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HomeMy WebLinkAboutagenda.council.worksession.20171010 CITY COUNCIL WORK SESSION October 10, 2017 4:00 PM, City Council Chambers MEETING AGENDA I. Board Interview - Wheeler Board of Directors II. Budget: Tourism / Public School / REMP / Wheeler P1 P2 I. 2018 Proposed Budget October 10, 2017 P3II. Tourism Promotion Fund 2 •Lodging Tax: 3.5% Growth Projection Transportation Fund (25%) Tourism Promotion Fund (75%) •Supplemental Request Auditing Staff Current Year Revenue to Tourism $2,802,240 Transfer to General Fund $35,060 Expenditures = $2,837,300 Audit Staff General Fund Tourism Transportation Kids First Housing Dev Parks 25% General Fund 25.00% 25% Lodging Tax Funds 18.75%6.25% 25% Sales Tax Funds 1.50%3.00%2.50%18.00% 25% Use Tax Funds 25.00% Total Staff Allocation 25.00%18.75%32.75%3.00%2.50%18.00%P4II. Public Education Fund 3 •Voters Extended 0.3% Tax (Nov. 2016) •Pass Through of Collections 98% to Public Ed. Fund 2% Administrative Allowance •Sales Tax Forecast Plus 20% Administrative Costs $54,000 Distributions to Aspen Public Education Fund $2,646,000 Expenditures = $2,700,000 P5II. REMP Fund 4 •Joint Effort with County •Administered by CORE •2017 Ending Fund Balance •Police Department Bldg •$135K for LEED GoldDesign Assistance Grants $12,500 Climate Action Planning $12,500 Community Grants $25,000 REACH Grants $37,500 Engagement & Marketing $37,500 New Initiatives $50,000 Randy Udall Grants $277,500 Energy Smart Grants $312,500 Admin. $420,000 $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 Expenditures = $1,185,000 New Programs P6II. Wheeler Opera House Fund 5 •0.5% Real Estate Transfer Tax •New Revenue Tied to Supplemental ▪Rental Income Restaurant and Gallery Utilities + Rent 0.5% Real Estate Transfer Tax $3,713,000 Arts Related Revenue $920,000 Rents and Utilities $219,000 Other Revenue $628,700 Revenues = $5,480,700 P7II. Wheeler Opera House Fund 6 •Supplementals: 462,760 Programming Expansion: $275,900 Sponsorship Support: $61,000 Arts Grants: $50,000 Programs Assistant: $75,860 •Capital Improvements: $506,500 Orchestra Seating: $255,500 Stage Lighting: $80,000 Basement Restroom / Dressing Room: $55,000 Security Cameras: $35,000 Stage Audio Equipment: $28,000 Humidifiation: $27,500 Assistive Listening Loop: $20,000 Box Office Noise Mitigation: $5,500Administrative $557,910 Arts Grants $400,000 Arts Programming $2,235,420 Capital $506,500 Property / Facility Maintenance $364,670 Transfers $565,900 Expenditures = $4,630,400 P8II. Wheeler Opera House Fund 7 2013 2014 2015 2016 2017 Proj.2018 Proj. Fall 0 0 0 6 13 15 Winter 20 22 20 23 32 40 Spring 0 0 0 0 0 0 Summer 0 0 0 0 7 12 Wheeler Presented Events 20 22 20 29 52 67 Community Events 143 152 140 189 196 210 Total Performance Days 163 174 160 218 248 277 % of Year 45%48%44%60%68%76%P9II. Wheeler Opera House Fund Arts Grants: Monetary 8 2018 Request 2018 Recommend 5Point Adventure Film $5,000 $1,500 Anderson Ranch Arts $10,000 $6,000 Aspen Art Museum $100,000 $15,000 Aspen Choral Society $10,000 $5,000 Aspen Community Theatre $10,000 $7,000 Aspen Dance Connection $2,000 $1,500 Aspen Film $38,000 $35,000 Aspen Institute (Bauhaus Centennial)$15,000 $15,000 Aspen Music Festival and School $175,000 $85,000 Aspen Santa Fe Ballet $105,000 $85,000 2018 Request 2018 Recommend Aspen Writers Foundation $25,000 $25,000 Jake Foerster Music Art Fund $10,000 $0 Jazz Aspen Snowmass $35,000 $31,500 Pegasus Repertory Theatre $10,000 $3,500 Red Brick Council for the Arts $40,000 $30,000 Roaring Fork Music Society $2,500 $500 Theater Masters $4,500 $3,000 Theatre Aspen $50,000 $43,000 Wyly Community Arts Center $5,000 $2,500 Undistributed Funds*N/A $5,000 Total Requested: $652,000 Total Recommended: $395,000 (*Additional $5,000 in Budget)P10II. Wheeler Opera House Fund Arts Grants: In-Kind 9 2018 Request 2018 Recommend 5Point Adventure Film N/A $3,500 Aspen Choral Society N/A $5,000 Aspen Community Theatre**N/A $2,500 Aspen Film $5,000 $0 Aspen Santa Fe Ballet**$2,000 $2,000 Pegasus Repertory Theatre**N/A $1,500 Total Requested: $7,000 Total Recommended: $14,500 ** Reflect Box Office Deductions P11II. Wheeler Opera House Fund 10 Net Change to Fund Balance: $850,300 $0 $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 $30,000,000 $35,000,000 $40,000,000 2017 Forecast 2018 2019 2020 2021 2022 Ending Fund Balance Revenue Expense 25% Reserve Requirement P12II. 1 MEMORANDUM To: City Council cc: Steve Barwick Sara Ott Don Taylor From: Debbie Braun, President Julia Theisen, VP sales and marketing Date: October 5, 2017 Re: 2018 Destination Marketing Plan and Budget The Aspen Chamber Resort Association has managed the destination marketing funds for the City of Aspen since the first lodging tax was passed in 2000. We continually strive to attain the highest return on the marketing investment to drive visitation and business to Aspen in line with ACRA’s vision: Creating an environment for Aspen to thrive. We appreciate our continued partnership with the City of Aspen as stewards of this fund. Attached you will find a review of the 2017 key initiatives and an overview of the 2018 plan and budget. Also attached is the executive summary from the visitor research and special events research we conducted this year and latest occupancy report. The budget for 2017 was projected at $2.6M. The annual budget is reviewed by ACRA’s Board of Directors, the Marketing Advisory Committee and the Aspen Lodging Association prior to approval by the City of Aspen. The budget and financials are reviewed on a quarterly basis by ACRA staff, ACRA’s finance committee, Board of Directors and are then sent to Don Taylor, City Finance Director for final review. The reserve funds are currently $330K and a goal of $500K reserve was agreed by the end of 2019. As you can see from the attached budget, 90K is allocated to the reserve fund for 2018 with the balance being reserved in FY19. This year we are hosting a Tourism Outlook on Wednesday October 18th from 8:30-12:30 at The Gant. Key stakeholders have been invited to learn more about the tourism outlook on a national, state and local level. The budget and plan will be reviewed and approved at the meeting. We welcome participation from the City Council. P13 II. 2 ACRA’s current destination marketing contract is being reviewed for renewal on the consent agenda at City Council meeting on October 23rd. ACRA will be present at this meeting to answer any questions. We enjoy working with the City to create an environment for Aspen to thrive and appreciate your continued partnership. Please reach out with any questions on this information. P14 II. FY2018 Marketing Plan Aspen Chamber Resort Association P15 II. Introduction ACRA’s destination marketing drives Aspen to thrive. The 2018 Annual Marketing Plan is a framework to guide the marketing initiatives in the upcoming fiscal year. This plan provides an overview of the tourism outlook, advertising and promotional projects. ACRA Mission Attract visitors to the resort, foster a dynamic Aspen experience, benefits to support a sustainable local economy. ACRA Vision Creating an environment for Aspen to thrive. Funding The destination marketing budget is currently funded from a 2% lodging tax which is split between Roaring Fork Transportation Authority (RFTA) and Destination Marketing and 1.5% DM). The 2018 marketing budget is proj 2017 Key Metrics Occupancy · Aspen Paid Occupancy R · Aspen Average Daily Rate for March Defy Ordinary - New Creative Campaign Website ACRA’s destination marketing drives year-round tourism to Aspen to create an environment for Aspen to thrive. The 2018 Annual Marketing Plan is a framework to guide the marketing initiatives in the upcoming fiscal year. This plan provides an overview of the tourism outlook, projects. Attract visitors to the resort, foster a dynamic Aspen experience, and provide valuable member benefits to support a sustainable local economy. Creating an environment for Aspen to thrive. marketing budget is currently funded from a 2% lodging tax which is split between Roaring Fork Transportation Authority (RFTA) and Destination Marketing . The 2018 marketing budget is projected flat against the 2017 budget Aspen Paid Occupancy Rate for March – August: -1.5% Aspen Average Daily Rate for March – August: +5.6% Creative Campaign 2 tourism to Aspen to create an environment for Aspen to thrive. The 2018 Annual Marketing Plan is a framework to guide the marketing initiatives in the upcoming fiscal year. This plan provides an overview of the tourism outlook, and provide valuable member marketing budget is currently funded from a 2% lodging tax which is split between Roaring Fork Transportation Authority (RFTA) and Destination Marketing (.5% RFTA budget at $2.6M. P16 II. 3 · Updated landing pages (Arts & Culture, Recreation, Explore Aspen, and Dining & Nightlife) led to increased conversions. · Blog was redesigned and Accelerated Mobile Page functionality was added. · Organic traffic to the blog has increased 110% YOY (July – August). · Average Time on Page and Bounce Rate have improved over 5% YOY (July – August). · Technical and content optimizations implemented to improve search engine optimization (SEO). Partnerships ● Air Service Update ○ Fall Shoulder Season: ■ United and American Airlines extended their service on nonstop routes from LAX (UA) and DFW (AA) to operate daily throughout both October and November until winter season flights resume in December. ○ Winter: ■ American Airlines will have up to 8x daily flights from DFW, ORD, PHX & LAX. PHX is a new hub and this represents a 60% capacity increase over the holidays, 50% increase in January, and 45% increase in Feb & March. ■ Delta Air Lines will have 6-7x daily flights from SLC, LAX, ATL & MSP. This is a 53% increase over the holidays and 33% increase Jan – March. ■ United Airlines will have 20-25x daily flights from DEN, ORD, IAH, LAX & SFO. Most significant capacity increases are from 20% from early January – Mid February. ● World Cup & X Games ○ ACRA was pleased to contribute to the overwhelming success of the heritage ski event World Cup ($75K). ○ ACRA continues to be a proud partner in X Games ($165K). ● International PR ○ ACRA partners with Snowmass Tourism to highlight the Aspen/Snowmass brand in key international markets: the UK, Germany and Mexico. ○ ACRA and Aspen Skiing Company collaboratively host media and travel trade throughout the year. Group Sales P17 II. Our sales team has worked hard to generate more group business this year by attending the following tradeshows: · MIC · Denver Wedding Planner Reception · Luxury Meetings · IMEX · Meetings & Incentive Forum · Engage! (new this year) · Destination Sales Missions · MPI Northern California and Client Events · Chicago PYM and Client Event These efforts have paid off, due to the following statistics: · Lead conversions have increased · The number of leads that came through YTD has also increased from 2016. Public Relations Targeted key media in domestic and host journalists in market and pitch to media in NY, Denver and LA/San Francisc · PR value: $7M · Total domestic print impress Coverage Highlights · Men’s Journal.com: Family · National Geographic: America’s 20 Best Mountain Bike Towns · Dallas Morning News: Vancouver, Aspen, Palm Springs and other places that will boost your brainpower · Forbes: Autumn Adventure in Aspen Our sales team has worked hard to generate more group business this year by attending Denver Wedding Planner Reception Forum Destination Sales Missions MPI Northern California and Client Events Chicago PYM and Client Event efforts have paid off, due to the following statistics: Lead conversions have increased from last year by 1%. eads that came through YTD has also increased from 2016. Targeted key media in domestic and international markets to highlight stories on Aspen. ost journalists in market and pitch to media in NY, Denver and LA/San Francisc Total domestic print impressions and online viewership: 937M Family Vacations That Don’t Suck America’s 20 Best Mountain Bike Towns Vancouver, Aspen, Palm Springs and other places that will Autumn Adventure in Aspen 4 Our sales team has worked hard to generate more group business this year by attending eads that came through YTD has also increased from 2016. arkets to highlight stories on Aspen. We ost journalists in market and pitch to media in NY, Denver and LA/San Francisco. P18 II. · Brides: Two Ways to Honeymoon in Colorado · Independent- Aspen in Summer: The Colorado Ski Town That Isn’t Just For Winter Summer Media Visits · Individual outlets included Washington Post, Western Art & Architecture, o 12 domestic and 8 international individual visits. · Group Press Trips included and Aspen Backcountry FAM. · Hosted two media for Aspen Summer Holiday o Coverage in OutTraveler.com (four different articles) and Attitude UK International Campaign · Partnered with Snowmass Tourism for international campaign. · Markets of focus were Germany, Mexico and UK. · Hosted two group FAMS one Mexico) and five individual UK visits · Stories covered adventure travel, family travel in Aspen, and Aspen & Snowmass as summer destinations. · Initiatives: media visits, press release, and pitching in markets. · CTO media visits: hosted a F (five media) in early fall. Social Media · FB: 5.5% increase · 137K followers · Average weekly reach · Average weekly post engagements · Twitter: 7% increase Two Ways to Honeymoon in Colorado Aspen in Summer: The Colorado Ski Town That Isn’t Just For Winter outlets included Elite Daily, Forbes, Out Traveler, Outside Magazine, Washington Post, Western Art & Architecture, and more. 12 domestic and 8 international individual visits. included JAS Labor Day Experience FAM (with Snowmass Tourism) Aspen Backcountry FAM. dia for Aspen Summer Holiday. Coverage in OutTraveler.com (four different articles) and Attitude UK Partnered with Snowmass Tourism for Germany, Mexico and UK. (one Germany, one Mexico) and five individual UK visits. Stories covered adventure travel, family travel in Aspen, and Aspen & Snowmass Initiatives: media visits, press release, and CTO media visits: hosted a France FAM FB: 5.5% increase Average weekly reach: 340,290 Average weekly post engagements: 48,292 Twitter: 7% increase 5 Aspen in Summer: The Colorado Ski Town That Isn’t Just For Winter Traveler, Outside Magazine, nce FAM (with Snowmass Tourism) Coverage in OutTraveler.com (four different articles) and Attitude UK. P19 II. · 13.7K followers · Average impressions per month: · Average · Instagram: 12.8% · 67.8K followers · Average comments per post: · Average likes per post: · Average weekly impressions: Tourism Trends Overtourism – a buzz word that is going to become Overtourism is the combined result of population growth, the rise of the middle class globally and reduced cost of travel due to travel industry consolidat come from China, which is expected to send over 3 million visitors to the US in 2019, a 172% increase over 2013 figures according to the US describes destinations where locals that the quality of life in the area or the quality of the experience has deteriorated unacceptably. Destinations around the globe are experiencing challenges with tourism’ impact on their communities and Sustainable Tourism – as destinations face growth, there is a stronger emphasis on sustainable tourism which is focused on culture, while helping to generate fut tourism is to ensure that development is a positive experience for local people; companies and tourists themselves. Destination marketing organizations are becoming destination management companies to develop guidelines and management practices towards a more sustainable tourism program. sustainable forms of travel and the industry should expect a shift in the mindset of travelers everywhere. They will be more interested in the environmental, economic and social impact they're making at the destination they visit and are likely to support companies and destinations that embody these values. Alternative Accommodation – positive impacts to the tourism industry. Airbnb alone has grown to over 3 million listings worldwide serving over 200M guests to date. The growth in the industry is multiplied by new competition in this space with numerous startu launching new chains aimed at looking for a lodging experience suited to their tastes and budges. Millennial Travel - Millennials are Boomers. As the youngest generation with disposable income, they have secured their as leaders in travel and tourism. They also lead in decision making 13.7K followers Average impressions per month: 55,000 verage profile visits per month: 1,916 Instagram: 12.8% increase 67.8K followers Average comments per post: 23 per post Average likes per post: 2,200 Average weekly impressions: 293,411 a buzz word that is going to become commonplace in the coming years. result of population growth, the rise of the middle class globally and reduced cost of travel due to travel industry consolidation. A huge portion of the growth ected to send over 3 million visitors to the US in 2019, a 172% increase over 2013 figures according to the US Department of Commerce. describes destinations where locals and/or visitors feel that there are too many visitors and that the quality of life in the area or the quality of the experience has deteriorated Destinations around the globe are experiencing challenges with tourism’ and are adapting to ways to manage tourism. as destinations face growth, there is a stronger emphasis on focused on creating less impact on the environment and local culture, while helping to generate future employment for local people. The goal of is to ensure that development is a positive experience for local people; themselves. Destination marketing organizations are management companies to develop guidelines and management practices towards a more sustainable tourism program. Global campaigns promote more sustainable forms of travel and the industry should expect a shift in the mindset of travelers ill be more interested in the environmental, economic and social impact they're making at the destination they visit and are likely to support companies and destinations that embody these values. – this sector continues to grow creating both negative and positive impacts to the tourism industry. Airbnb alone has grown to over 3 million listings worldwide serving over 200M guests to date. The growth in the industry is multiplied by new competition in this space with numerous startups and major hotel chains like Hilton and Marriot gaining Airbnb’s core market, essentially millennials who are looking for a lodging experience suited to their tastes and budges. Millennials are officially the largest generation in history, beating out Baby Boomers. As the youngest generation with disposable income, they have secured their as leaders in travel and tourism. They also lead in decision making- helping to decide what the 6 commonplace in the coming years. result of population growth, the rise of the middle class globally ion. A huge portion of the growth will ected to send over 3 million visitors to the US in 2019, a 172% Department of Commerce. Overtourism or visitors feel that there are too many visitors and that the quality of life in the area or the quality of the experience has deteriorated Destinations around the globe are experiencing challenges with tourism’s as destinations face growth, there is a stronger emphasis on less impact on the environment and local ure employment for local people. The goal of sustainable is to ensure that development is a positive experience for local people; tourism themselves. Destination marketing organizations are increasingly management companies to develop guidelines and management Global campaigns promote more sustainable forms of travel and the industry should expect a shift in the mindset of travelers ill be more interested in the environmental, economic and social impact they're making at the destination they visit and are likely to support companies and reating both negative and positive impacts to the tourism industry. Airbnb alone has grown to over 3 million listings worldwide serving over 200M guests to date. The growth in the industry is multiplied by new ps and major hotel chains like Hilton and Marriot millennials who are , beating out Baby Boomers. As the youngest generation with disposable income, they have secured their status helping to decide what the P20 II. 7 major trends and tastes will be and are not shy about getting exactly what they want, how they want it. When planning travel, Millennials are used to having their options conveniently available to them. They want to be able to research and book their trips and tours online. They will be the largest travel market in the coming years. Marketing Goals FY18 The purpose of the 2018 ACRA Marketing Plan is to provide strategic and tactical direction to achieve the following stated goals: 1. Maintain summer occupancy at 2017 levels, as reported by DestiMetrics. 2. Grow the softer spring and fall shoulder-season, driving occupancy. a. Spring = Memorial Day to Food & Wine b. Fall = September weekdays and October 3. Increase traffic referrals to aspenchamber.org. 2018 Marketing Strategies and Objectives ACRA will employ a multi-channel strategy to position Aspen as the destination within the competitive set. We will aim our marketing messages during the time(s) of year when increased visitation is most needed (spring and fall shoulder season) which has the most room for growth, while still maintaining near-sold-out occupancy in the peak summer months (Food & Wine through the end of September). ● Increase shoulder occupancy by increasing awareness for the spring and fall shoulder-seasons. ● Increase the number of new visitors adding Aspen to their travel consideration set. ● Focusing on younger visitors replacing the current aging demographic. ● Elevate Arts & Culture as a second brand pillar, in tandem with soft adventure. ● Continue to capture market share of overnight stays from the Colorado Front Range. ● Continue to change perception of Aspen as an unattainable playground for the wealthy, to an approachable mountain destination that defies ordinary. Tactics & Projects All tactics are inspired by the Defy Ordinary brand promise and will feature this inspirational charge against the backdrop of the diverse cultural makeup of Aspen, Colorado. The creative elements will feature the emotional drivers inspired by the destination and create a powerful connection with consumers, targeting them during strategically appropriate times in their vacation planning stages. 2018 Noteworthy Tactics & Projects New Inspiration Guide · A Field Guide focusing on editorial content, this will be an evergreen piece printed P21 II. 8 on recycled material. · Instagram version for social consumption featuring constantly updating content and stories. Research ● For 2018 replace the visitor intercept survey with an economic data study to better highlight the impact destination marketing has on the community as an economic driver. Responsible Tourism ● ACRA to partner with US Forest Service, Mountain Rescue and Pitkin County to empower visitors to enjoy our natural resources responsibly and in a safe manner. Advertising Strategy: Media Goals ● Deliver qualified visitors to aspenchamber.org, as measured by visitation to key pages: ○ Booking Click Off – 50% weight. ○ Where to Stay Page Views – 40% weight. ○ 4+ Minutes Spent on Site – 10% weight, 25% of view-through conversions are measured, and 100% click- through conversions are measured. ● Continue to measure performance against the Blended Action Model (BAM score), Cost Per Acquisition metric- campaign goal of $90.00. ● Continue to create brand awareness for the Defy Ordinary brand. The Target Consumer 1. Primary Audience - Adults 28-54, HHI $150k +, interest in outdoors, fine dining, and/or culture 2. Secondary Audience - Adults 55-64, HHI $150k+, interest in outdoors, fine dining, and/or culture Target Markets Market focus is based on historical visitation via surveys and website data. While similarities are often found between target audiences, recommendations are built on a review of each individual market, the target audience within it, and costs to ensure efficient relevance. Target markets for the 2018 media plan include: · Colorado · Los Angeles DMA · San Francisco DMA · Chicago DMA · Houston Dallas DMA P22 II. 9 · Santa Barbara DMA · Seattle DMA · Miami DMA New Markets Target new markets to promote first time trial and fill need periods in spring, late summer and fall. Target markets include: · Millennial Traveler without Children. · Target new visitors to consider Aspen for their summer mountain vacation. · Millennial Traveler with Children. · LGBTQ – continue efforts to position Aspen as an inclusive destination with Aspen Summer Holiday and paid media campaign, social media and public relations. International Marketing Strategy · Continue to develop and grow PR initiatives in UK, Germany and Mexico in collaboration with Snowmass Tourism. · Evaluate emerging markets and opportunities to collaborate with partners on international efforts. · Continue cooperative advertising of the Aspen Snowmass brand with Brand USA outlets. · Conduct sales missions in key markets – selling Aspen to travel trade. · Continued collaboration with Colorado Tourism Office to expose Aspen to international markets. · Production and distribution of international language brochures in key markets. · Host FAM participants for first-hand experience in Aspen. Social Media Position ACRA’s social media as the authority on Aspen across outlets utilizing the following strategies: · Provide suggested content to engage blog readers deeper into website, increase blog notification subscriptions. · Partner with local photographers to ensure most compelling photography. · Utilize social media advertising or boost posts when appropriate. · Monitor, promote and grow social shares of posts. · Continue video production and distribution to grow engagement. Group Sales P23 II. 10 Attract group business to Aspen with targeted sales and marketing initiatives generating one million dollars of revenue for the Aspen community. Strategies: · Focus lead generation on need periods. · Host qualified meeting and wedding planners at three annual FAM’s to provide a first- hand experience of Aspen. · Represent Aspen at trade shows and sales missions in key markets. · Implement a PR and social media campaign specifically highlighting Aspen as a year round destination for meetings and groups. Partnerships and Special Events ACRA is pleased to collaborate with our community partners on signature events and initiatives including XGames, Winterksol, World Cup, 12 Days of Aspen and other events. ACRA also partners with Aspen Skiing Company, Snowmass Tourism and Pitkin County on promoting and developing continued air service to Aspen. Destination Marketing 2018 Income Tax Revenue $2,650,990 Lodging Commissions $25k Coop Funds $65k Total $2,740,990 P24 II. 11 Destination Marketing 2018 Expenses 2018 Proposed Notes Reserve $90k $500k to be reserved by EOY 2019 Salaries/Benefits/Operations $649k 24% of Total budget Marketing $645k Advertising, Production, Print Collateral Travel/expenses $90k Sales and Marketing Team Trade shows & FAMs $110k Print/Distribution $40k Sponsorship $80 Public Relations $322k Domestic and International International Marketing $25k Web/Technology $141k Research $50k Economic Impact Study Photography $60k Seasonal Marketing $60k Spring and Fall Partnerships / Special Events $300k XGames, Air Service, Special Events Social Media $90k TOTAL $2.74M P25 II. 4770 Baseline Rd, Ste 360  Boulder, Colorado 80303  tel 303/449-6558  RRCAssociates.com 2017 ASPEN ARTS FESTIVAL RESEARCH EXECUTIVE SUMMARY Prepared for the Aspen Chamber Resort Association August 31, 2017 INTRODUCTION AND METHODOLOGY This report summarizes the results of attendee and vendor research regarding the visitor profile, estimated attendance, and economic impact of the Aspen Arts Festival, an event held July 22-23, 2017, in downtown Aspen, Colorado. The analysis updates a similar visitor profile and economic impact study that RRC Associates conducted on the event in 2014. RRC conducted an attendee intercept survey and crowd counts on both days of the event. A total of 85 surveys were collected, up from 47 surveys in 2014. The 95 percent confidence interval about a proportion for a sample of 85 is +/-10.6 percentage points. As documented in the report, many of the survey results in 2017 and 2014 were similar (as would typically be expected for a stable, mature event in a mature destination), adding confidence in the results. Additionally, a survey was distributed to participating vendors at the start of the event and collected at its conclusion. A total of 95 surveys were collected from the 122 participating vendors, a response rate of 78 percent. Both surveys included questions on demographics, selected trip characteristics, selected details of the visit to the Festival, expenditures, and evaluation of the event. EXECUTIVE SUMMARY Selected key findings from the 2017 Aspen Arts Festival research are summarized below. Attendance and Economic Impact • Total of 3,514 attendee-days. There were an estimated of 2,246 unique attendees on Saturday and 1,267 unique attendees on Sunday, for a total of approximately 3,514 “attendee days” across the two-day event. (These counts include leisure attendees P26 II. 2017 Aspen Arts Festival Research Executive Summary RRC Associates 2 only; vendors and event staff are excluded.) Based on manual counts, the average crowd size was approximately 370 on Saturday (peaking at 510 people at 11am), and 209 on Sunday (peaking at 290 people at 3pm). Visitors spent an average of 69 minutes at the event, implying that the crowd turned over an average of 6.1 times each day (across the 7-hour daily duration of the event). • Direct economic significance (i.e. trip-related spend) of $1.19 million. Attendees of the Festival spent a total of approximately $1.07 million in the Aspen/Roaring Fork Valley region during their stay, and exhibiting vendors spent an additional $121,000. • Direct economic impact estimated at $383,000. “Economic impact” refers to money brought into or retained in Aspen/Roaring Fork Valley as a direct result of the event. It is a narrower measure than “economic significance,” insofar as it takes into account the importance of the event in driving the decision to visit Aspen, and excludes arts purchases from vendors located outside the Roaring Fork Valley (as those economic benefits largely accrue outside the Valley). The direct economic impacts include $262,000 attributable to visitors and $121,000 attributable to vendors. Attendee Demographics, Trip Characteristics, and Satisfaction • Visitor demographics, trip characteristics, and satisfaction were largely similar in 2017 and 2014: As documented further below, the consistency of the findings tends to add confidence in the survey results, given the established nature of the Festival. • Eighty percent of attendees were from outside Aspen: Aspen residents accounted for 20 percent of respondents in 2017 and a similar 24 percent in 2014. Additionally, comparable shares each year were from elsewhere in the Roaring Fork Valley (10 percent and 7 percent respectively); elsewhere in Colorado (17 percent and 18 percent); out of state (51 percent and 47 percent); and foreign countries (2 percent and 4 percent). • Skew to older age profile: The age distribution of respondents was largely similar in 2017 and 2014, with a skew to older attendees (median age 59 in 2017, 56 in 2014). • Generally affluent attendees: This year, 22 percent of attendees had an annual household income of less than $100,000, 49 percent earned $100,000 - $199,999, and 29 percent earned $200,000+. • Steady share of overnight visitors: Sixty-two percent of respondents said they were staying away from their primary residence as part of their visit, similar to the level recorded in 2014 (66 percent). P27 II. 2017 Aspen Arts Festival Research Executive Summary RRC Associates 3 • Most stayed in Aspen or Snowmass: Among overnight visitors, about half stayed in Aspen (53 percent), while 31 percent stayed in Snowmass Village, 14 percent stayed down valley, and 2 percent stayed in elsewhere. • Most stayed in paid lodging: Most overnight visitors stayed in paid lodging (59 percent), including traditional paid lodging (43 percent) and rent-by-owner lodging (16 percent). The remaining 41 percent stayed in owned vacation homes (22 percent), stayed with friends/family living in the area (10 percent), used a tent or RV (6 percent), or stayed in employee/student housing (2 percent). • Even mix of first-time and repeat festival goers: Nearly half (47 percent) of respondents were attending the Festival for the first year, while 53 percent had attended before. Roaring Fork Valley residents were much more likely than out-of-Valley visitors to have previously attended (87 percent vs. 39 percent). • Most respondents were aware of the Festival before arrival (64 percent). Residents of the Roaring Fork Valley were more likely to be aware than visitors from outside the Valley (79 percent vs. 56 percent). Additionally, persons who had attended the event in past years were much more likely to be aware than persons visiting the event for the first time (89 percent vs. 33 percent). • How would you rate your overall experience at the Aspen Arts Festival? Using a scale where 1 = ‘Poor’ and 10 = ‘Excellent’, the average response was 8.4, similar to 8.2 in 2014. Most respondents this summer gave ratings of 8 to 1 0 (81 percent), indicating moderate to high satisfaction for the majority of Festival-goers. • What one thing could be done to most improve your experience at the Aspen Arts Festival? In open-ended comments, the most common suggestions were to have more shade/too hot, have more food and drink options, add live music, lower prices/increase the affordability of the art, have more places for attendees to sit, and change the mix of art (e.g. add a greater variety of art, have more art to the respondent’s taste). Exhibitor Demographics, Trip Characteristics and Satisfaction • Geographic origin. Thirty-five percent of responding exhibitors were from Colorado, 16 percent from Florida, 14 percent from California, 11 percent from New Mexico, 6 percent each from Texas and Arizona, and 12 percent from other states. • Previous attendance at Aspen Arts Festival. Forty-two percent of exhibitors were attending the Festival for the first time, while 58 percent had attended in previous years. P28 II. 2017 Aspen Arts Festival Research Executive Summary RRC Associates 4 • Art business as a source of income. Fully 79 percent of exhibitors said their art business was their primary source of income. Another 16 percent said it was a secondary source of income, while 4 percent said their business was a hobby or avocation and not essential for their finances. • Type of lodging. Most exhibitors stayed in traditional paid lodging (59 percent), while a significant 26 percent used an RV or tent camped/backpacked. Smaller shares used paid rent-by-owner lodging (7 percent), stayed with family/friends who live in the area (4 percent), or stayed in a vacation home/timeshare owned by them/family/friends (1 percent). • Location of lodging. The largest share stayed in Snowmass Village (44 percent), followed by Aspen (31 percent, inclusive of the base of Aspen Highlands and Buttermilk), down valley locations (24 percent), and elsewhere (1 percent). • Nights stayed in the area this visit. Exhibitors stayed an average of 4.3 nights in the area. Most stayed two to four nights (72 percent), while 26 percent stayed five or more nights, and just 2 percent stayed one night. • Aside from exhibiting, are you experiencing leisure/pleasure activities while in Aspen (e.g. sightseeing, recreation, entertainment, etc.)? Respondents were evenly split, with 51 percent participating in leisure/pleasure activities and 49 percent not. • Has your sales revenue/business performance at the Aspen Arts Festival met your expectations? While 12 percent said their performance exceeded their expectations and 27 percent said it met their expectations, a larger 54 percent said their performance did not meet their expectations. Another eight percent were still uncertain about their performance. • How likely are you exhibit at next year’s Aspen Arts Festival? On a 10-point scale where 10=extremely likely and 1=not at all likely, the average response was 6.6. Thirty-seven percent responded 9 or 10 (highly likely), 21 percent responded 7 or 8 (moderately likely), and 42 percent responded 1 – 6 (low likelihood). Respondents who said their sales expectations were exceeded or met were highly likely to return (average likelihood 9.3), while those who said their sales expectations were not met were much less likely to return (average likelihood 4.6). In comments regarding their likelihood of return, exhibitors frequently touched on their business performance and crowd volume as key considerations. P29 II. Destination: Aspen Period: Bookings as of Aug 31, 2017 Data based on a sample of up to 18 properties in the Aspen destination, representing up to 1,529 Units ('DestiMetrics Census'*) and 73.1% of 2,091 total units in the Aspen destination ('Destination Census'**) a. Last Month Performance: Current YTD vs. Previous YTD 2017/18 2016/17 Year over Year % Diff 72.0%75.4%-4.4% $396 $377 5.0% $285 $284 0.4% Occupancy 2017 Occupancy 2016 Absolute % difference Year over Year % Diff 76.4%79.1%-2.7%-3.4% b. Next Month Performance: Current YTD vs. Previous YTD 53.5%52.7%1.6% c. Historical 6 Month Performance (March to August): Current YTD vs. Previous YTD. 60.4%61.3%-1.5% $415 $393 5.6% $251 $241 4.0% d. Incremental Pacing - % Change in Rooms Booked last Calendar Month: Aug. 31, 2017 vs. Previous Year 6.8%8.5%-19.3% Copyright 2006 - 2017 Sterling Valley Systems. All Rights Reserved. Information provided here is CONFIDENTIAL INFORMATION and is expressly not for reproduction, distribution publication or any other dissemination without the express written permission of DestiMetrics. Data and Metrics represented on this report are representative of the Sample Properties only and may not be representative of the entire Community or Industry. Persons using this data for strategic purposes do so at their own risk and hold DestiMetrics harmless. Rooms Booked during last month (August, 2017) compared to Rooms Booked during the same period last year (August, 2016) for all arrival dates has changed by (-19.3%)Booking Pace (August) * DestiMetrics Census: Total number of rooms reported by participating DestiMetrics properties as available for short-term rental in the reporting month. This number can vary monthly as inventories and report participants change over time. ** Destination Census: The total number of rooms available for rental within the community as established by the Aspen / Snowmass Transient Inventory Study restatement of May 2015 and adjusted for properties that have opened / closed since that time. This number varies infrequently as new properties start, or existing properties cease operations. Aspen RevPAR for the prior 6 months changed by (4.0%)RevPAR Aspen Paid Occupancy Rate for the prior 6 months changed by (-1.5%)Paid Occupancy Rate Aspen Average Daily Rate for the prior 6 months changed by (5.6%)ADR Aspen RevPAR for last month (August) changed by (0.4%)RevPAR (August) Aspen Paid Occupancy Rate for next month (September) changed by (1.6%)Paid Occupancy Rate (September) Last Month Performance Total Paid & Unpaid Occupancy Aspen Average Daily Rate for last month (August) changed by (5.0%) ADR (August) RESERVATIONS ACTIVITY REPORT Aspen Executive Summary Aspen Paid Occupancy Rate for last month (August) changed by (-4.4%)Paid Occupancy Rate (August) 9/13/2017 Copyright (c) 2006 - 2015, DestiMetrics, LLC All Rights Reserved. Confidential Information not for reproduction and protected by law. info@destimetrics.com www.destimetrics.com 1 P30 II.