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Home My WebLink About02/06/1996, C-4 - USE OF PROMOTIONAL COORDINATING COMMITTEE (PCC) ENHANCED PROMOTIONAL FUNDS MEETING DATE: city of San LUIS OBISPO A-6-5(v Nii% COUNCIL AGENDA REPORT rrEM NUMBER: - FROM: Ken Hampian, Assistant CAO Or Prepared by: Wendy George, Assistant to the CAO 010 SUBJECT: Use of Promotional Coordinating Committee (PCC) Enhanced Promotional Funds CAO RECOMMENDATION: 1) Approve the PCCs recommendation to spend $10,080 of Enhanced Promotional Funds to upgrade "fulfillment" materials by including the Chamber of Commerce visitors' guide magazine and 2) authorize the Mayor to sign an amendment to the Barnett Cox & Kornreich contract. DISCUSSION: Background Respondents to the City's tourism advertising currently receive a "fulfillment" package consisting of a visitor brochure, an accommodations list and a rack card for the Edna Valley vintners. These materials are mailed in the Chamber of Commerce standard business envelope using first class postage. Materials are mailed within ten days of the request. Cost of materials design, and printing are paid through the City's advertising contract with Barnett, Cox & Kornreich (BC&K). Cost of preparing the materials for mailing, the envelope and postage are paid for through the Chamber's contract with the City. Visitor response materials offer the City an excellent opportunity to entice prospective visitors to visit San Luis Obispo. Many of the callers to the 800 number are potential first time tourists seeking information. There is tremendous competition with other communities interested in the same visitor market, such as Santa Barbara, which send out much more attractive and persuasive materials at no charge. The PCC has long felt that it is important to upgrade San Luis Obispo's "fulfillment" materials, which is why it recently approved adding the rack card for the Edna Valley vintners. Proposal At its January 10, 1996, meeting, the PCC received a proposal from Maggie Cox of BC&K that the "fulfillment" package be upgraded by including the full color visitors' guide magazine printed by the Chamber of Commerce. The magazine is of excellent quality and it would be beyond the limitations of the City's advertising budget to produce anything comparable to use in the package. Addition of this magazine would greatly improve the package both visually and in the provision of useful information and would place us in a highly competitive position relative to the advertising of other coastal communities. Print advertising would be placed in newspapers and magazines highlighting the value of the material which could be received by calling the 800 phone number. ►��bH��lll{III�p� q�Ulll City Of San L.JS OBISPO COUNCIL AGENDA REPORT The proposal recommends that an additional 2,800 copies of the magazine be printed by the Chamber of Commerce as part of their normal printing run. By cooperating with the Chamber on the printing run, the City would avoid the additional costs created with a second printing run. In 1994-95 the City received 2,833 inquiries for information on its 800 automated phone line. It also received 1,407 responses via mail labels from travel bazaar ads which ran in LA Magazine. Because BC&K believes that callers to the 800 number are more likely to visit San Luis Obispo, they will be focusing their efforts on these callers. Therefore,the 2,800 copies of the magazine should be sufficient to respond to approximately a year's worth of phone calls on the 800 line. Other inquiries will be filled using the old "fulfillment" materials of the brochure, hotel list and winery guide. Other Issues Related to the Proposal Maggie Cox of BC&K pointed out that the magazine promotes some businesses which are not located within the City, and excludes 5 out of 33.motels which are within the City limits. To remedy this problem, she suggested including a cover letter with the packet which would welcome visitors to San Luis Obispo and encourage them to make the City the hub of a central coast vacation. It would also offer visitors the opportunity to receive a free City poster from the Chamber of Commerce if they stay at one of the hotels/motels on the list of San Luis Obispo D�V accommodations which is also enclosed in the packet. The Chamber of Commerce did an analysis of the advertisements, photographs and editorial inches in the magazine devoted to the City and found them to make up the majority of the magazine. A copy of that analysis is attached. In addition, this proposal constitutes a trial run, and, if successful, would likely lead to the PCC recommending a similar annual expenditure in the City's advertising budget. While the money is available this year in the Enhanced Promotional Fund budget, an on-going source has not been identified. One approach to funding such an on-going cost, without increasing the overall promotional budget, would be to reduce the annual Enhanced Promotional Fund allocation from $50,000 to $40,000. The best solution can be determined after the results of this pilot program are analyzed. Agreement The attached amendment to the agreement with Barnett Cox & Kornreich adds the additional $10,080 to provide the Chamber of Commerce magazine to the fulfillment package. It also adds to the agreement funds previously approved by Council for a video brochure and additional print advertising in the San Jose area. FISCAL IMPACT: The unit cost per magazine, including postage and a plastic mailer is $3.60. To print and mail 2,800 magazines would cost a total of$10,080. There is currently a balance of$12,000 C'-ZIQ ��H��N►�Illllp�p°Scitycityor►��U San _.pis ogospo ii M NMICO`JNCIL AGENDA SPORT in the Enhanced Promotional Fund established as part of the .1995-96 Financial Plan (pg. D-.117) Attachments: Attachment 1 = Agreement Attachment 2 Proposal from BC&K Attachment 3 Analysis from Chamber of Commerce Samples of photographs and materials from the magazine Council only a •3 AMENDMENT NO. 1 AGREEMENT WITH BARNETT, COX AND ASSOCIATES, INC. (D.B.A. BARNETT, COX AND KORNREICH) The AGREEMENT dated July 20, 1995 between the CITY OF SAN LUIS OBISPO, a municipal corporation, hereinafter referred to as "City" and BARNETT, COX AND ASSOCIATIONS, INC. (D.B.A. BARNETT, COX AND KORNREICH), hereinafter referred to as "Contractor", is hereby amended to follows: EXHIBIT "Al', Scope of Work, Section 4 is modified as follows: 8. A five minute long Video Brochure will be produced for use in showcasing the City to travel writers, feature writers, electronic news media, etc. 9. Additional print advertising will be provided, notably in the San Jose Market. 10. The fulfillment package will be upgraded to include the Chamber of Commerce visitors' guide magazine. SECTION 4, "City's Obligations" is modified as follows: 1995-96 ■ Video Brochure $ 7,000 ■ Additional Advertising $ 6,000 ■ Upgrade Fulfillment Package $10,080 All other terms and conditions of the AGREEMENT remain the same. Both CITY and CONTRACTOR do covenant that each individual executing this addendum on behalf of each party is a person duly authorized and empowered to execute Agreements for such part. IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed on this day of February, 1996. ATTEST: CITY OF SAN LUIS OBISPO A Municipal Corporation City Clerk Allen Settle, Mayor Amendment No. 1 Page 2 APPROVED. AS TO FORM: CONTRACTOR f Jogifr,fity Attorney Maggie Cox, President Enhanced Promotional Funds: Remaining Balance Proposal Background: • Respondents to the City's tourism advertising currently receive a visitor brochure, an accommodations list and, soon, a rack card for the Edna Valley vintners. • These materials are mailed in a Chamber of Commerce, standard size business envelope. • Visitor response packets are mailed at a first class rate within ten days of receipt of original request. • Cost of materials' design and printing are paid for through advertising contract; Cost of request fulfillment, envelope and postage are paid for through Chamber visitor center contract. Opportunity: • Visitor response materials offer us a unique opportunity to sell prospective visitor on visiting SLO. • It is likely that many callers to 800 number have not visited SLO and are seeking first time information. • There is tremendous competition with other communities interested in same visitor market as is SLO,with cities like Santa Barbara sending much more persuasive materials at no charge. • This proposal is forwarded with the intention of making SLO more competitive and move ad respondents to decide to come to SLO. Proposal. • For fiscal year 1995-96, utilize $10,000 of unallocated enhancement funds to improve fulfillment materials. • Upgrade fulfillment package for a maximum of 3,000 respondents to include following: 1. Chamber full color visitors guide magazine 2. Cover letter of welcome and invitation to stay in SLO --offer of poster upon showing of SLO accommodations' receipt. 3. Existing brochure and accommodations list 4. Edna Valley wineries rack card S. Mailed first class in clear plastic envelope /! / A+lachmen4- 2 Pros. • Vastly improved sales piece (both visually appealing and useful information) • Given budget limitations, City of SLO would otherwise be unable to produce publication of this quality and value. • Timing is right to maximize print efficiency with Chamber(just heading to press) • Chamber willing to contribute cost of additional fulfillment time. Cons. • Expensive postage • Promotes businesses not necessarily in SLO. Excludes some businesses (notably a few motels) in SLO. Reconcile this problem by including a cover letter with packet. Letter would welcome visitors to SLO and encourage them to make SLO hub of a fabulous central coast vacation. Stay in a SLO hotel/motel on the enclosed list and bring your room receipt to the Chamber for a free city poster. Rationale of in support of proposal: • Value of visitor packet materials outweighs the issue of outside city businesses being in guide. • Insert letter should appease TOT payers. • Packet would make us more competitive with communities like Santa Barbara and lead to increased TOT. Costs: Guide per unit $1.34 (retails $2.95) Postage per packet $2.16 Plastic mailer .10 Total: $3.60 per packet (x-1,00&units=$10,800) A.Note: Due to timing constraints, this proposal has not been reviewed by the PCC Marketing Subcommittee. pcc2:guide.doc The San Luis Obispo Chamber of Commerce Visitors Guide is written to draw visitors to San Luis Obispo and to help them make the most of their vacations to San Luis Obispo. Most of the editorial coverage,advertising and photographs are of attractions and businesses located in San Luis Obispo city proper. However,we recognize that we do not exist in a vacuum. Visitors travel here not only to enjoy attractions and businesses inside the city limits,but to venture out into the county to experience all we have to offer. Therefore, the San Luis Obispo Visitors Guide touches on attractions in the city's fringe area as well as other areas of the county. Case in point,Hearst Castle. An entire page of the Guide is dedicated to the Castle which is marketed as a pleasant day trip from San Luis Obispo. Advertising: 86 of the advertisements are by businesses and attractions within San Luis Obispo city limits,5 are in the fringe areas (i.e. Cal Poly,Tank Farm Road.,etc.) and just 29 are by businesses outside the city limits. The advertisers pay for a majority of the cost of this publication. Photographs:Photographs depict San Luis Obispo as a vacation experience and include photos inside city limits and in other areas of the county. However,please note that photographs taken in other cities do not necessarily identify those cities (there are no photos of city signs or city banners for areas outside San Luis Obispo city proper). All totaled,29 of the photographs in the editorial portion of the guide were taken inside the San Luis Obispo city limits,8 in the city's fringe areas and 17 were taken in other areas of the county. Most out-of-city photographs are scenics which help sell the overall San Luis Obispo experience. Editorial: More than 1,180 inches of the Visitors Guide are about San Luis Obispo- specific attractions and businesses and another 45 inches are about the fringe area. Some 630 inches are dedicated to other areas in the county including one full page featuring Hearst Castle (again,marketed as a pleasant day trip from San Luis Obispo). These measurements do not include the recreation listings nor the special events listings which include several attractions both inside and outside the city limits. These are included to broaden the visitors' entertainment opportunities while staying in San Luis Obispo. San Luis Obispo Visitors Guide coverage breakdown San Luis Obispo San Luis Obispo County city proper fringe area Advertisments 86 5 29 Photographs 29 8 17 Editorial inches 1180 + 45 + 630 + A4a&kmen+ 3 L?- D