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HomeMy WebLinkAbout15. VLMD First Supplemental 12.5.2021 Council Meeting VAIL L O C AL MAR K E T IN G D IS T R IC T ME E TIN G Vail Local Marketing D istrict Agenda Virtual 3:00 P M, January 5, 2021 Meeting to be held Virtually (access H igh Five Access Media livestr eam https://www.highfivemedia.org/live-five the day of the meeting and visit https://www.vailgov.com/town-council to participate in public comment) Notes: Times of items are approximate, subject to change, and cannot be relied upon to determine what time Counc il will consider an item. Public c omment will be taken on eac h agenda item. Citizen participation offers an opportunity for c itizens to express opinions or ask questions regarding town services, polic ies or other matters of community concern, and any items that are not on the agenda. Please attempt to keep c omments to three minutes; time limits established are to provide effic iency in the conduct of the meeting and to allow equal opportunity for everyone wishing to speak. 1.Call to O rder 2.P ublic Hearings 2.1.Resolution No. 1, Series of 2021, A Resolution Amending a Budget and Making Appropriations to P ay the Costs, Expenses and Liabilities of the Vail Local Marketing Distric t, for the Fisc al Year J anuary 1, 2021 Through December 31, 2021. 10 min. Presenter(s): Mia Vlaar, Ec onomic Development Director; Carlie Smith, Financial Services Manager Action Requested of Counc il: A pprove or approve with amendments Resolution No. 1, Series of 2021 Bac kground: Please see attached memo. Staff Rec ommendation: Approve or approve with amendments Resolution No. 1, Series of 2021 3.Adjournment 3.1.Adjournment 3:10 pm (estimate) Meeting agendas and materials c an be ac cessed prior to meeting day on the Town of Vail website www.vailgov.com. All town council meetings will be streamed live by High Five Ac cess Media and available for public viewing as the meeting is happening. The meeting videos are also posted to High Five Ac cess Media website the week following meeting day, www.highfivemedia.org. January 5, 2021 - Page 1 of 8 Please call 970-479-2136 for additional information. Sign language interpretation is available upon request with 48 hour notification dial 711. January 5, 2021 - Page 2 of 8 VA I L TO W N C O UNC I L A G E ND A ME MO I T E M /T O P I C : Resolution No. 1, S eries of 2021, A R esolution A mending a B udget and Making A ppropriations to Pay the Costs, Expenses and L iabilities of the Vail L ocal Marketing D istrict, for the F iscal Year J anuary 1, 2021 Through D ecember 31, 2021. P RE S E NT E R(S ): Mia V laar, Economic D evelopment Director; C arlie S mith, F inancial Services Manager AC T IO N RE Q UE S T E D O F C O UNC IL : A pprove or approve with amendments R esolution No. 1, Series of 2021 B AC K G RO UND: Please see attached memo. S TAF F RE C O M M E ND AT I O N: Approve or approve with amendments R esolution No. 1, S eries of 2021 AT TAC H ME N TS : Description Resolution No.1, Series of 2021 V L MD 1st S upplemental January 5, 2021 - Page 3 of 8 To: Vail Local Marketing District From: Vail Local Marketing District Advisory Council Date: January 5, 2021 Subject: Vail Local Marketing District 1st Supplemental Budget Request I. BACKGROUND The mission of the Vail Local Marketing District (VLMD) is to market and promote Vail to attract overnight destination guests primarily during the May to October time frame, creating economic vitality by increasing the visitor base, sales tax and lodging tax revenues. The overarching goal of the VLMD is to strengthen Vail’s position as a year- round mountain resort destination that appeals to a broad audience by elevating the summer brand position. With the addition of the DiscoverVail.com website, the VLMD is now in a position to promote non-ski season travel to Vail during the winter months. The goal is to better understand high-funnel consumer interest and performance: • Consumer demand for summer travel during the winter season (i.e., search volume, etc.) • Summer versus winter key metric performance (i.e. click-thru rate and cost per click, etc.) • Understand high-performing and click driving, non-branded summer terms Based on this new opportunity Cactus evaluated multiple digital media options to understand what a monthly paid media investment could look like during the winter months to continue to drive summer and shoulder season tourism. BUDGET DETAIL The Vail Local Marketing District Advisory Council (VLMDAC) is recommending a supplemental of $140,000 to be used for pay per click (PPC) search. This will include: • Five months of non-branded summer vacation terms (i.e. summer mountain vacation, summer weekend getaway, mountain resort hiking, etc.) • A monthly spend level which is comparable to past VLMD summer PPC budgets and is only charged when a listing is clicked on by consumers January 5, 2021 - Page 4 of 8 Town of Vail Page 2 • Non-branded paid search terms only to ensure no competition with Vail Resorts — specifically to navigate away from branded and winter-related search terms that are aimed at driving users to vail.com The additional $140,000 of PPC spend will be allocated between the Front Range ($115,000) and to three (to be determined) destination markets ($25,000) that can be flexible with changing travel conditions (i.e. COVID-19). The 2021 amended fund balance is projected to be $1,644,689, or 46% of a normal year’s annual revenues (above Council’s 25% directive). II. BUDGET RECLASSIFICATIONS Since presenting the budget in October, the VLMD determined several line items needed to be re-classified to more accurately reflect how and where the funds are being spent. These shifts do not reflect a shift in strategy or tactics, but, rather a more accurate representation of the true nature of the expense. Through this process, the following budget shifts have occurred: • Digital media advertising efforts were classified under one line item totaling $577,164, and have since been reclassified to separate Destination Digital Media vs. Front Range Digital Media as outlined below: Destination Digital Media $184,692 Front Range Digital Media $392,472 • An amount of $30,000 was re-classified from Photo/Video production into Branding and Production, to reflect this amount as being hard costs and expenses vs. fees. In addition, $5,000 was re-classified from SITE Marketing email line item into Production to accurate reflect how those dollars are spent.Re-classification from Website into the Database Systems line items resulted in $172,000 shifting from Website into Database Systems to accurately reflect what was specific to website enhancement and development vs. overall data systems enhancements and expenses. • A $48,000 re-classification from Destination to Professional Fees was made to accurately reflect the roll of the Lodging Liaison. III. ACTION REQUESTED OF VAIL LOCAL MARKETING DISTRICT The Vail Local Marketing District Advisory Council recommends that the Vail Local Marketing District approve the supplemental PPC media budget of $140,000. January 5, 2021 - Page 5 of 8 2020 Amended Budget Presented 2021 Budget 1st Supplemental 1st Supplemental Budget Shifts 2021 Amended Budget Income Lodging Tax 2,390,840 2,500,000 2,500,000 PY Lodging Tax 208,765 - - Interest Income 2,000 1,000 1,000 Total Income 2,601,605 2,501,000 - - 2,501,000 Expense Destination 436,322 630,164 25,000 (445,472) 209,692 International 15,668 10,000 10,000 Front Range 445,087 - 115,000 392,472 507,472 Groups and Meetings 524,590 250,000 250,000 Public Relations Expenses 72,950 92,000 92,000 Content/Influencer Strategy 44,250 50,100 50,100 Photography / Video 37,000 93,000 (30,000) 63,000 Research 75,000 75,000 75,000 Web Site 143,510 220,200 (172,000) 48,200 Admin Miscellaneous 8,000 8,000 8,000 Email Marketing - 360 360 Branding 312,309 118,000 35,000 153,000 Database Warehousing and Research 145,490 118,700 172,000 290,700 Professional Fees Vail App 5,499 - - Legal and Accounting 25,000 25,000 25,000 Lodging Liaison - - 48,000 48,000 Advertising Agent Fees 85,625 146,000 146,000 Marketing Coordination-TOV 80,500 95,000 95,000 Marketing Coordination-VVP 40,000 37,500 37,500 Professional Fees - MYPR 102,200 50,000 50,000 Total Professional Fees 338,824 353,500 - 48,000 401,500 Special Event Funding Event Liaison 25,000 25,000 25,000 Total Special Events 25,000 25,000 - - 25,000 Total Expense 2,624,000 2,044,024 140,000 - 2,184,024 Revenue over (Under) Expenditures (22,395) 456,976 (140,000) - 316,976 Beginning Fund Balance 1,350,108 1,327,713 1,327,713 Ending Fund Balance 1,327,713 1,784,689 1,644,689 Fund Balance (25% required) 36% 50% 46% VAIL LOCAL MARKETING DISTRICT 2021 PROPOSED AMENDED BUDGET SUMMARY OF REVENUE EXPENDITURES AND CHANGES IN FUND BALANCE January 5, 2021 - Page 6 of 8 RESOLUTION NO.1, SERIES 2021 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, 2021 THROUGH DECEMBER 31, 2021. WHEREAS, the Vail Local Marketing District board received and approved the operating plan and budget for the fiscal year 2021 on September 15, 2020; 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 29th day of December, 2020; 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 $2,184,024 marketing related expenditures beginning on the first day of January, 2021, and ending on the 31st day of December, 2021. Attested: Signed: _______________________________ ___________________________________ Jenn Bruno, Secretary Dave Chapin, Chairman January 5, 2021 - Page 7 of 8 VA I L TO W N C O UNC I L A G E ND A ME MO I T E M /T O P I C : Adjournment 3:10 pm (estimate) January 5, 2021 - Page 8 of 8