Same Boat, Different Storms: Effect of Digital Marketing Emphasis on Franchisor and Franchisee Performance

This thesis investigates the impact of franchisors’ digital marketing emphasis on both franchisor firm value and franchisee-declared bankruptcy filings. I show that a 10 percent increase in digital marketing emphasis corresponds to a 7.5 percent rise in franchisee-declared bankruptcy filings. Furthermore, higher levels of marketing agility exacerbate these negative outcomes for both franchisors and franchisees. Together, these findings reveal potential risks of digital marketing emphasis for franchising and offer guidance for managing franchisor–franchisee relationships in the digital environment.