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Home My WebLink About2013-07-16; City Council; 21300; Exploring Corporate Sponsorships and PartnershipsCITY OF CARLSBAD - AGENDA BILL AB# MTG. DEPT. 21.300 -7/16/13- COMM. PRESENTATION BY STAFF EXPLORING PUBLIC - PRIVATE CORPORATE MARKETING SPONSORSHIPS AND PARTNERSHIPS DEPT.DIRECTOR CITYATTY. CITY MGR. RECOMMENDED ACTION: If the City Council is interested in exploring a new program to seek corporate marketing sponsorships and partnerships, direct staff to: • Develop a "corporate marketing partnership" policy to ensure proper guidelines are in place to comply with the law and to ensure the program is consistent with community values. • Engage a contractor with expertise in developing corporate marketing partnership programs to prepare the necessary requests for proposals and assist the city in negotiating specific agreements for consideration by the City Council. • Begin with the first two programs listed below (proud partner program and vending) in the first year of implementation. Once results of those programs are known, seek direction to implement one or more ofthe additional programs (public recyding, sponsored WiFi and "MyCityDeals") described below. ITEM EXPLANATION: "Corporate marketing partnerships" is an umbrella term to describe a variety of programs that enable corporate entities to support city programs, events and services while generating exposure for their brands among city audiences. Marketing partnerships have been common in the corporate and non profit sectors for many years. In the public sector, transit agendes have an established practice of marketing partnerships as well. More recently, the concept has gained popularity among municipalities. Potential opportunities City staff hired a consultant, Active Network, spedalizing in corporate marketing partnerships for munidpalities to assess possible opportunities for the City of Carlsbad. Based on this research, the following programs are recommended for further exploration, listed in order of priority: "Proud partner" program Under a "proud partner program," the city would package key city events, such as TGIF Jazz in the Parks, with other programs (Adopt a Trail, Triathlon, aquatics programs, fadlity naming rights, etc.) in customized public/private sponsorships packages. The dty would then negotiate with interested companies for a set of rights and entitlements, such as signage and use of the company logo and a "proud partner of the City of Carlsbad" tag line on city printed materials. The city would prepare a DEPARTMENT CONTACT: Kristina Ray, city communications manager, 760-434-2957 or kristina.ray@carlsbadca.gov FOR CLERK USE. COUNCIL ACTION: APPROVED • CONTINUED TO DATE SPECIFIC • DENIED • CONTINUED TO DATE UNKNOWN • CONTINUED • RETURNED TO STAFF • WITHDRAWN • OTHER - SEE MINUTES • AMENDED • REPORT RECEIVED • regarding marketing partnerships (See Minutes for details). request for proposals targeting local companies as well as national brands. Once negotiated, each proposed partnership arrangement would be presented to the City Council for approval. The proud partner program is very flexible, allowing the city to present opportunities to a wide variety of companies that could be interested in a single opportunity, such as facility naming rights, or a package of opportunities that includes programs and events. Beverage and snack vending The city currently takes a decentralized approach to food and beverage vending, with various departments and groups contracting for this service with different companies. This program would centralize all vending with an exclusive vendor contract (e.g., Coca-Cola, Pepsi, Canteen, Snapple) that would deliver guaranteed revenue streams and value-added programs that benefit the community (such as donated bottled water for city events). To ensure the proper fit with Carlsbad community values, staff recommends adopting a "healthy beverage and snack" criteria as part ofthe vending contract, meaning a certain percentage ofthe offerings must be low calorie and/or low sugar. To implement this program, the dty would prepare and distribute a request for proposals to vending companies and bring forward a recommended contract for the City Council's review and approval. Public recycling A public recycling program would generate revenue while promoting sustainability and allowing local businesses to gain exposure in the community. This program involves installing recyde bins with built in advertising space at high traffic locations throughout the city. Revenue is generated by sales of local business promotion tactfully displayed on the sides of recycle bins. They would only be placed where dty staff already collects trash (beach sea wall, parks. Village). City staff or contractors would be expected to maintain the bins and collect the recyclables. Revenue generation would be offset by this cost. Bin locations could be chosen based on locations where city staff already service trash bins to minimize additional workload. Online advertising Two other programs were identified by the consultant for consideration. Both involve creating new opportunities for local advertisers. • A sponsored WiFi program would create a closed WiFi network in high traffic areas of the city to drive customers to local businesses and promote city events and programs. Within each WiFi service area, people with WiFi enabled mobile devices (phones, tablets, laptops) would receive a notification of the availability of the network. When they access the network they would receive special promotions from local companies and information about city programs, services and events. This connection is not a traditional WiFi network providing access to the Internet. It only provides access to the sponsored content. With Carlsbad's large visitor base, this program could provide a new advertising channel for local restaurants, shops and other businesses, as well as "local deals" for residents. Since the city would be sponsoring the connection, it would share in advertising revenue with the company providing the network. • A "MyCityDeals" coupon program, similar to Groupon. The city would engage with a third party vendor to develop and manage an online "MyCityDeals" program that features an interactive daily deal site (hosted separate from the city website, displayed as a splash page on the city's website. The site would provide daily deals promoting local businesses. The city would engage in a revenue sharing agreement with a third party vendor who would manage the program and solicit advertisements. Considerations Staff recommends first creating a policy outlining parameters for potential partners to ensure they are not in conflict with community values (types of companies) and that the program is in line with community aesthetics. Also partnerships should be designed to complement not compete with groups that already provide revenue for city programs, such as Friends ofthe Library, Friends ofthe Arts, Carlsbad Library & Arts Foundation and Friends of Carrillo Ranch. Staff further recommends offering category exclusivity; meaning only one partnership would be available per industry (financial Institutions, automobile manufacturers, sports companies, etc.). Typically, longer term contracts, three to five years, are more lucrative and require fewer resources to administer, than shorter contracts. FISCAL IMPACT: Active Network, a consultant with nationwide experience developing and implementing corporate marketing partnership programs, has evaluated City of Carlsbad assets, such as special events, programs and public facilities, and estimated that the City of Carlsbad could expect to generate between $375,000 to $750,000 in new, ongoing annual revenue within three years of launching such a program. This estimate is the net revenue. It is assumed that the city would hire a consultant to develop the programs and assist with negotiating partnership arrangements, working on a commission only basis. City staff would administer the contracts using existing staff resources. The revenue figures are based on the number of people who could be reached and the estimated value of that advertising "reach" in the sponsorship marketplace. Actual revenues would be determined following the successful completion of each program's request for proposals process and the subsequent contracts negotiated by staff and approved by the City Council. ENVIRONMENTAL IMPACT: Pursuant to Public Resources Code Section 21065, this action does not constitute a "project" within the meaning of CEQA in that it has no potential to cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, and therefore does not require environmental review. EXHIBITS: None. Corporate Marketing Partnerships July 16, 2013 Today’s Presentation •Background and history •Opportunities for Carlsbad •Policy considerations •Recommended next steps History and Background •Non profit sector •Transit •Municipalities 3 Why Partnerships? •Generate new ongoing revenue •Create relationships with businesses, other partners •Make the most efficient use of taxpayer resources 4 What We Are NOT Recommending 5 Sample Partnerships 6 7 8 9 10 11 Naming 12 Naming 13 Opportunities •Present “packages” rather than individual events/programs •Create long term relationships •Generate increased revenue •Reduce “asks” to potential partners •New areas 14 Opportunities •Vending •“Proud Partner” program •Recycling •Online advertising 15 Vending 16 Proud Partner 17 Recycling 18 WiFi 19 My City Deals 20 Policy Considerations •Objective criteria for selecting partners •No preferential treatment, endorsement •How partners will be recognized •Protection of community aesthetics •Complement efforts of friends groups, other efforts 21 Recommendation •Develop a “corporate marketing partnership” policy to ensure proper guidelines are in place to comply with the law and to ensure the program is consistent with community values. •Engage a contractor with expertise in developing corporate marketing partnership programs to prepare the necessary requests for proposals and assist the city in negotiating specific agreements for consideration by the City Council. •Begin with the first two programs listed below (proud partner program and vending) in the first year of implementation. Once results of those programs are known, seek direction to implement one or more of the additional programs (public recycling, sponsored WiFi and “MyCityDeals”). 22