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Town Council
Vail Local Marketing District
October 19, 2021
Vail Local Marketing District 2022 Operating Plan and Budget
I.BACKGROUND
The Vail Local Marketing District approved the 2022 Operating Plan and budget at the
September 21st, 2021 Meeting. Since then, staff has made no changes to either the Operating
Plan or the Budget.
Repeated from the Operating Plan meeting on September 21st
The Vail Local Marketing District is responsible for marketing and promoting Vail to attract
overnight destination guests primarily during the non-ski season timeframe, creating economic
vitality by increasing the visitor base, sales tax and lodging tax revenues. Performance against
these goals is measured through data, including occupancy, average daily rate, lodging
and sales tax revenues, especially during lower demand time periods. The VLMD has recently
added a sustainability practices education campaign to protect and enhance our natural assets
by enlightening our guests regarding best practices for sustainability and community values.
II.BUDGET DETAIL
Budgeted revenue from lodging tax collections is proposed at $3,825,000 for 2022. This is a 3%
increase from 2019 actual collections and a 0.7% increase from the 2021 forecast. Year-to-date
revenues are pacing 1.1% ahead of 2019. The assumptions for this projection are conservative
and consistent with the town’s projected sales tax revenue for 2022.
Proposed budgeted expenditures are $4,200,000 for 2022. This is a $565,286 or 15.6%
increase from 2019 actual expenditures and a $295,976 or 7.6% increase from the 2021
amended budget.
Due to better-than-expected lodging tax collections combined with conservative spending the
District’s fund balance increased by $728,702 during 2020. The VLMD is projected to use
$103,024 of reserves during 2021 and is proposing to use another $374,000 of reserves in 2022
to go towards new initiatives. The 2022 ending fund balance is projected to be $1,601,786
which is 43% of revenues and above Council’s directive of 25% of annual revenues.
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III. 2022 OPERATING PLAN & BUDGET
As the Vail Local Marketing District Advisory Council (VLMDAC) looks to the future, and in
service of the VLMD’s overarching business goal, the VLMD’s 2022 strategic approach is
guided by the following Marketing Priorities:
• Optimize Visitation: Target guests that stay longer, spend more and embrace the
destination values, in addition to targeting specific times of the year with an emphasis on
mid-week and shoulder seasons.
• Grow Database and Build the Relationships: Expand our database, use data to
understand our guest, enhance guest engagement and loyalty by optimizing content and
1:1 personalized messaging.
• Destination Stewardship: Protect our natural assets and resources, while elevating the
guest and resident experience through sustainability campaign and dedicated funding.
• Brand Positioning: In accordance with the town council action plan, position Vail as the
Premier International Mountain Resort Community by reinvigorating the Vail brand
through a campaign designed to provoke consumers to feel excited about and intrigued
to visit Vail. Support partners and the community in delivering on the brand promise.
Below outlines 2022 operating plan tactics as they relate to the Marketing Priorities.
Optimize Visitation
VLMD research demonstrates that the highest value guest to the destination generally arrives
by plane from one of the major metropolitan US areas or abroad, stays in Vail lodging for a
longer period of time, and spends more per day than a guest who does not meet this profile.
Loyal guests also tend to return more often, demonstrate similar behavior and are more
invested in the destination than first-time guests. For these reasons the VLMD is targeting the
following guest profile and allocating funding to additional data capture in 2022:
• Longer stay, higher spend, greater personal investment in the destination
– Conduct new in-depth customer interviews to uncover guest experiences
preferences
– Continue meeting with lodges to understand the ideas Vail guest profile
– Increase support of data systems to better understand length and breadth of
consumer journey and signals of intent to purchase
• Lower Demand Time Periods
– Focus on mid-week and shoulder seasons
– Continue group sales efforts to provide room nights during off peak times
– Front Range: reduce media support and drive off peak visitation
– Collaborate with Commission on Special Events to optimize year-round event
calendar
Grow Database and Build the Relationships
• Grow Vail Customer Database
– Create stronger data capture through event partnerships/sponsorships
– Enhance collaboration with lodging, restaurant, retail, TOV (parking) for data
capture
• Use Data to Understand Vail Guest
– Optimize efforts based on message and tactic testing
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– Increase focus on rich, engaging content and 1:1 personalization (web, email,
social) -- Loyalty program
• Enhance Personalization
– Initiate in-resort guest experience enhancements
– Data-driven media plan refinement and implementation
• Reduce media spend with data-informed guest targeting
• Drive destination guest visitation during lower demand time periods
Destination Stewardship
• Dedicated funding for Destination Stewardship Plan Development ($100K)
• Welcome Center Programming
• Ongoing Sustainability Practices Guest Education Campaign
• Tactical Approach to be implemented following adoption of the DSP
Brand Positioning
• Community-generated photography and video program
• In-resort dream experiences
• Customized Dream Trips
• New brand campaign
Major Budget Shifts
The 2022 VLMD Budget totals $4.2 million, a $625,286 increase over 2019. Major shifts in
budget are outlined below:
Strategy/Branding/Research/Photo/Video Fees
• Professional fees increase (from 22% to 49%) due to addition of lodging liaison,
database consultants and additional research.
Creative development, branding and production expenses increase (from 2% to 11%), to
support the 2022 creative which reinvigorates the Vail brand and community and
positions Vail as a leader in the industry.
Database
• Data infrastructure (Systems/Warehousing, Software) increases (from 7% to
14%) to continue database growth and build one on one relationship marketing
efforts.
Drive Overnight Visitation
Funding allocated to driving overnight visitation has been reduced from 71% in 2019 to 37% in
2022, due to a more refined approach to media and targeting high value visitors.
• Reduced funding for Groups (from 17% to 6%) which includes direct sales,
travel/tradeshows, industry memberships, site tour/FAM tours and event recruiting.
Group sales efforts focus positioning Vail for a quick recovery when group and meeting
business rebounds.
• Paid Media has been reduced in Destination markets (from 35% to 20%) and Front
Range markets (from 8% to 5%). Destination digital and traditional media (TV /
streaming) have also been reduced.
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•Increase investment in DiscoverVail.com, e-mail and customer relationship marketing
and social media/influencer efforts (from 4% to 9%). Includes more robust year-round
content, enhanced and monitored functionality, and Paid Search services.
•Reduced allocation to Mexico/International (from 4% to 1%) due to travel restrictions
currently in place. Public relations efforts continue and are prepared to increase using
contingency dollars if/when the conditions warrant.
•Public Relations efforts were reduced (from 2% to 1%) by scaling back media related
travel, community relations, media gifts, PR Newswire distribution and other expenses.
•Addition of Destination Stewardship Plan development (from 0% to 1.5%)
•Contingency line item (from 0% to 2%) to support initiatives that may arise due to
changing public health environment and unforeseen needs.
Summary
The VLMDAC believes the 2022 operating plan represents a positive shift from primarily
focusing on driving visitation through paid media to more selectively targeting a high value
customer. With a reinvigorated brand campaign, Vail is positioned to lead, coming out of the
public health crisis. The emphasis on expanding the database, using data to better understand
our guest, enhancing guest engagement and loyalty by optimizing content and 1:1 personalized
messaging will build a foundation for greater visitation and marketing efficiency.
IV.ACTION REQUESTED OF VAIL LOCAL MARKETING DISTRICT
The Vail Local Marketing District recommends that the Town Council approve Resolution 47,
adopting the 2022 Operating Plan and budget of $4,200,000.
2020 Actual 2021 Budget
2021 Amended
Budget
2021
Forecast
Proposed
2022
Budget
Income
Lodging Tax 3,041,116 2,500,000 3,400,000 3,800,000 3,825,000
Interest Income 272 1,000 1,000 1,000 1,000
Total Income 3,266,707 2,501,000 3,401,000 3,801,000 3,826,000
Expense
Destination 630,331 630,164 963,229 963,229 835,000
International 15,576 10,000 45,000 45,000 56,000
Front Range 180,122 - 458,935 458,935 218,500
Groups and Meetings 504,077 250,000 250,000 250,000 265,000
Public Relations Expenses 48,697 92,000 111,000 111,000 177,000
Content/Influencer Strategy 41,415 50,100 50,100 50,100 88,000
Photography / Video 62,454 93,000 63,000 63,000 240,000
Research 79,872 75,000 75,000 75,000 143,000
Web Site 144,230 220,200 211,018 211,018 213,300
Admin Miscellaneous 3,260 8,000 18,000 18,000 8,000
Email Marketing 5,565 360 20,110 20,110 94,640
Branding 305,158 118,000 674,000 674,000 479,500
Contingency - - 11,532 11,532 130,760
Destination Stewardship Mgmt Plan - - - - 100,000
Database Warehousing and Research 150,925 118,700 464,600 464,600 591,300
In-Market Marketing - - - - 105,000
Professional Fees
Legal and Accounting 25,000 25,000 25,000 25,000 25,000
Lodging Liaison 13,499 - 48,000 48,000 48,000
Advertising Agent Fees 79,125 146,000 203,000 203,000 160,000
Marketing Coordination-TOV 80,500 95,000 95,000 95,000 95,000
Marketing Coordination-VVP 40,000 37,500 37,500 37,500 41,500
Professional Fees - MYPR 102,200 50,000 55,000 55,000 60,500
Total Professional Fees 340,324 353,500 463,500 463,500 430,000
Special Event Funding
Event Liaison 25,000 25,000 25,000 25,000 25,000
Total Special Events 25,000 25,000 25,000 25,000 25,000
Total Expense 2,538,005 2,044,024 3,904,024 3,904,024 4,200,000
Revenue over (Under) Expenditures 728,702 456,976 (503,024) (103,024) (374,000)
Beginning Fund Balance 1,350,108 1,327,713 2,078,810 2,078,810 1,975,786
Ending Fund Balance 2,078,810 1,784,689 1,575,786 1,975,786 1,601,786
Fund Balance (25% required) 58% 50% 42% 52% 43%
VAIL LOCAL MARKETING DISTRICT 2022 PROPOSED BUDGET
SUMMARY OF REVENUE EXPENDITURES AND CHANGES IN FUND BALANCE
Resolution No. 47, Series of 2021
RESOLUTION NO. 47
SERIES OF 2022
A RESOLUTION APPROVING THE OPERATING PLAN AND BUDGET OF
THE VAIL LOCAL MARKETING DISTRICT, FOR ITS FISCAL YEAR
JANUARY 1, 2022 THROUGH DECEMBER 31, 2022
WHEREAS, the Town of Vail (the “Town”), in the County of Eagle and State of
Colorado is a home rule municipal corporation duly organized and existing under the
laws of the State of Colorado and the Town Charter (the “Charter”); and
WHEREAS, the members of the Town Council of the Town (the “Council”) have
been duly elected and qualified; and
WHEREAS, C.R.S. §29-25-110 requires the Council’s annual approval of the
operating plan the Vail Local Marketing District (the “VLMD”).
NOW THEREFORE, BE IT RESOLVED BY THE TOWN COUNCIL OF THE
TOWN OF VAIL, COLORADO THAT:
Section 1. The Council approves the operating plan and budget of the VLMD
for marketing related expenditures beginning on the first day of January, 2022, and
ending on the 31st day of December, 2022.
Section 2. This Resolution shall take effect immediately upon its passage.
INTRODUCED, PASSED AND ADOPTED at a regular meeting of the Town Council of
the Town of Vail held this 19th day of October 2021.
___________________________________
Dave Chapin, Town Mayor
Attested:
_________________________
Scott Robson, Town Manager