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Home My WebLink About2012-10-16 Agenda and Support Documentation Town Council Special SessionVAIL TOWN COUNCIL SPECIAL MEETING AGENDA VAIL TOWN COUNCIL CHAMBERS 75 S. Frontage Road W. Vail, CO 81657 11:30 A.M., OCTOBER 16, 2012 NOTE: Times of items are approximate, subject to change, and cannot be relied upon to determine at what time Council will consider an item. Public comments on work session item may be solicited by the Town Council 1. ITEM/TOPIC: VAIL LOCAL MARKETING DISTRICT MEETING: Resolution No. 1, Series 2012 for the Vail Local Marketing District. 2013 VLMD operating budget approval. (15 min.) PRESENTER(S): Kathleen Halloran/Judy Camp ACTION REQUESTED OF COUNCIL: Approve or approve with amendments VLMD Resolution No. 1, Series 2012 BACKGROUND: On September 18, Town Council sitting as the VLMD Board reviewed the 2013 Operating Plan and Budget. No changes have been made since that time. 10/16/2012 VAIL TOWN COUNCIL AGENDA MEMO MEETING DATE: October 16, 2012 ITEM/TOPIC: VAIL LOCAL MARKETING DISTRICT MEETING: Resolution No. 1, Series 2012 for the Vail Local Marketing District. 2013 VLMD operating budget approval. PRESENTER(S): Kathleen Halloran/Judy Camp ACTION REQUESTED OF COUNCIL: Approve or approve with amendments VLMD Resolution No. 1, Series 2012 BACKGROUND: On September 18, Town Council sitting as the VLMD Board reviewed the 2013 Operating Plan and Budget. No changes have been made since that time. ATTACHMENTS: VLMD 10/16/2012 To: Vail Town Council From: Kathleen Halloran and Kelli McDonald Date: October 16, 2012 Subject: Vail Local Marketing District 2013 Operating Plan and Budget I. BACKGROUND The mission of the Vail Local Marketing District is to market and promote Vail to attract overnight destination guests primarily during the May – October time frame, creating economic vitality by increasing both the visitor base and sales tax revenues. Results to date show an increase in sales tax collected, lodging occupancy and event attendance over the summer of 2011. On September 18, 2012 The Vail Local Marketing District gave direction to proceed with the proposed budget (initially proposed as “Plan B”). There have been no changes since that time. The marketing objective outlined in the VLMD operating plan is to continue the momentum and build on the powerful leadership position of the year-round Vail brand in order to: • Increase May – October occupancy • Increase sales tax revenue • Increase group occupancy • Optimize visitor mix • Increase net promoter score • Increase Vail brand awareness II. BUDGET DETAIL Revenue from lodging tax collections is estimated at $2,200,000 for 2013. The assumptions for this projection are consistent with the town’s expected tax revenue for 2012. The proposed budget includes $2,571,725 for 2013 programs. The projected ending fund balance for 2013 of $551,146 is 25% of annual revenues.(Council’s directive is a minimum fund balance of 25%). Expenditures are proposed at a total of $2,571,725, an increase of 9.8% from forecasted 2012. This increase is recommended to address recent successes and opportunities and to achieve the outlined marketing objectives. 1 - 1 - 1 10/16/2012 Town of Vail Page 2 • Destination proposed budget increases $124,000 to include additional digital media efforts, advertising and PR events in destination and international markets. This is broken down into the following: • International Sales / Marketing / PR $23,500 Increase direct involvement with Vail Recreation District to help coordinate and market Summer Camp program(s); Increase direct involvement with Vail Resorts’ International Express Desk to ensure they have products and are packaging these for wholesalers and communicating this booking channel to wholesalers; Coordinating and marketing a golf tournament in Vail for Latin American wholesalers and influencers; Develop public relations efforts for a golf tournament in Vail for Latin American wholesalers and influencers; Expanded spring media event and one-on-one appointments in Mexico City. The additional investment in the International market would contribute to the overall objective of increasing visits from this market from 2.8% to 5% year over year. • Destination Marketing $35,000 Focus on key destination markets with strategic marketing/advertising efforts. Examples of new initiatives include airline programs / partnership promotions, leveraging Colorado Tourism Office programs, in market advertising, Bravo! and / or Vail International Dance Festival opportunities. The additional investment in Destination markets would contribute to the overall objective of increasing visits from 56% to 60% year over year. • Destination / International Search & Online Display $65,500 Additional online display media, paid search efforts and associated ad service tracking fees; Multi-national SEO support to include: - Tracking daily rankings in major search engines internationally - Provide international tracking on technical configurations for international indexing and language tagging - Provide recommended copy to target keywords specific to country - International registration / placement of domain on multilingual speaking domains (such as travel and tourism related directories) Video Search Engine Optimization of existing Vail channels and Vail created videos on YouTube along with search engine promotion. 1 - 1 - 2 10/16/2012 Town of Vail Page 3 The additional investment in online search and display functions should result in increased online impressions and “clicks” in both categories by approximately 16%. Online orders are expected to increase by 36% in the search category and 17% in the display category. • Group Sales proposed budget increases by $110,000 from 2012 forecast. This increase would contribute to the overall objective of increasing group business year over year by 5%. This is broken down into the following: • A dedicated medical meetings sales manager $75,000 Establish deeper local relationships as well as increased presence at medical meeting industry meetings and associations. The focus would be on continuing medical education programs, medical device companies and other medical support meeting programs and symposiums. • Support & recruiting of large corporate programs $35,000 Includes travel and tradeshow of $25,000 and familiarization trips of $10,000. A new sales manager focusing on this vertical market frees up the current sales team to increase focus on corporate, association and other business with an expected increase in production from the Midwest / East Coast markets in these market segments. Other marketing objectives for 2013 include: • Front Range budget stays intact to maintain presence and share of voice • PR budget stays intact to maintain a prominent presence regionally, nationally and internationally • Research budget increases $14,000 to conduct another Burke Brand Research study as was done in 2011 • Web site budget decreases by $10,000 since Vail Mountain Marketing is providing services without a 3rd party vendor • Email marketing budget decreases by $21,000 since Vail Mountain Marketing is providing services without a 3rd party vendor • Professional Fees increase by $20,000 as a result of additional time spent traveling domestically and internationally and hosting international guests and media in Vail • Event Marketing increases by $30,000 as a place holder for an iconic event in 2013 not yet identified The budgetary changes outlined above reflect the goal of shifting dollars to attract more overnight destination guests to Vail through additional outreach and programs in 2013. 1 - 1 - 3 10/16/2012 Town of Vail Page 4 III. ACTION REQUESTED OF TOWN COUNCIL Staff recommends that Council approve VLMD Resolution No. 1, Series 2012, approving the submitted budget and appropriating $2,571,725 for marketing related expenditures beginning on the first day of January, 2013 and ending on the 31st day of December, 2013. ATTACHMENTS VLMD 2013 Proposed Operating Budget Resolution No. 1, Series 2012 1 - 1 - 4 10/16/2012 Vail Local Marketing District 2013 Proposed Budget 2011201220122013 ActualAmendedForecastProposed Income 310 · Lodging Tax2,145,988 2,000,000 2,200,000 2,200,000 399 · Interest Income857 1,200 1,200 1,200 Total Income2,146,845 2,001,200 2,201,200 2,201,200 Expense 6301 · Destination380,658 703,000 699,500 823,500 6302 · Front Range342,395 376,000 412,000 410,000 6303 · Groups and Meetings318,241 427,500 427,500 537,500 6304 · Public Relations Expenses79,453 92,000 92,000 92,000 6306 · Photography / Video107,861 75,000 80,000 85,000 6307 · Research73,800 71,225 93,425 107,225 6308 · Web Site49,885 30,000 55,000 45,000 6310 · Admin Miscellaneous3,492 7,500 7,500 7,500 6315 · Email Marketing24,407 24,500 24,500 4,000 6320 · Branding44,600 75,000 30,000 25,000 6400 · Contingency- 49,500 34,800 - 7000 · Professional Fees 7001 · Legal and Accounting20,000 20,000 20,000 20,000 7003 · Advertising Agent Fees50,000 50,000 50,000 50,000 7007 · Marketing Coordination-VVP/TOV125,000 125,000 125,000 125,000 7008 · PR - Professional Fees90,000 90,000 90,000 110,000 7011 · Partnership Fees 7015 · Ft Range Promotion Fees40,000 30,000 30,000 30,000 7016 · Strategic Alliance Fees & Trvl82,221 - Total 7011 · Partnership Fees122,221 30,000 30,000 30,000 Total 7000 · Professional Fees407,221 315,000 315,000 335,000 9000 · Special Event Funding 9000.01 · Pro-Cycling Challenge100,000 - 9000.02 · New Iconic Event Marketing8,500 95,000 70,000 100,000 Total 9000 · Special Events108,500 95,000 70,000 100,000 Total Expense1,940,512 2,341,225 2,341,225 2,571,725 Net Income206,333 (340,025) (140,025) (370,525) Beginning Fund Balance855,363 1,061,696 1,061,696 921,671 Ending Fund Balance1,061,696 721,671 921,671 551,146 %age Fund Balance (25% required)49%36%42%25% 5 1 - 1 - 5 10/16/2012 RESOLUTION NO. 1, SERIES 2012 VAIL LOCAL MARKETING DISTRICT A RESOLUTION ADOPTING A BUDGET AND MAKING APPROPRIATIONS TO PAY THE COSTS, EXPENSES AND LIABILITIES OF THE VAIL LOCAL MARKETING DISTRICT, FOR ITS FISCAL YEAR JANUARY 1, 2013 THROUGH DECEMBER 31, 2013. WHEREAS, the Vail Local Marketing District board received and approved the operating plan and budget for the fiscal year 2013 on September 18, 2012; and WHEREAS, in accordance with CRS section 29-1-106 a notice of budget hearing has been published; and WHEREAS, notice of this public hearing to consider the adoption of the proposed Vail Local Marketing District budget was published in the VAIL DAILY on the 9th day of October, 2012; and NOW THEREFORE, LET IT BE RESOLVED by the Vail Local Marketing District of Vail, Colorado, as follows: The Vail Local Marketing District Board adopts the submitted budget and appropriates $2,571,725 marketing related expenditures beginning on the first day of January, 2013, and ending on the 31st day of December, 2013. Attested: Signed: _______________________________ ___________________________________ Susie Tjossem, Secretary Andrew P. Daly, Chairman 1 - 1 - 6 10/16/2012