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Home My WebLink About01. 2025 VLMD Operating Plan Draft V2DISCOVER VAIL VLMD 2025 OPERATING PLAN SEPTEMBER 4 DRAFT Agenda ●2024 Summer Results to Date ●Vail Occupancy ●Informing on the Strategy ●2025 Operating plan Board Action Summary = Discussion on updated recommended budgets by priority = Board vote = Detail will not be included in September 17 presentation to Town Council / VLMD 2024 REVIEW & PRELIMINARY RESULTS 2024 CAMPAIGN A MOMENT FOR SPONTANEITY EMPTY NESTER & NON-FAMILY LATIN X (IN SPANISH) OUTDOOR ENTHUSIAST WEBSITE UPDATES, PRINT & DIGITAL ADSVIDEO ASSETS SEGMENTED BY AUDIENCE Social Media Edits (Vertical and Horizontal) :06, :15, :30 second spots FAMILY DELIVERABLES -Efforts this spring and summer have increased engagement and resulted in: Source: Adara Impact, 5/15/24-8/27/24 3.5k+ Hotel Bookings 2023: 689 146k+ Hotel Searches 2023: 25k+ $2.6M+ Hotel Revenue 2023: $605k+ 50k+ Flight Searches 2023: 84k+ 3.7k+ Flight Bookings 2023: 7k+ Strong 2024 Summer Campaign Performance Early and late winter efforts focused on prospective visitors in drive markets, supporting lodging specials. Source: Adara Impact 2.3k+ Hotel Bookings 2023: 500 74k+ Hotel Searches 2023: 20k+ $1.5M+ Hotel Revenue 2023: $500k+ Strong Early and Late Winter Campaign Performance Building Loyalty and Driving Guest Engagement Continued database growth trending slightly below 2024 goal of 310k ●Growth pace has slowed slightly since 2023 ●Efforts in place to drive growth in WiFi, Newsletter and Event data capture 344 Campaigns +163% YoY Content Personalization Email Performance Exceeding Goals Campaign results YoY to date as of 07/31 ●Segmentation ○1st Party (location, email/web engagement) ○3rd party (family, income, interests) ●ChatGPT leveraged for personalized content at scale 2.25M Sends +24% YoY 36.5k Clicks +12% YoY 0.43% Unsub.Rate -0.26 ppt YoY INFORMING THE 2025 STRATEGY Vail Industry Summer Occupancy +5%+4% Summer ADR -1%+3% EGE (airport) enplanements +20% Mountain Resort Industry Trends Vail Occupancy Normalization Winter 2023-24 -2% Occupancy +6% Average Daily Rate (ADR) Summer 2024 (as of 8/15) +5% Occupancy -1% Average Daily Rate (ADR) 4.1 to 4.4 Overnight Length of Stay increase NPS climbing to 74% this summer vs. 72% last summer Word of mouth and Google remain the sources most relied upon for planning trips to Vail with DiscoverVail.com increasing YoY. Dining, shopping and hiking remained the most popular activities for guests. However, a decrease in dining and shopping spend YoY 45% of respondents attended an event in Vail. 51% said an event was the main or major reason they visited Summer Visitor Survey Preliminary Results Traveler Familiarity & Destination Preference 25% 70% Only 25% of Colorado visitors are familiar with things to do in the state. 70% of Mountain Travelers prefer familiar destinations over new ones. Leisure & Business Travel Trends 9% 18% One in ten US leisure travelers intend to travel to a mountain destination in the next 12 months. Millennials and the Midwest over-index in desire to vacation in a mountain destination. 35% 15% Percentage of Gen Z and Millennial business travelers who plan to extend a business trip in 2024. From 2019-2023, transient business traveler length of stay increased 15%. US Leisure Traveler US Business Traveler *State of the American Traveler **Hilton, 2024 Travel Trends Affluent Traveler Profile Arival, “The Affluent Travel Experiences” 46% 67% 1 in 5 travelers are affluent but they account for 46% of the spend on activities and attractions. Affluent travelers (age 18-44) account for two thirds of spend on activities and attractions. Young Affluent Traveler Messaging Opportunities Arival, “The Affluent Travel Experiences” 75% 3 in 4 say destination activities and attractions are very influential in destination selection. Far more interested in active experiences and adventure 2024 CAMPAIGN UPDATE2025 OPERATING PLAN AND BUDGET 2024 // Poised for Change Knowing there are big transitions are coming: -Destination Marketing Reorganization -First time content created for winter promotion -Campaigns to support early and late season -Creating a Strategic Plan: process starting in october -Including Marketing, Special Event Strategy, the Vail Experience and Business Development -New Brand creation in process - 2024 // Increased Efficiencies -Continue improving on campaigns and content for early and late winter promotion -Investing in platforms that will produce stronger data to inform progress -Evolve 2025 Campaign Strategy to enhance and expand the existing campaign with unique storytelling 2025 Objective & Priorities Drive responsible year-round revenue growth in Vail by targeting overnight guests who stay longer and spend more, while effectively communicating community and brand values. Areas of focus include increasing mid-week and lower demand time period stays. Business Objective Target high net worth guests, maximize longer stays and higher spend and gain greater understanding of customer through research while educating on community values. Optimize Visitation Grow customer database and use data to better understand guest to enhance engagement & loyalty. Build Loyalty Develop and deliver upon a brand position that reflects community values, differentiates Vail in ways that build its competitive edge, and inspires all to care for Vail. Lead Stewardship Position Vail as the Premier International Mountain Resort Community and work with community partners to define, support and deliver on the brand. Brand Positioning 2025 Preliminary Business Goals May - October Indicator 2021 Results 2022 Results 2023 Results 2024 Goal 2024 Forecast 2025 Preliminary Goals 4% Sales Tax $13,674,538 $14,222,156 $14,016,278 $14,222,156 Flat with 2022 YTD actuals $14,037,837 $14,037,837 Flat with 2024 1.4% VLMD Tax Revenue $1,482,956 $1,457,425 $1,433,980 $1,338,457 $1,437,943 $1,437,943 Flat with 2024 Occupancy 45%43%43%45%46%47% Group Occupancy 15%24% 22% 25%24%24% Preliminary Marketing Goals Goal 2022 Actual 2023 Actual 2024 Goal 2025 Goal Increase Destination (OOS) Visitation 6/1 - 9/30 * WiFi: 34,397 Guest Profiler: 50.2% Web Visits: 353,703 * WiFi: 34,220 Guest Profiler: 57.5% Web Visits: 352,346 5% increase YOY 3% increase over 2024 actuals Build Loyalty: Repeat visitation 6/1 - 9/30 *Repeat visit within 3 years 3.7% of 2021 summer WiFi visitors returned in 2022 summer (based on YOY, not 3 years) 5.6% of 2022 summer WiFi visitors returned in 2023 summer (based on YOY, not 3 years) 6.4% of 2023 summer WiFi visitors will return in 2024 summer % WiFi Goal will be determined at end of 2024 when WiFi visitation has been in place for over 3 years Increase Occupancy 11/15 - 12/20 (Starting 2024) 36.6%37.4%39.3% 5% increase YOY 3% increase over 2024 actuals *4/1 - 4/20 (Starting 2025) 46.0%43.9%NA 49.7% (Easter April 20, 2025) 10 Year Revenue and Expenditure Comparison -Prior to 2020, annual revenues and expenditures totaled around $3.5M; revenues averaging 6% annual increase -Revenues appear to be normalizing after COVID; new “normal” lodging tax revenue projected at $5.5M Where blue bar is taller than green bar = use of reserves 10-Year Reserves History 2025 Revenue Projection $ 5,583,000 ●Lodging Tax revenue is forecasted at $5,520,000 ○This represents a 1% increase from 2024 Forecast & 1% increase from 2023 actuals ●Interest revenue is projected at $63,000 2025 Proposed Budget (excluding event funding)$ 6,503,000 ●Flat with the 2024 Budget; 7% increase from 2023 actuals ○Annual Baseline Budget: $5,483,000 ○Contingency: $ 100,000 ○Initiatives Using Reserves $ 920,000 Projected reserves are forecasted to be $1,590,628 at the end of 2025, or 29% of annual revenues 2025 Proposed Event Budget $ 3,000,000 ●$3.0M placeholder for event funding directly offset by a transfer from the General Fund & Business License Fee collections 2025 Proposed Budget Priority Based Budget Breakout Optimize VISITATION Strategy ●Decrease ○Campaign production ●Maintain ○Current level of Groups Sales ○Winter early and late lodging campaigns ○Maintain focus on key destination markets ○Destination and Front Range paid media efforts, emphasizing Destination ●Enhance ○International trade show attendance ○Mexico paid media / public relations Optimize VISITATION One-time Spend Scenarios Priority Recommendation Total Tactic Spend Visitation Media B: $362,204 $2,016,005 Visitation Campaign A: $120,000 $320,000 Visitation Mexico Media B: $11,000 $70,300 Visitation International B: $69,700 $69,700 Campaign Effectiveness Study B: $59,000 $59,000 TOTAL Recommended $621,904 CRM Strategy ●Leverage Litmus for continued growth in email hyper-personalization ●Enhance AI-based content versioning within email ●Grow depth of customer database through enhanced data capture and improved 3rd party matching, including exploration of financial and transactional metrics ●Grow highly-engaged newsletter signup audience on web and in-market ●Email ADA Compliance ●Integrate Lodging Data from Ripe 22% 25% Build LOYALTY: CRM Build LOYALTY: Content Content Strategy ●Grow share of voice through new and higher-ranking keywords: 45% increase in Page 1 keywords YoY ●Continue to populate DiscoverVail.com with high-quality content ○Organic traffic drives the most engaged (53%) and valuable users to the website, with visitors spending 82% more time on the site than other channels. ●Support email program with data-driven content decisions ●Future-proof website by executing SEO fundamentals and AI SEO trends ●Enhance social media strategy with Influencers and TikTok 22% 25% 50%52% Build LOYALTY: Creators Drive Discovery A content creator creates & delivers compelling content to inspire travelers early & often. “There’s not really a way to effectively measure a direct return of investment on essential indicators like revenue. Engagement, reach and viewer numbers give a “general sense” if an influencer has been effective, said Puerto Rico’s Chandler.” - Skift 75% of travelers rely on social media for travel inspiration. — b Magazine 48% of TikTok-using travelers actually visited a destination – influenced (at least in part) by content they saw on the platform. — Future Partners *Case studies included in packet Build LOYALTY: Creators Drive Discovery Build LOYALTY One-time Spend Scenarios Priority Recommendation Total Tactic Spend - Email ADA Compliance - CRM/Analytics + Ripe - Website Personalization - Rebrand implementation into website - AI Facilitated Workshop and quarterly trends & tests B: $149,336 $149,336 Enhance Social Media Strategy B: $48,760 $204,880 TOTAL Recommended $198,096 Lead STEWARDSHIP 1% 7% Baseline Strategy (No Use of Reserves) ●Stewardship is fully integrated into our owned channels. In addition: ○Launch new brand to build Vail's competitive advantage ○Build brand campaign around true attributes and drive traveler intent. ○Sustain in-market stewardship campaign Baseline Strategy (No Use of Reserves) ●Build a 2025 brand campaign around true attributes and drive traveler intent. ●Strategy, production and launch of new brand in Vail and amplified in key markets BRAND Positioning 17% 21% BRAND Positioning One-time Spend Scenarios Priority Recommendation Total Tactic Spend Amplify new brand launch with key market activation A: $100,000 $231,000 TOTAL Recommended $100,000 Proposed 2025 Operating Budget One Time Use of Reserves Recommendation Visitation $621,904 Loyalty $198,096 Stewardship $0 Brand $100,000 Reserve Usage Proposed $920,000 Baseline $5,583,000 Total Operating Plan $6,503,000 Request of the Board Vail Local Marketing District Advisory Council is asked to approve or approve with changes, the 2025 VLMD Operating Plan and Budget of $6,503,000 to present to the Vail Local Marketing District on September 17. Thank you! Upcoming Meetings: VLMDAC Board Meeting Thursday, September 19, 2024, Grand View Room VLMD 2025 Meeting to Approve Operating Plan @Town Council Meeting Tuesday, September 17, 2024, Town Council Chambers