Franchise Development Teams Adopted AI Tools Aggressively For Lead Generation in 2025
By: Michael Alston for Franchise Insights
February 22, 2026 – Faced with aggressive goals for system growth, increased competition, and technological transformation of lead generation, franchise developers employed AI to gain advantage and lower costs. As evidence, only 11.3% of respondents said they will not be using AI by the end of 2026.
In 2025, 62.5% of respondents to the 2026 Franchise Development Lead Generation Survey deployed AI tools in at least one part of their processes in pursuit of creative options, lower costs or improved performance. While franchises increasing their expansion budgets (18.5%) included all tiers of system sizes, 76.7% made tactical changes in their budget allocations among the largest paid sources.
At least 62.5% of Franchise Development teams adopted Artificial Intelligence tools in one or more areas of their lead generation efforts.
AI tools gained widespread adoption in 2025 in the category of content generation, either writing or graphics, where they were deployed in 62.5% of all franchise lead generation efforts.
Creative ad generation (creating images and text for ad building) saw the second highest rate of usage, by 50.6% of franchise lead generation teams.
Almost 44% of franchisors used AI tools in the area of data analysis or insights in pursuit of franchise sales.
Among franchise teams, 42% said they employed AI features offered by Google (e.g. Performance Max, AI Max) in their paid lead generation efforts. Google AI Overviews went to general release in May of 2024, and became perhaps the most disruptive change to the search experience since the launch of paid advertising (blue links and text ads) to the platform more than twenty-five years ago.
These search experience changes along with unfamiliar AI advertising features may have contributed to franchise development teams reporting a decline in Google usage from 75.6% in 2025 to 74.7% in 2026, a drop of 1%, as consumers and advertisers adapt to the changes. Moreover, this is a decline from an expected usage of 87% in 2025 from the January 2025 survey. In addition to the changes in the consumer and advertiser experience, competition from chatbots like ChatGPT and Perplexity, along with experimentation with less mature sources like LinkedIn and TikTok may have contributed to that drop.
Despite widespread consumer usage of AI Chatbots, only 19.5% of respondents reported using those tools in their lead generation efforts in 2025.
Nonetheless, Google still enjoys about 90% of search market share, and reported searches increasing by over 50% in the months after launching AI Overviews.
Less than a third of franchise development teams (31.6%) reported using AI features in in Instagram and Facebook advertising platforms from Meta (e.g. Advantage+ Creative, Meta AI). Given that Meta was used by 76.9% of franchise teams in 2025, that means that only 41% of the teams using Meta are using their AI advertising features as of January 2026.
More than 28% of teams used various AI tools for contacting or qualifying leads in 2025.
LinkedIn paid ad features employing AI (e.g. Predictive Audiences, AI Ad Variants) were used by 26.9% of teams, or about half of those using LinkedIn (57%) for franchise lead generation in 2025.
Ironically, despite widespread consumer usage of AI Chatbots, only 19.5% of respondents reported using those tools in their lead generation efforts in 2025.
Only 11.3% of respondents say they will NOT be using AI by the end of 2026.
Supporting the validity of data from the Franchise Insights 2026 Franchise Development Lead Generation Sources survey, a broad cross-section of franchise development teams participated, from emerging systems to well-established franchises with many thousands of units.
FranchiseInsights.com surveys franchisors periodically to get a pulse on the industry, provide benchmarking and identify franchise development best practices. This survey was conducted in early January 2026.
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Published on Sunday, February 22nd, 2026.