Loading...
HomeMy WebLinkAbout06/19/1990, 9 - CONSIDERATION OF RECOMMENDATIONS FROM THE PROMOTIONAL COORDINATING COMMITTEE FOR THE CITY'S 1990-91 cI of LUIS OBISO MEETING DATE:G�990A REM NUMBER: COUNCIL AGENDA REPORT FROM: Ren Hampian, Assistant City Administrative Office Prepared By: Deb Hossli, Administrative Analyst �,hp ,�j SUBJECT: Consideration of Recommendations from the Promotional Coordinating Committee for the City's 1990-91 Promotional Program CAO RECOMMENDATIONS: 1. Consider recommendations from the Promotional Coordinating Committee and determine appropriate funding levels for the Cityls 1990-91 Promotional Program. 2. Authorize the City Administrative Officer to execute contracts with the Chamber of Commerce, San Luis Obispo County Visitors and Conference Bureau and SJ Francis and Associates for promotional and advertising services after action has been taken on funding levels for each contract. REPORT-IN-BRIEF The City currently holds four, one year contracts for promotional and advertising services. The Chamber of Commerce holds two of these contracts; one contract is for visitor services and the other is for promotional services. A third contract is held by the San Luis Obispo County Visitors and Conference Bureau (VCB) and represents the City"s contribution toward the marketing of the entire central coast as a tourist destination. The final contract, held by SJ Francis and Associates is for advertising services. All the contracts are for one year in length and funded with monies from the Community Promotional budget. The Promotional Coordinating Committee (PCC) reviews the contracts in May of each year and provides the City Council with recommendations for funding levels. These recommendations are then presented to the City Council in June for action. Once the City Council acts on the funding levels and the contracts are approved, the PCC is responsible for monitoring contract implementation throughout the year. The PCC .has completed its review of the City's promotional and advertising contracts. The PCC is recommending to the Council that the Chamber of Commerce receive a total of $77,020 for visitor and promotional services, the San Luis Obispo County Visitors and Conference Bureau receive $46,000 for promotional services and SJ Francis and Associates receive $80,850 for advertising services. In summary, the PCC is recommending that the Council allocate $203,870 for the City"s 1990-91 Promotional Program. This represents a 12.5% increase over the prior year funding level. �- r MY of san lues osispo COUNCIL AGENDA REPORT Council Agenda Report Page Two DISCUSSION Review Process The PCC established a Subcommittee composed of Pati Brown, Dan Pittaway, and Jesse Norris to perform a detailed review of the City's advertising and promotional contracts and provide suggestions for improving the 1990-91 selection process. In conducting their review, the Subcommittee acknowledged that they were generally satisfied with the performance of the current contractors and therefore only recommended minor modifications to the selection process. Their recommendations were subsequently presented to the full PCC and unanimously approved. As a result of this approval, staff was directed to prepare letters to the Chamber of Commerce and VCB requesting proposals for one- year extensions of services. The City has typically negotiated directly with the Chamber of Commerce and VCB for their services. It is generally felt that both organizations offer unique services and are best suited to provide promotional and visitor services. With respect to the advertising contract, staff was directed to prepare a Request for Proposal (RFP) to solicit for advertising services. The City has typically used the RFP approach for selecting the. advertising contractor. Because there are several qualified advertising and public relations firms in the community, a competitive proposal process insures that all interested firms have an opportunity to bid on the contract. SJ Francis and Associates has held this contract -for the past three years. Proposals Received and PCC Recommendations The PCC received proposals from the Chamber of Commerce, the VCB, and SJ Francis and Associates for promotional and advertising services. The proposals totaled $208,970, which represents a 15% increase over prior year funding levels. The PCC held a public hearing on May 21, 1990 to discuss the promotional and advertising proposals submitted. After considering information provided by staff and presentations from the proposers, the PCC finalized their recommendations and requested staff to transmit the recommendations to the City Council. The PCC is recommending that the Council allocate a total of $203,870 for 1990-91 promotional and advertising contracts. This represents a 12.5% increase over 1989-90 funding levels. The following represents a summary of the proposals received and the actions recommended by the PCC: �r Z IIP°Nu'911 city of San tuts OBISPO i9 COUNCIL AGENDA REPORT Council Agenda Report Page Three 1. Chamber of Commerce Visitors Services Contract - Under the Visitor Services contract, the Chamber of Commerce provides a full-service Visitors center that is open to the public seven days a week. The center responds to visitors inquiries; distributes maps and promotional literature; and maintains information on economic data, recreational facilities, and cultural events taking place in the City of San Luis Obispo. The Chamber of Commerce has submitted a proposal for 1990-91 visitors services which will maintain the same basic services for one additional year (See attachment "111) . Requested funding of $48,230 represents a 6% increase over the 1989-90 contract level. The additional monies are requested to offset rising cost of living and postage expenses. At the requested funding level, the cost sharing ratio for the Visitors Center will be maintained (33% from the Chamber of Commerce, 33$ from the City, and 33% from sales in the Visitors Center) . The PCC is recommending that the Chamber of Commerce Visitor Services contract be funded at their requested level of $48,230. It is the PCC's opinion that the Chamber of Commerce continues to provide valuable services to the City and their justification for additional monies is reasonable (rising labor and postage costs) . Promotional Contract - Under the Promotional Contract, the Chamber of Commerce provides promotional services for the City. This includes such activities as preparing and disseminating press releases and promotional information that encourages travel to San Luis Obispo. The Chamber of Commerce has submitted a proposal for the 1990- 91 Promotional Contract that also maintains the same overall services for one additional year (See attachment "1") . Requested funding of $28,090 represents a 6% increase over the 1989-90 contract level. The additional monies are requested to offset rising cost of living expenses. The PCC is recommending that the Chamber of Commerce"s Promotional Contract be funded at the requested level of $28,090: It is the PCC's opinion that the Chamber of Commerce continues to provide valuable services to the City and their justification for additional monies is reasonable (rising labor costs) . City Of San tuts OBISp0 COUNCIL AGENDA REPORT Council Agenda Report Page Four Tourist Water Awareness Pro am - The Chamber of Commerce is requesting $5,800 to continue . the Tourist Water Awareness Program through 1990-91 (See attachment "1") . The City Council approved a joint program with the Chamber of Commerce that encourages tourists to conserve water while visiting San Luis Obispo. Under this joint program, the City. agreed to fund the costs of the materials (a.g. , tent cards, flyers, and stickers) and the Chamber of Commerce agreed to design the materials and provide promotional services needed to implement the program.•' The City Council allocated funding to cover a. four month period, with the understanding that the Chamber would request funding to continue the program during the 1990- 91 promotional contract review process. The $5,800 is primarily needed to purchase enough materials to last for the remainder of 1990-91. The PCC is recommending that the Chamber of Commerce receive $700 for the Tourist Water Awareness Program. The $700 would be used for any needed design changes to the materials that may arise during the year and promotional efforts. The Utilities Director has offered to fund the balance of the request, .$5,100. for materials and supplies, through the Water Conservation budget. This arrangement is acceptable to the Chamber of Commerce. 2. San Luis Obispo County Visitors and Conference Bureau Under the VCB,s contract, ,the City"s annual contribution represents our share of the effort to market the central coast as a tourist destination. The VCB's services focus on promoting the entire county and include advertising and promotion, participation in trade shows, brochure development and distribution, publicity, market research, assistance with group and conference planning, and film production development. The VCB,s funding is derived from requests for annual contributions from the county and each city. The City has provided funding to the VCB since 1987-88. The VCB has submitted a .proposal for 1990-91 (See attachment 11211) that provides for a continuation of the same overall services as the prior year. Emphasis will be placed, however, on increasing advertising, trade show participation, and publicity. The VCB will also concentrate its efforts on increasing film production and group travel in the county. Requested funding of $46,000 represents a 29% increase over 1989-90 funding levels. As has been the past practice, the request , is based on 3.5% of the transient lodging tax collected two years prior to the year that funding is being 9-� 411111111I► 1111111 city or san lues osispo COUNCIL AGENDA REPORT Council Agenda Report Page Five requested for. However, because only a 5% increase was provided in the 1989-90 contract and the transient lodging tax has continued. to increase at a consistent pace over the last several years, the VCB's request represents a significant percentage increase in funding. It is important to note that while VCB requests have been tied to a percentage of the transient tax, actual appropriations by the City have not. Further comment on this is provided under the "Concurrence" portion of the report. The PCC is recommending that the VCB be funded at their requested level of $46,000. The PCC felt that the Justifications provided by the VCB for the requested contract increases were reasonable (rising advertising expenses, the need for Film Commission monies, etc. ) and that the success of the VCB could be measured by the consistent increases in the transient lodging taxes. 3. Advertising Contract The City distributed RFP's to thirteen public relations and advertising firms in the county. Announcements were also placed in the Telegram-Tribune advertising the availability of the RFPs. As was the case in 1989-90, the City only received one proposal responding to the RFP. The proposal received was from SJ Francis and Associates who has held the contract for the last three years. Ms. Francis is proposing the same overall advertising campaign as 1989-90. Based on the success of the "Share it with Someone Special Campaign", Ms. Francis is proposing that it be continued into 1990-91. In addition, all advertising and visitor information literature developed as part of the this contract will contain the City's water conservation message. The proposal also includes a recommendation to consider allocating funding for market research activities. By developing market research data, the City would be better insured that its advertising monies are well spent. (Funding for market research has not been included in the proposal for services. Ms. Francis recommends that $20,000 be added to the contract if the Council is interested in pursuing market research activities.) Requested funding of $80,850 represents a 10% increase over 1989-90 funding levels. The additional monies have been requested to offset the rising costs of advertising expenses, which have increased a minimum of 10% over the last year. �u��i �►�illli�P ��IU city of san Luis oBispo COUNCIL AGENDA REPORT Council Agenda Report Page Six The PCC is recommending that SJ Francis and Associates be funded at the requested level of $80,850. The PCC felt that based on their satisfaction with Ms. Francis' past services, the fact that advertising expenses have increased a minimum of 10%, and that City has continued to see increases in transient lodging taxes, the requested increase in funding was justified. The PCC is not recommending funding at this time for market research activities. It is the PCC's intention to further evaluate the need for market research before taking any action. Please note that attachment "4" provides a financial summary for each the PCC.'s promotional and advertising contracts which shows adopted 1989-90 funding, budgeted 1990-91 funding, requested 1990- 91 funding, and PCC recommended 1990-91 funding. CONCURRENCES The Finance Director and Utilities Director have reviewed and approved this report. The Finance Director would like to emphasize, however,- that with respect to the VCB, contract, the City has not provided funding for the past two years at the formula set by the VCB (3.5% of the transient lodging taxes collected two years prior). The Finance Director would recommend that the VCB's funding request be evaluated annually based on the merits of their proposal, and not tied to any established formula. FISCAL IMPACT The City's promotional and advertising contracts are funded through the Community Promotional budget. Funding levels for this budget are set by a Council approved formula developed in 1970. Based on this formula, 20% of the transient lodging taxes, 2% of the sales tax, and 15% of the general business taxes are allocated to the Community Promotional budget. Based on goals established by the PCC, funding from the Community Promotional budget is allocated to carry out the City's Promotional Program. Any remaining balance is added to the Promotional Facilities Reserve. Using this formula, the City has budgeted $507,500 for the 1990- 91 Community Promotion budget. Of the $507,500 budgeted, $186,700 has been set aside for 1990-91 promotional and advertising services (which represents a 3% increase over prior years funding levels) . If the Council concurs with the PCC's recommendations for promotional and advertising contract funding, it will be necessary to appropriate an additional $17,170 as part of the adoption of the 1990-91 Budget. 9-G 1. 101 itIq Ig l; city of sap-�JIS OBISpo COUNCIL AGENDA REPORT Council Agenda Report Page Seven. ALTERNATIVES 1. Revise revenue projections for the Community Promotions budget and provide funding at the PCC's recommended levels Under this approach, the revenue projections for the Community Promotions budget would be updated and any additional monies identified in this process would be used to fund the contractors at the PCC's recommended levels. As discussed earlier, funding for the Community Promotions budget is based on a formula and projected for each year of the two year budget. If the actual revenue for the Community Promotions budget is greater than the budgeted revenue, the balance is added to the Promotional Facilities Reserve. Staff has reviewed the revenue projections for the 1989-90 Community Promotions budget. It appears that there will be a net gain of approximately $18,000 more in revenue generated than initially projected for 1989-90. While the City has received lower than projected levels of sales tax revenues, it has received higher than projected levels of transient lodging tax and general business tax revenues, creating the $18,000• overage. Under normal circumstances, the additional .$18,000 would be added to the Promotional Facilities Reserve. .Should the Council select this option, the $18,000 favorable variance in revenue is sufficient to cover the $17,170 shortfall for the 1990-91 promotional and advertising contracts. 21 Fund promotional and advertising contracts within budgeted levels. Under this alternative, each contractor would only receive a 3% increase as provided for in the 1990-91 budget. If the Council chooses to take this approach: 1.. The Chamber of Commerce would receive a combined total of $74,200 in overall funding from the City, or $2,820 less than the PCC recommendation, for the Visitor Services Contract, the Promotional Contract, and the Tourist Water Conservation Program Contract. As a result of this loss of funding, the Chamber of Commerce would only being able to answer visitor inquiries for a ten month period as opposed to twelve . months due to .insufficient monies for postage. In addition, while the Tourist Water Awareness Program would continue because the City is providing the funding for materials, the Chamber of Commerce would not be in the position to fully promote the program. �7 ^� �III�fI �Nu►VIII MY Of San LUIS OBISPO NONGN COUNCIL AGENDA REPORT Council Agenda Report Page Eight 2. The VCB would receive a total of $36,800 in funding from the City, or $9,200 less than the PCC recommendation. As result of this loss of funding, reductions would be seen in advertising and trade show activities. In addition, the VCB would only print a one year supply, as opposed to a three-year supply, of the "Jewel. of the Central Coast" brochures. 3. SJ Francis and Associates would receive a total of $75,700 from the City, or $5,150 less than the PCC recommendation. As a result of the loss of funding, Ms. Francis would reduce the firm's advertising budget by the $5,150 or 10%. This represents the loss of one to two advertisements in major travel magazines. ATTACHMENTS * "1" - Chamber of Commerce Proposal * "2" - VCB Proposal * 113" - SJ Francis and Associates Proposal * "4" - Funding Summary * 05" - Letter from SJ Francis and Associates • SAN LUIS OBISPO CHAMBER OF COMMERCE PROPOSALS FOR 1990-91 FISCAL YEAR The Chamber lost moneythis year for the second year in a row. Since neither our Board nor our reserves can handle any additional losses, staff is under clear direction from the Board to price contracts at a. breax-even point. VISITORS: CONTRACT The Chamber proposes retaining the present program with the addition of a small increase to cover rising labor and postage costs. The largest single cost in maintaining our Visitors Center 7 days a week is labor. Not only have social security, payroll taxes, and health insurance costs increased significantly in the last year, but we must provide, at the minimum, cost-of=living increases in salaries if wish to keep knowledgable and competent staff on board. In addition, even with modest increases in ad responses and other requests for information, we have been paying much more this year for postage. In April of 1989, we began paying an additional 3 cents per response. By next February postal rates are expected to increase an additional 5 cents per response. In order to meet our ongoing commitment to serving visitors and meet the above cost increases, the Chamber is proposing a 6 percent increase in the existing Visitors Center contract. The additional $2,730 would bring the contract total to $48,230. PROMOTIONAL CONTRACT Our promotional program has been so successful this past year, we recommend keeping it basically the same. However here again, as with the Visitors Center contract, with are faced with the increasingly difficult task of breaking even amid rising postage, labor .and rent costs. In addition, the Chamber has added a part-time support person who will assist with many of the routine clerical duties associated with the promotional contract such as running media lists, stuffing envelopes. This will enable our Communications Director to spend more time making personal media contacts, setting up press tours etc. While the City will benefit greatly from this additional help, the cost , is being borne entirely by the Chamber. However, keeping these additional benefits in mind and taking in consideration increasing costs, the Chamber is also asking for a 6% increase to maintain the current promotional program. This ATTACHMENT 1 . 9- 9 will require an additional $1,590 and bring the total contract to $28,090. TOURISM WATER AWARENESS The Chamber would like to treat this program separately from the the regular Promotional Contract because the two programs are so different. The current proposal on Tourist Water Awareness Campaign was designed to provide enough materials (flyers, tent cards and stickers) to hotels/motels and restaurants to last for 3-4 months. -To maintain this program at its current level and provide enough conservation materials for the entire year, we will need an additional $5,800. We feel very strongly that theCity Council will want continue its support of this crit-ically yimportant program. i q-iv San Luis Obispo County Visitors & Conference Bureau May 3, 1990 Mr. R. Jackson Gatz Promotional Coordinating Chairman City of San Luis Obispo 990 Palm St. San Luis Obispo, CA 93401 Dear Jack: Attached is the proposal for tourism promotion from the San Luis Obispo County Visitors & Conference Bureau for fiscal year • 1990/91. As you know, the VCB, bases its -request on 3.5% of the transient occupancy tax collected two years prior to the year being funded. This year we are requesting $46,000. As you will see in the proposal, the VCB has grown tremendously. As our promotion efforts have .been refined and increased, our budget has remained approximately pp ly the same over the years. We have built our marketing programs to include more advertising, trade shows and publicity. The results of which can be seen in a 14$ increase in the transient occupancy tax collected in the city. This year the VCB_ is faced with increased costs-of-doing- business ranging from 10% to 25% depending on the programs. In addition, the VCB must reproduce its single most important promotional tool, the "Jewel .of the. Central Coast" brochure which costs $30, 000 for a three year supply. If the City of San Luis Obispo decides to fund the bureau at a level less than requested, we will only be able to reproduce one-year's supply, which increases the cost per unit. We have many challenges ahead of us and I look forward to working together to further stimulate the number one economy of San Luis Obispo. Vni y Eyla e. Dir c or ATTACHMENT 2 t N 1 i L:n; Snrri. Vii!r C. in Lui; l�hi;pa. G�liicmia 93 fUl (805) 5i1-RX)() ��� San Luis Obispo County Visitors 6 Conference Bureau 1990/91 TOURISM PROMOTION PROPOSAL SCOPE OF SERVICES The San Luis Obispo County Visitors & Conference Bureau (VCB) plans and executes a complete marketing plan which includes advertising and promotions, participation at trayel trade shows, brochure development and distribution, publicity, assistance with group and conference planners, market research, And- film production development. Advertising: The VCB's advertising campaign consists of both black and white and full color ads which run in major general interest and/or travel oriented magazines in California. In addition, the VCB advertises in newspapers in our major- markets as well as specific tour and travel publications (see attached schedule) . Trade Shows: The VCB attends trade shows targeted to travel Agents, tour operators, corporate and association meeting planners, and general consumers. The VCB will continue its membership with the Central Coast Tourism Council which further augments our trade show schedule. Film Development: The VCB established the San Luis Obispo county Film Commission in 1987 as a division of the Bureau. It's task is to promote this area as a location for feature motion pictures, television, and commercial production. Familiarization tours are conducted with location managers and photographs are taken and sent upon request to production houses. The Film Commission works closely with the California Film Commission on the development of a unified permit process, education on duties of police and fire departments, as well as referrals from production companies. Brochure: The VCB has produced three brochures, the full color "Jewel of the Central Coast", an accommodations guide, and a member directory for restaurants and other members of the Bureau. Distribution of these brochures is at all trade shows, to all ad respondents, and through McClellan Corporation; a firm that distributes to travel agents in the USA, Canada, and Mexico. Publicit • Monthly newsletters are Publicity: y produced and sent to businesses throughout the county describing the activities of the VCB and other- pertinent travel industry information. Press releases and press kits are produced and sent to travel writers Wi I Chono Sneer iuik E. -Son Lui> Obigv. L-,dito inia 9311 l (805) 5-H-8000 g-/ in our markets as well as to local and regional editors. Familiarization tours for travel writers are conducted as they are requested either as a group or for individuals. Group Business: The VCB's focus has been in the solicitation of corporate and association business as well as motorcoach tour business. In addition to group sales, VCB conference services range from site and activity referrals to assistance with registration, and tour development. Promotions: The VCB conducts familiarization tours with travel agents, tour operators, film producers, and travel .writers. Promotional events also include monthly employee recognition awards and some special activity events. Market Research: The VCB continually requests information regarding occupancy rates, origin of visitors, and group business from its members. The data that is received provides the VCB with valuable information about our visitors. The California Department of Commerce provides us with the economic impact of tourism on a state and regional level but no longer provides us with county-wide tourism impact figures. 1990/9.1 PROGRAM HIGHLIGHTS Each of the programs that the VCB undertakes this year will be characterized by a need to exercise conservative spending while increasing tangible results. Major expenses this year include the reprinting of the VCB's single, most important promotional piece, the "Jewel .of the Central Coast" brochure. Group Business: In addition to the brochure, the VCB plans to increase its emphasis in the motorcoach tour, association, and corporate meetings business. By attending specific trade shows targeting these markets, the VCB .can influence the travel planner's itineraries. The meeting planner shows will be a significant addition to the VCB's program of 1989/90. Participation in the tour operator shows is a continuation of a multi-year marketing program. Film Commission: Film production in the county in 1989/90 made a significant contribution to several communities and private businesses. Three major features and several commercials spent more than $3.5 million in our hotels and restaurants, including other businesses that are not directly affected by the tourism industry. Servicing, as well as attracting more film production requires significant staff time and aggressive marketing techniques over and above the programs of last year. Advertising: The VCB continues to show strong results .from the ad campaign eventhough part of the program was reduced from the previous year. 1990/91 will see 'a campaign that maintains the q-�3 0 quality of promotions that we've established while increasing tangible results. Publicity: Press coverage of the VCB events have created a greater awareness of the impact of the tourism industry in this county. We have also hosted many travel editors resulting in increased coverage of this county as a tourism destination. our plans for 1990/91 will place an increased emphasis on our publicity programs requiring more output from our current staff levels. Results: While the demands on the. VCB have increased to add more programs, results have increased as well. The most significant result is that the amount of bed tax collected countywide increased 17% from 1987/88 to 1988/89 and 14% .in the city of San Luis Obispo in the same time period. These increases indicate that the VCB's promotional efforts have reaped benefits greater than they have "cost". The VCB plays two roles when it comes to group business: The groups that have not determined the location of their meeting are referred by the VCB to sites that best fit the meeting planners needs. Other groups have already secured their meeting site but require services such as registration assistance, activity planning, and brochures. In 1989/90 the amount of group business that the VCB assisted totaled a minimum of 12,000 delegates with a potential revenue of $1.3 million to the county. With an increased emphasis planned for this market segment, the county will see greater results in the future. Budget: While the programs of the VCB have increased significantly and costs of doing business have risen 10% to 25% depending on the program, the VCB's overall budget has increased only slightly since the VCB was established four years ago. It is difficult to determine a budget prior to actual funding when the amount of funding from each municipality is always in question. Based on a conservative funding level the following promotional budget is being proposed. At this level., two programs that have been targeted as major priorities for the VCB by the Board of Directors will have a decrease over last year's budget or no funding at all. Targeting group business (meeting planning and. motor coach tours) via trade shows has a 9% decrease. and the Film Commission has no available funds. Printing the VCB brochure will have to be reduced to just one year's supply instead of three which increases the cost per unit. • PROPOSED 1990/91 PROMOTIONAL BUDGET PROPOSED ACTUAL ADVERTISING/PROMOTION 1990/91 1989/90 Magazine Placements $ 25, 358 $ 23,700 Newspaper Placements 6,263 7,500 Advertising Production 200 21000 Publicity 51100 4r500 . Direct Mail 0 4,500 Ad Response 90855* 8,967* BROCHURES Brochure Printing 161000** 10.,000 Brochure Distribution 5,000 5,000 Brochure Production 2,000 800 TRADE SHOWS Trade Show/Annual Meeting Regist. 9,100 13,200 Trade Show/Annual Meeting Travel 9,000 7,,500 Association Memberships 3,500 3,000 TOTAL PROMOTIONAL BUDGET $ 91,376 $ 90,667 (+.8%) TOTAL BUDGET $206,470 $195,375 (+5.7%) *Ad response includes a 'portion of contract labor total. ** Brochure printing includes membership and accommodations brochure inserts and only one year's supply of "The Jewel ,of the Central Coast" brochure. o SLO COUNTY VCB 1990/91 PROPOSED MEDIA SCHEDULE Revised PUBLICATION INSERTION TYPE/ DATES _ SIZE COST CIRC California Mag Aug,March TP $6,460 S. CAL Nov,Jan 4/c, 9,000 TOTAL Travel & Leisure Sep, Nov, 4/c 11,997 CALIF Jan CALIF Sunset Magazine Aug, Dec B/W 21,380 S. CAL Oct, Feb B/W 2,414 CENTRAL Travel Planning July 4/c 2,528 TOTAL Guide CA RV Park & Jan B/W 961 TOTAL Campground LA Times Sept-Mar 1" . (4X/mo) B/W 4,686 ROP 4x5" (lx/mo) B/W 10,813 ROP San Jose Merc. Sept-Mar 1" (2x/mo) B/W 863 ROP 4x5" (lx/mo) B/W 4,314 ROP Wine Spectator 620 Pac Bell Monthly Listings 714 SLO CNTY TOTAL $57,750 SLO (� ITY. VCB 1990/91 PROPOSED TRADIDHOW SCHEDULE Revision #3 • DATE/ REGIS. STAFF TRADE SHOW PLACE COST TRAVEL DAYS MEETING .PLANNERS SCSAE Annual 12/1/90 $ 400 $ 450 2/1 Century City Corp Trvl Wst 12/3-4/90 1,420 450 2/1 San Francisco SSAE Annual 12/6/90 425 450 3 Sacramento WCAE Annual 5/18-22/91 350 900 3/2 Phoenix air/inc MPI Annual 6/23-26/91 350 1,000 4/1 Las Vegas air/inc LEISURE TRAVEL AGENTS/CONSUMERS Wstrn Canada 10/15-19/90 11950 .300 5/1 Sales Mission Vancouver Calgary Edmonton Eastern Canada 9/17-21/90 21400 300 5/1 Sales Mission Montreal Toronto Ottawa Northeast 2/3-8/91 21750 300 4/1 Sales Mission New York Boston Travel Mktplace 11/1-2/90 950 4 Dallas 570 Ft. Worth 470 Travel MktPlace 11/5-1/90 1,71.0 900 4/2 (3) Los Angeles Travel MktPlace 11/13=15/90 11710 600 4 (3) San Francisco Consumer Show 3/91 500 300 2 Southern CA Consumer Show 3/91 100 100 1 S.J. Valley TOUR. OPERATORS/MOTOR COACH NTA 11/11-16/90 895 11450 5/1 Montreal NTA 4/21-24/91 525 750 2/1 Portland air/inc POW WOW 5/11-15/91 2,000 1,250 4/2 Denver air/inc FILM COMMISSION Am. Film Comm. 2/91 10250 300 1/1 CO-OP Santa Monica TOTAL 19,775 10,750 70 9 —/7 . o Tr 1 Ad\'C:i>ing PuMit Rc!:aion> Graphic Dv>;gn Ili"Viou dr:Lago San Luis Ohspo California 93+-11 80i4-k-6i9 Tourism Promotion Plan for the City of San Luis Obispo Prepared by SJ FRANCIS&ASSOCIATES May 7,1990 ATTACHMENT 3 Q • RMODUCHON SJ Francis&Associates is pleased to present the City of San Luis Obispo with a proposal to increase tourism to the City. Accompanying this proposal are samples of work,background information on the agency and professional references. When you select an advertising agency,it will be to your benefit to choose an innovative firm familiar with travel promotion,government agencies and the special qualities of San Luis Obispo. It is also important that you work with a firm that has experience in creative thinking,advertisement planning and production,media.buying, publicity and promotions. SJ Francis &Associates meets these requirements. U 1 OBJECTIVES AND PHILOSOPHICAL APPROACH One of the first decisions in a promotional campaign is positioning.How do we want the potential visitor to think about San Luis Obispo?How do we want him (or her)to feel about our city? When we position San Luis Obispo,we place it in a certain way in.the prospect's mind. This is accomplished through a positioning statement.A positioning statement.should: • Define what San Luis Obispo offers visitors • Set the city apart from competing California destinations • State a meaningful benefit to our target market • Establish a distinctive personality A sample positioning statement for the city is: San Luis Obispo is a small,cultured city in an unspoiled and serenesetting.It mixes small-town pride and gusto with metropolitan appreciation for scenic beauty and cultural expression. San Luis Obispo refreshes the visitor with its beauty, gentle recreation and friendly residents. Residents freely say"hello"to visitors and are eager to offer directions and helpful advice. Tourists feel welcome to explore historical and cultural landmarks,shop in an old-fashioned downtown,enjoy diverse dining and partake in unusual festivities and events. Plus, visitors can use San Luis Obispo as their base for seeing other county attractions, including Hearst Castle,beaches and wineries. Once we agree on how to position the city,the next step is to set the strategy. SJFA recommends defining these five points to create a strategy statement for promoting tourism: L The objective—What we want the promotional campaign to accomplish. SJFA recommends this objective: Motivate the target market to request additional visitor information. The objective of the follow-up information is to close the sale or generate a second request for more information. 2.The target market—Pinpointing who the most likely visitors are. This leads to selecting appropriate magazines and newspapers for advertising placement. The Chamber of Commerce has found that approximately 50% of San Luis Obispo visitors are from Southern California,30%are from the San Joaquin Valley and 20% are from the Bay Area.The Bay Area is the fastest growing group of visitors. Research conducted for the California Department of Commerce shows that Californians who travel 100 miles or more for pleasure trips within the state are- 2 re2 Cl • Slightly older than the general population (median age 48.1 years vs.45.5 years) • More highly educated (68.8% had at least some college vs. 61.8%) • Have a higher household income(median$41,100 vs. $34,300) • Own their homes (73.5%vs. 64.9%) • Are employed in professional/technical or managerial occupations(34.3% vs. 24.0%) It is vital to consider the target markets'lifestyles in addition to their demographics. Designing a promotional campaign targeted towards affluent adults aged 35-65+ who live in southern California,the San Joaquin Valley and the Bay Area,hold professional jobs,and are interested in what San Luis Obispo offers will bring results. 3. The consumer benefit—Make it a meaningful benefit.This is pulled straight from the positioning statement.Highlight the benefit in all promotions. 4.The support to make the benefit believable—Give facts,use testimonials,show photographs. Be precise. S.The tone and manner—Call it personality or image.San Luis Obispo is friendly, unpretentious,culturally rich and proud.Express it. Finally,stick with the strategy.Once the basic nature of the promotional campaign is decided,has been tested and perfected,stay with it.Virginia's tourism campaign"Virginia is for lovers"endured for 20 years and through three governors,was dropped for something new—then brought back. It still brings results. 3 p O SUMMARY OF PROMOTIONAL CAMPAIGN "Share it with someone special" has been San Luis Obispo's campaign theme for the past two years.SJFA proposes keeping this theme and illustrating it in ttie print advertisements. The specific message of these advertisements will continue to encourage overnight visits. Realizing that the city is in the midst of a drought,each ad will carry the City's water conservation message Conservation is a way of life. Residents living within a 250-mile radius of San Luis Obispo will be the primary geographic market,followed by all.residents of California.Upscale adults interested in travel and gentle recreation will be the primary lifestyle market. Print Advertisements SJFA recommends creating a 1/3 page four-color ad for placement in select magazines, and several compatible I column x 4"black&white ads for Sunset and key newspapers. Each ad will reflect the five-point strategy. Ad placement will be coordinated with the Visitor and Conference Bureau's advertising schedule.This will make full use of exposing target markets to the words "San Luis Obispo" and avoid duplication. Magazines are an excellent way to reach a specific audience.They provide high quality ad reproduction.They are read.in a leisurely environment. They also have a longer life compared to newspapers.SJFA recommends advertising in California magazine,Los Angeles Magazine,Sunset,Travel&Leisure and Westways. Newspaper;have a much shorter lead time than magazines.They allow the advertiser quick access to a geographically precise market.SJFA recommends placing ads in different newspapers at key times in the off season. If,for instance,the San Joaquin Valley is trapped in winter fog,that provides the perfect opportunity for advertisingsunny San Luis Obispo. Or, when southern California is smothered by Indian Summer smog,the City can advertise bright,blue skies and sweet ocean breezes. All print ads will encourage response to the Chamber of Commerce,whether by phoning for information,writing or using a Reader Response card. The Chamber staff does an excellent job of tracking ad responses,giving us an accurate measure of ad and media effectiveness. Radio Promotion SJFA recommends repeating the winter radio promotion with Fresno station KFRE and Bakersfield station KLLY In the 1989-90.campaign,the KFRE and KLLY promotions 4 • increased the City's ad dollars by 230.The Ci ty gained than$12500 in exposure through this one promotion. SJFA proposes giving weekend trips for two to San Luis Obispo as prizes in the two radio promotions. During the promotion,the radio stations will broadcast facts and trivia about San Luis Obispo (furnished by SJFA).This exposure is free.The prizes will be for one night's lodging,dinner-for-two one evening,and brunch or breakfast for two.Hotels,motels and restaurants in the city will donate rooms and meals in exchange for promotional mention on the radio. This type of special event will focus attention on San Luis Obispo during January and February,giving the City free radio exposure to a proven market within a 3-hour drive. Radio promotions are very difficult to evaluate..The radio stations receive the phone calls,and we are dependent on their evaluations. Both radio stations I FRE and KLLY claim that their listeners have been very excited about the San Luis Obispo promotion. Each station said that listeners who normally don't participate in contests called in—from their homes,offices and even their cars.KFRE typically begins receiving calls in September from listeners asking if the San Luis Obispo promotion will be held again. GThe radio promotion will be evaluated by the number of calls--and who placed the calls—that each radio station received. The dollar value of the promotion will also contribute to the evaluation. Market Research At present,we do.not know what percentage of ad respondents actually come to San Luis Obispo.We also lack specific lifestyle information about our target markets in Southern California,the San Joaquin Valley and the Bay Area. The City needs to pinpoint who comes to San Luis Obispo and why.This further understanding of our target markets and the attractions San Luis Obispo holds for them will make tourism advertising much more effective. SJFA recommends commissioning a market research study to learn more about current and potential San Luis Obispo tourists.Good market research requires research professionals and money.SJFA recommendsthatthe City increase the proposed ad budget by at least 25% to finance professional market research. This investment should be viewed over a 10-year period.Accurate market.research that is used wisely can make the City much more competitive in tourism promotion SJFA will work with the Chamber of Commerce to design an outline of needed 5 q-�3 i information.SJFA will.commission and supervise the market research. Additional Suggestions San Luis Obispo competes head-on with Santa Barbara,Monterey and cities within our county for visitors.The City must consider what our future visitors and residents will want and enjoy. The following suggestions are not within the realm of this promotional contract.But to assure San Luis Obispo's continuing status as a desirable tourist destination,SJFA recommends that the City consider initiating additional reasons for the traveller to come to San Luis Obispo. SJFA suggests that the City: • Create new walking tours. These are popular and relatively simple to create. • Stage a wintertime "SLO Gourmet Fair" Feature locally created food and beverage products. This will appeal to residents as well as visitors. • Establish a botanical garden with a daytime conference center.Visitors and residents will frequent the garden.The conference center could be used for weddings,dances,large private parties and,naturally,meetings in a garden setting. • Create specific promotions. Like advertisements,promotions are targeted toward.a specific market and last several weeks or months. Since many wineries are within a comfortable drive from San Luis Obispo,the city hotels could promote Autumn Harvest weekend packages to wine lovers. Target naturalists with a Winter Migration package when the California grey whales journey to Baja.Solicit antique car dubs and adult motor touring clubs to come to San Luis Obispo for a special back roads scenic tour.. These do not have to be discount packages.They do have to offer something that is meaningful to the target market.For the wine lover,include a picnic lunch and gourmet dinner with the winemaker. For the back roads traveller,provide.a guide book,picnic lunch and San Luis Obispo key fob. Target tour operators and special interest dubs(camera,Audubon,cycling,wine,hot air balloon, golf).Send press releases about the promotions to travel writers and travel editors.And keep the promotions consistent with the city's positioning and advertising. strategy. Perhaps the Visitors&Conference Bureau could coordinate package promotions. 6 9-ay GENERAL SCHEDULE According to Chamber of Commerce research,occupancy rates in San Luis Obispo are lowest between November and March.SJFA suggests running the majority of print ads between November and April. The two radio promotions will be run at the same time,in January and February.This takes advantage of traditionally yucky weather in the San Joaquin Valley and the post- Christmas lull in radio advertising. Here is the general outline of promotional services: July: City Council approves promotional contract Agency prepares sample ads for PCC approval PCC approves ad concept August: Agency prepares print ads Agency prepares media schedule and.budget PCC approves media schedule and budget September. Agency places magazine ads forNovember issues Agency begins negotiations for radio promotions October. Agency presents radio promotion outline to PCC for approval Agency places magazine ads for December issues November. Agency places magazine ads for January issues Agency begins contacting hotels and restaurants about participating in radio promotion December. Agency places magazine ads for February issues Agency secures hotel and restaurant participation in radio promotion Agency packages and ships promotional materials to radio stations January: Agency places magazine.ads for March issues Agency places appropriate newspaper ads for January Agency supervises radio promotions February: Agency places magazine ads for April issues Agency places appropriate newspaper ads for February Agency supervises radio promotions March: Agency places appropriate newspaper ads for March Agency evaluates radio promotion April• Agency evaluates ad responses to date May: Agency evaluates ad responses to date June: Agency evaluates campaign 7 BUDGET DISCUSSION The majority of the funds will be used to purchase ad space in magazines and newspapers.Which magazines and newspapers are used will be determined once the five- step advertising strategy is completed and approved. SJFA proposes preparing. * 1 four-color 1/3 page magazine ad to run in glossy magazines • 4 black&white 1 column x 4"ad for Sunset and newspapers SJFA recommends at minimum a 10% budget increase over the 1989-90 budget of $73,500.Advertising costs increased between 8 and 15 percept during fiscal year 1989-90. In order to just maintain the City's media presence,a budget increase.of 10% is vital. The following estimate is based on ideas presented in this proposal.Allcosts are approximate. Media placement* $55,250 Ad production 0 4C ad,4'B/W ads) $ 5,500 Radio Promotions coordination $ 4,000 Printing** $ 6,500 Account service $ 900 TOTAL for FY 1990-91 $80,850 *Net cost. Gross cost is$65,000.Agency will pass on 15% agency commission. **Includes reprinting 30,000 City brochures and 12,600 "Thanks for Writing"notes 8 CCONCLUSION By determining how San Luis Obispo should be positioned and what strategy should be used,the City will have the foundation for a strategic and lasting promotional campaign. A successful campaign will: Increase awareness of San Luis Obispo as a pleasure destination • Enhance San Luis Obispo's positive image • Maintain market share of visitors • Bring first-time tourists to the city • Increase the possibility for word-of-mouth references • Create goodwill between visitors and the community SJ Francis&Associates is expertly qualified to provide the services and materials presented in this outline.Thank you for considering SJ Francis&Associates. This is a proposal,not a fam action plat,and therefore is open to dlscmdon.In the event that SJFA is not selected to handle toutimn advertising for the City of Sen Gas Obispo,we tespeeffiXy regnest that this and any copies of this proposal be retuned to SJFA by Jane 15,1490. i 9 PROJECT MANAGER SJ Francis&Associates is owned by Sallie J.Francis.Sallie has lived and worked in San Luis Obispo for 18 years. A journalism graduate of Cal Poly,Sallie has worked in the advertising and public relations profession since 1976. SJ Francis&Associates contracts with several talented freelance professionals for photography,radio and TV production, graphic design and other.services. Creativity is not a function of size and small is not necessarily limiting.SJ Francis& Associates has the talent,innovation,desire and experience to handle the promotional campaignfor the City of San Luis Obispo.. SALVE J. FRANCIS Experience Sallie brings more than 17 years of advertising and public relations experience to SJ Francis&Associates. A resident of San Luis Obispo County since 1972,Sallie offers proven experience in the advertising profession and tourism promotion. Sallie has worked as a media buyer for an advertising agency,promotional coordinator for the San Luis Obispo Chamber of Commerce,promotions manager for a resort in the Bahamas and manager of the County RideShare Program. She managed public relations and promotions for a hotel management company and was a full partner in another advertising agency before forming SJ Francis &Associates. Sallie has proven experience in promotional planning,media selection and ad placement. She has produced effective newspaper,magazine,radio and TV advertisements and public service announcements in addition to numerous brochures and newsletters. Sallie is also highly skilled at special event production.While managing the San Luis Obispo County RideShare Program,sheinitiated and coordinated the first California state- wide RideShare Awareness Week She also created an out-of-town radio tourism promotion that boosted a client's ad budget by 49%d. Memberships & Activities Member. Public Relations Society of America Member. Promotional Coordinating Committee,City of San Luis Obispo, 1986-87 Member.San Luis Obispo Chamber of Commerce Professional Advisor. Cal Poly Public Relations Student Society of America 10 SJ FRANCIS&ASSOCIATES SJ Francis&Associates offers you a full range of promotional capabilities. We work with you to achieve your objectives.We combine your thorough knowledge of your business with our advertising expertise.The result is promotional work that sets you. apart from your competition and brings results. • Structure As a small agency,we place high emphasis on client service.You have direct access to top talent working on your account We are flexible and able to quickly "respond to fast- breaking changes. • Creativity A creative approach has impact. It grabs the attention of your audience.so they can receive your message. However,we do not believe in creativity for its own sake. We balance information about your business,the marketplace and the community with creative thinking.This assures you of a campaign that stands out from your competition. • Cost-Consciousness Successful advertising must be cost effective.We are as prudent with your money as we are with our own. • Professional Contacts After working in this profession for many years,we have developed an extensive network of relationships. Media contacts,appropriate suppliers,freelance talent and resource people are available to us and,therefore,your account • Philosophy We believe that a client and its advertising agency enter into a partnership.We see things through your eyes,yet offer objectivity.We strive to anticipate rather than wait to react. And.we're never satisfied with "good enough." PROFESSIONAL REFERENCES David Garth Paul Kuzniar Chamber of Commerce The KuzniarGroup San Luis Obispo,CA Santa Monica,CA 543-1323 213/396-6115 Dick.Mason Desmond Seales US98/KVEC Diversified Services San Luis Obispo,CA Geroge Town,Grand Cayman 541-8798 809/947-4325 11 q SAN LUIS OBISPO PROMOTIONAL AND ADVERTISING CONTRACTS Contract Ad Budg989-90 1 19aue PCC19W91R Budget ,Request PCC Rec. S.J. Francis (Advertising) $ 73,500 $ 75,700 $ 80,850 $ 80,850 Chamber of Commerce $ 45,500 $ 46,800 $ 48,230 $ 48,230 (Visitor Services) Chamber of Commerce $ 26,500 $ 27,400 $ 28,090 $ 28,090 (Promotion) Chamber of Commerce $ -0- $ -0- $ 5,800 $ 700 (Water Awareness) Visitors and Conference $ 35,700 $ 36,800 $ 46,000 $ 46,000 Bureau (Promotion) Total $181,200 $186,700 $208,970 $203,870 ATTACHMENT 4 • l ��0 T5 ILI Pullik Graphic Dvs;,.:n 113-Vis:,del Lj�go Memo to: City Council members Sir,Luis Ohisno Caffoln;2 93i From: Sallie Francis, SJ Francis & Associates 11 84' '4t-'`'`' Date: June 7, 1990 Subject: Tourism Promotion Advertising Contract In response to the City's request for a proposal, SJ Francis & Associates submitted a Tourism Promotion Plan to the Promotional Coordinating Committee. As you know, the PCC voted to recommend that SJ Francis & Associates continue as the agency of record for the City's tourism advertising program. This agenda item was originally planned for your June 6 meeting. However, it has been rescheduled for the June 19 meeting. Unfortunately,I will be out of the country from June 18 through July 8. Since I cannot be in two places at one time, and since this trip has been planned for several months, I will not be able to attend the June 19 meeting. Therefore, if you have any questions or concerns, or just want to touch bases with me about this proposal, please call me at 5446849 between 8:30 am and.5:00 p.m weekdays. If this is inconvenient, call me during the evening at 5449140. I will be happy to answer your questions, explain strategies, and guide you through the previous years' promotional campaigns. Many thanks. ATTACHMENT "511