Developing a Social Media Policy for Franchise Systems

Effective use of social media is challenging for any business, but creating a strategy that works for an entire franchise system can be even more difficult.  Once that strategy is developed, it needs to be supplemented with a social media policy that protects you and your franchisees.

Below are four things to consider as you develop a social media policy.

  1. Establish franchisor’s ownership of the account.

In the franchise agreement, the franchisor must reserve the right to create any social media accounts for the brand. By owning each account, the franchisor manages the risk that franchisees will post content that does not align with brand standards, is objectionable, or, most dangerous of all, subjects the franchisor to legal liability. The franchisor will own all social media accounts, but that can mean either a single presence for the entire brand or multiple location-specific pages/accounts. Either option can be effective, and the decision depends on what fits best with the brand’s personality and strategies.

  1. Develop procedures for handling social media access after a franchisee leaves the system.

The franchisor’s legal control should be well established and absolute in the franchise agreement, but the practical controls are just as important. Franchisors should have administrative control of every account that a franchisee may access. It’s critical that a franchisor has the legal and actual ability to deactivate the entire account and remove or post any content at any time and for any reason.  The franchisor should have full legal and practical control to access any location-specific page for a franchisee that leaves the system upon termination or expiration of the franchise agreement. Additionally, the franchisor must be able to cut off a franchisee’s access to the account at any time and for any reason. This is usually done by changing permissions or credentials. In situations where the franchisee is ignoring brand standards, defaulting under the franchise agreement, or generally going rogue, these controls can save the franchisor.  Not only will this control over local pages protect a franchisor against unwanted posts from a terminated or rogue franchisee, but it will also allow the franchisor to retain customer engagement in a territory even after a franchisee has left.

  1. Establish minimum protections.

At a minimum, the franchisor’s social media policy should prohibit content that is (i) false, (ii) misleading, (iii) disparaging of the brand, brand trademarks, the franchisor, or customers, or (iv) offensive, inflammatory, or indecent.

Minimum protections also include guidelines to preserve consistency across the franchise system. A franchisor’s social media policy should include standards for the following:

  • use of trademarks (the franchisor’s trademark style guide is a resource here)
  • voice of the posts,
  • hashtags,
  • fonts and color schemes,
  • captions,
  • use of another party’s content,
  • use of a customer’s image,
  • use of memes, and
  • images generally.

To prevent the liability of the franchisor, the most important items in this list are (i) protecting the use of the franchisor’s trademarks, (ii) ensuring that franchisees comply with all laws, rules, and regulations that govern the intellectual property and copyright rights of others, and (iii) requiring franchisees to seek permission before posting any images of customers.

Don’t forget to consult an experienced franchise attorney to help you draft your franchise system’s social media policy.

 

Photo of Ashley Nielsen, CFE Ashley Nielsen, CFE

As a member of the largest franchise practice in North Carolina, she regularly counsels start-up and early-stage franchisors in building their brands and navigating complex state and federal franchise regulations.   She also serves as general corporate counsel to these and other retail and…

As a member of the largest franchise practice in North Carolina, she regularly counsels start-up and early-stage franchisors in building their brands and navigating complex state and federal franchise regulations.   She also serves as general corporate counsel to these and other retail and restaurant clients and assists with transactions that range from routine to complex.  Ashley has extensive experience preparing franchise disclosure documents (“FDDs”), which benefits not only the franchisors who seek her strategic advice, but also the franchisees who hire her to evaluate FDDs and negotiate franchise agreements and leases.  Ashley speaks to franchisors and teaches other attorneys about franchising and related topics.   In 2019, she received the Certified Franchise Executive (“CFE”) designation.

Photo of Carlie Smith Carlie Smith

Carlie works with franchisors and franchisees to grow their brands and businesses by helping them to comply with state and federal franchise regulations and navigate corporate transactions.  Carlie often assists hospitality and restaurant brands in navigating the regulatory permitting process.

Prior to joining…

Carlie works with franchisors and franchisees to grow their brands and businesses by helping them to comply with state and federal franchise regulations and navigate corporate transactions.  Carlie often assists hospitality and restaurant brands in navigating the regulatory permitting process.

Prior to joining Manning Fulton, Carlie worked as a law clerk at Kirton McConkie, a Salt Lake City law firm. During law school she interned with Judge Thomas B. Griffith of the United States Court of Appeals for the District of Columbia Circuit and Justice Thomas R. Lee of the Utah Supreme Court.