What is the Extreme Art Studio Brand Fund used for?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
pproved. If we do not approve of the materials within five days of our receipt of such materials, then they shall be deemed disapproved. You may not use any advertising, promotional or marketing materials that we have not approved or have disapproved.
9.3 BRAND FUND.
- 9.3.1 Recognizing the value of advertising and marketing to the goodwill and public image of Extreme Art Studio Businesses, we have established a national advertising and marketing fund ("Brand Fund") for marketing, developing and promoting the System, the Marks and Extreme Art Studio Businesses. You agree to contribute to the Brand Fund in an amount equal to one percent (1%) of your Gross Sales, due and payable in the same manner as the Royalty ("Brand Fund Contribution"). Extreme Art Studio Businesses owned by us or our affiliates may, but are not required to, contribute to the Brand Fund on the same basis as our franchisees.
- 9.3.2 We will direct all programs that the Brand Fund finances, with sole control over the creative concepts, materials and endorsements used, and their geographic, market and media placement and allocation. The Brand Fund may pay for preparing and producing video, audio and written materials and electronic media; developing, implementing and maintaining our System
Website (as defined in Section 9.5 below) or related websites that promote Extreme Art Studio Businesses and/or related strategies; administering regional and multi-regional marketing and advertising programs, including, without limitation, purchasing trade journal, direct mail, and other media advertising; using advertising, promotion and marketing agencies and other advisors to provide assistance; administering online advertising and marketing campaigns (including search engine, social media, email, and display ad campaigns); developing and maintaining application software designed to run on computers and similar devices, including tablets, smartphones and other mobile devices, as well as any evolutions or "next generations" of any such devices; to implement a loyalty program or other marketing programs designed to encourage the use of Extreme Art Studio Businesses; and supporting public relations, market research, and other advertising, promotion and marketing activities.
- 9.3.3 The Brand Fund periodically will give you samples of advertising, marketing, and promotional formats and materials at no cost that we may develop. The Brand Fund will sell you multiple copies of these materials at its direct cost of producing them, plus any related shipping, handling, and storage charges.
- 9.3.4 We will account for the Brand Fund separately from our other funds.
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2024 FDD)
According to Extreme Art Studio's 2024 Franchise Disclosure Document, the Brand Fund is used for marketing, developing, and promoting the Extreme Art Studio system, marks, and businesses. Franchisees contribute 1% of their gross sales to the Brand Fund. Extreme Art Studio has sole control over the creative concepts, materials, and placements of advertising programs financed by the fund.
The Brand Fund may be used to create video, audio, written, and electronic materials, as well as to develop and maintain the Extreme Art Studio System Website and related strategies. It also covers administering regional and multi-regional marketing and advertising programs, including purchasing media advertising, using advertising agencies, and managing online campaigns. The fund can also be used to develop and maintain application software for computers, tablets, smartphones, and other mobile devices, and to implement loyalty or other marketing programs. Additionally, the Brand Fund supports public relations, market research, and other advertising, promotion, and marketing activities.
The purpose of the Brand Fund is to maximize recognition of the Extreme Art Studio marks, increase patronage of Extreme Art Studio businesses, and promote the brand generally. While Extreme Art Studio aims to develop materials and programs that benefit all franchisees, it cannot guarantee that expenditures in any specific area will be proportionate to the contributions from that area, or that any franchisee will directly benefit in proportion to their contribution. The Brand Fund will not be used for advertising that primarily solicits franchise sales, although a notation indicating "Franchises Available" is permitted. Extreme Art Studio will provide franchisees with samples of advertising materials at no cost and sell multiple copies at its direct cost of production, plus shipping, handling, and storage charges.