food safety programs, mystery shop and shopper programs, brand websites and ordering platforms, brand applications, social media account administration and promotion, and in-store equipment and technologies related to such marketing programs.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 61–77)
What This Means (2024 FDD)
According to Auntie Annes' 2024 Franchise Disclosure Document, the Ad Fund can be used for customized materials such as cups. Auntie Anne's may use the Ad Fund to cover the costs of administering national, local, or regional advertising, promotional, or brand-building programs. These programs can include the cost of preparing and conducting advertising campaigns via television, radio, magazines, newspapers, and digital platforms, as well as other public relations activities.
In addition, the Ad Fund may be used to employ public relations firms and advertising agencies to assist in these activities and conduct other activities that are directly or indirectly designed to promote the Auntie Annes system, its franchisees, and/or increase system sales. Examples of such activities include limited-time menu offerings, crew incentives, franchisee incentive and/or promotional programs, customized materials (e.g., cups), up-sell programs, guest response programs, manager/employee recognition programs, quality assurance and food safety programs, mystery shop and shopper programs, brand websites and ordering platforms, brand applications, social media account administration and promotion, and in-store equipment and technologies related to such marketing programs.
This means that Auntie Annes franchisees could potentially benefit from the Ad Fund through the provision of customized materials like cups, which can help promote the brand and increase sales. However, Auntie Anne's retains sole authority to direct all advertising programs and promotions and uses of the Ad Fund, with sole control over the creative concepts, materials, and media used in the programs, and the placement and allocation of advertising. Therefore, while the Ad Fund can be used for customized materials, franchisees do not have direct control over how the funds are spent or which specific materials are produced.
In fiscal year 2023, the Ad Fund expenditures were allocated as follows: 28% on media placement, 37% on production and agency fees, 9% on guest response programs and menu innovation projects, 25% on brand and category marketing expenses, and 1% on administrative expenses. This breakdown provides insight into how Auntie Anne's has allocated the Ad Fund in the past, but it is not a guarantee of future spending allocations. Prospective franchisees should be aware that Auntie Anne's has the right to change these allocations at its discretion.