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Home My WebLink About6/18/2001 - STAFF REPORTS N f Strategic � I Marketing Report r MM!/1NI '" M■4VM1'Ln•�ro!' �., �.„.. .. June 18, 20'T01 Assignment :Tv l'Gd %ide•xhe, i q o -Pa_jm,'Sp�ing,,6fr' Behalf Af.the`AirPbrt,a';Cortt rehens,Ahe 'M66 ketind_S rstegy 39I'l l irtig; + , Aiir,6ei`viee Malketinlg �. ■ 'T 1e O&D,PaNengar. . '■`L6cal Adri'tising,a7d. , /l`arketi'hg t i Vacant Land I4arketrng�' ;, '■' F Z IWIa'tketiWg ■' Ciast6fn6 0cility Ma efing t y ,; A :ucc �s / 3frteic N1agkNJ i'PIa je ,.' fo►,,Palm,S&in'gs,interOatlor►al AirpodJnvo1ves a C3 ordinal d and &;i ipreh1 .9"ive A*roach Overall Objectives ■ To Maximize the Utility of Palm Springs International Airport ■ To Increase Air Service Options for Residents and Visitors ■ To Raise Awareness of Palm Springs International Airport Among Target Audiences: — Local Communities and Residents, Air Carriers, Media,Visitors, Business and Industry, and Private Aircraft Operators A Strategic Approach to Airport Marketing Community Target Audiences Visibility 0 Local Residents Advertising Businesses Business/Leisure Inbound/Outbound Distant -Markiating- Air Service Advertising Development Incumbent Potential t Palm Springs Project Approach 1 11 'f�Mtlnth I '"`-I< `f� �Montfi 21 r+ r'P 'a MontW8v* ,f t rPJ t pm'a ', e� e, Kemk��eenng„ r nK� 1. rt, TaUI 'Project Initiation&,Styd�y7; - .� Revievy- Task 2 l;1l arch,,Market blysJs ea'"art`meJnU3tldns',FidR" `' t" Pkpoff'&kesentatfotr':t ww�wur.- SH&E Conducted Four Days of On-Site One-on-One Meetings with Key Constituencies of Palm Springs International Airport ■ Two Day Kick Off Meeting Held,in,February 2001 - City of Palm Springs--City Manager, Economic Development Director,Tourism Director, Redevelopment Authority — Airport Management ands Key Consultant — Palm Springs International Airport Station Managers and Customs Agent — Members of the Airport Commission — Airline Task Force — Convention and Visitors Authority — Palm Springs Chamber of Commerce — Individual Hoteliers — Travel Agents — Area Publishers — Casino Operators �r71, r ' ra r +i w Palm Springs Survey Methodology and Results Palm Springs Ticket Lift Survey Methodology and Results ■ Eight Travel Agencies Participated in the Study — A Total of 26 Agencies Were Contacted ■ Two Sample Periods were Collected from Each, Agency: AugusUSeptember, 2000 and February/March 2001 — 2,600 Tickets Collected and Analyzed ■ The Sample Recorded and Analyzed the Following Information: , — Passenger's Full Itinerary (Airport Utilized) — Fare Paid — C Palm Springs International Airport Enplanes Over 43% of its Local Area Passengers (Outbound) Percent of Coachella Valley Air Travelers by Airport Used Los 65 Irrt°I pll OtheC `' .12,7b/,n_ Source:SH&E Travel Agency Survey,2001 All Other includes,Orange County,San Diego,Santa Barbara,Las Vegas,Burbank,Tijuana Palm Springs Inbound Visitor Survey Methodology and Results ■ Hotels Participated in the Survey ■ 400 Responses Collected and Analyzed ■ The Sample Recorded the Following Information: - Mode of Travel (Car, Private Plane, Commercial Airline) - Origin and Destination - Carrier Flown - Nature of Trip (Business, Leisure, Combination) - Number of Flights Breakdown of Airport Used by Passengers Who Flew San Diego Other No 1.8% 1.8% Answer III 1.8% Ontario II 9.9% Los,Arigele�7' f7.5°!° ` ` Mode of Travel of Incoming Visitors to Palm Springs Private Bus Aircraft 0.2% 2.5% Aire.. 42AF/e Source.SHBE Inbound Visitor Survey,goal According to the Palm Springs Ticket Lift Survey Results and the Inbound Visitor Survey Demonstrate the Palm Springs International Airport Market is Over 2 Million Passengers n,"nq.r 1R+w,q4,•- s".q.4,. . IK.r:C1 Norih kinerdgarC r YE�Qr29QQ �r' ;0I }nr ReporCed Sn ,Reported s O$D Syassen t'ri,204,a p- ^ OAD Nassels r 1,zOdrySg %OrOnadl,.'9 from Pa7fn springs, I era )M- F rJ 1 p..t 1'94 t o,%6 PasSdrl Sir 'f i ••.�.'.,% '00 Pat dh Lira ',Origiirating f }- PalmAprings;#- _„ 30d, P91Mspririg%+ 898;�F6 Leakage Rate From { I ' y' `Leakage Rate-rp'otn` : . Travel elAyemrvey y,y7�g%. Travel, oysurvey f.8% .� ;Ma et ., ?j ,..- i�'; ;.Mar t ;ly, #, , ,.. : P. Adj , "Adu3f�d ibi" AdJus'fed N ' - Le�kager Total Market Size Adjusted for Potential Passengers: 2,042,681 After Weighted Adjustments for Inbound and Outbound Passengers, Palm Springs' Top Markets Include: YE 30 2000 OSO Pax AL1ns@tl 0&0 040 Percent of Rank Markets Coca Passengers Total 1 Seattle SEA iswn wA 2 San Francisco SFO 190M ] /e 3 Newyork NYC l6 SSA 4 Portlantl PDX OEM 411"'A 5 Chicago CHI 91 4 A 6 Las Vegas LAS 61•,376 TPA ] San Jose SJC 6045, WA S Oaklantl OAK 5134 2 A 0 Phoenix PHX vim! VI 2 k 10 Va ncoever,Canada WR 52619 MA 11 Los Angeles LAX 9.3;zms �A 12 Sacramento SAC mom 2 A 13 Dallasi Worth DFW 39M �A 14 Minneapolis MSP 311111,30 1.9l4 15 Denver DEN 30r255 1 k 6 Washington WAS 31$I4 1LSYe i] Boston 305 zs, fMA 18 Detroit DTT 279. 9 A 19 Baltlnipre Ei 251Ti6 "A 23 Atlanta ATL D I 1`.X� Top 20 Tctal 1,28IV7 ] 63 A Other 750251 3] Tula I 2 047,681 10L During the Peak Season, Palm Springs Currently Serves 13 Nonstop Markets With a Total of 60 Daily Nonstop Departures February 2001 • Se2nieRacoma (3) Portland 19 Minneapolis • 11) Sall Lake Cary Chicago ORD San Francisco (1) (2) (5)• Denver Sonja 11) /egas Los Angeles 11) (33) PSP Phaenix (]( OallaslFt.Worth (3) Houston IAH Source,OAG Schedule Tapes,February 2001 (1) While in the Non-Peak Season, Palm Springs Serves 5 Nonstop Markets With a Total of 31 Daily Nonstop Departures August2000 San Francisco Las Vegas (3) Los Angeles /• (16) PsP Phoenix Dallas/Ft.Worth (1) Source.DAe Schedule Tapes,August 2000 Palm Springs' O&D Growth Outpaces Other Small Hubs Averagenu�l G{o�vth Y995�YEI720150f Millions 1.2 T AV AIfS•mall'Hrds, 2 / U.e�pvg fall . :� •i. 3.5%q — — — 0.8 0.6� r,- y 0.4 0.2 r a •�e �,,, ..en.,. ., nF.a >. •Mo- 1990 1991 1992 1 3 1994 1986 11996 1997 1999 1999 YE3Q 2000 Source:Database Products Growth is Occurring in the Central and Pacific Regions of the Average Annual Gro t ,1996-YE 3Q 2000 -Mo,pntajn Y,4% Ce�nt I' l Y34% ' Olieat'ILakets-'. M Nchhe$st' ,f Pilicifio, _. - . 4.2% Solhe�st_, 3.8% ;., Fjoridp ,-, . . QthpPn 1.5% Source Database Products ' Palm Springs' Reported Top Markets Are Spread' Throughout the U.S. pp Top 20 US O&D Markets for Palm Springs ��^tltits" Vancouver YE 3Q 2000 �R SeattlelTacoma O'Portland Boston Sacramento Mmneapohs ® ® New San Francisco Detroit York Denver Chicago AAAttt... Oakland �Baltimore San Jose 6'Las Vegas Washington DC Los Angeles Atlanta Phoenix DallaslFt Worth rSeasonal NonatM SitrvbL� Note Service Based on Calendar -0-YaarfVou1%i Noht 60SenricC- Year 2000 Schedules • No Nonst erm� ce Source LSDOT,C&D Survey v �r ' n s.l.i U, Regional Jet Analysis The Two Largest Uses of Regional Jets Are Complementing Existing Jet Routes and the Development of New Routes Turboprop Replacement 8% Turboprop +A Complement 11% New Route„ Jet Replacement Source-Bombardier Regional Jets Offer Pain Springs the Ability to Access Major LIS Markets, Many of Which Are Connecting Hubs Seattle,Dallas/Fort Worth and Houston Are on the Regional Jets'Cusp 'seanle comana 1,000-Mde Radius ' Cltq' ' tlj�tJncE' ' Salt Lake City r Pair San Franusca PBPSEA 988- carver 'PSP.bFW 1,123, Lasveaas PSPPOVI 1,269 ' l Las Angeles PSP anoenla NllasrFt worts aoostan Source Maptltude Assessment of Potential New Services at Palm Springs ■, What are S?MITMETMications for Carriers? ■ Does the Carrier Have the Right-Sized Equipment? ■ Are Similar Sized' Markets Served? ■ Is the Market Feasible, Can the Carrier Make a Profit? ■ What is the Opportunity Cost for the Carrier? Airlines Are Receptive to Community Marketing, Efforts for New Service with Solid and Credible Market Research ■ Well-Developed Understanding of the Airport Market Area ■ Realistic Objectives for New Service ■ Market Analysis Based on Methodologies Acceptable and Persuasive to Target Carriers ■ Establishment,of Direct Contact and Relationships with Existing Airlines Service the Airport and with Prospective Airlines Air Service Development Strategic Recommendrations for Palm Springs International Airport ■ Regularly Update Data Regarding the Airport Market Area -- Socioeconomics, Demographics, Convention Numbers ■ Track Industry Trends to Proactively Assess How They May Affect Palm Springs International Airport -- Regional Jets ■ Maintain Databases on Existing,Service Performance -- Load Factor, Revenue,Yield, Fare, Completion Rates, On Board Passengers and 0&D Passengers, Largest Connect Markets, Market-Growth Rates -- and Benchmark Them Against Relevant System Averages and Comparable Communities Across the U.S. ■ Assess Realistic Objectives for New Service -- Monitor r Air Service Development Strategic Recommendations for Palm Springs International Airport ■ Attend Key AAAE and ACI Events with Purpose of Learning from Other Communities and Meeting with Airline Decision Makers ■ Present Economic Case to Carriers with Analysis Based on Methodologies Acceptable and Persuasive to Target Carriers - - Relevant Data, Forecast Methodology, Strategic Opportunity ■ Regularly Communicate with Incumbent and Target Carriers with Timely and Relevant Data ■ Continue Direct Contact and Relationships with Airlines and Establish Direct Contact with Prospective Airlines and All Tenant Carriers Air Service Development Strategic Recommendations for Palm Springs International Airport ■ Update Leakage Study and Inbound Visitor Study on Regular Basis — Every 1 to 2 Years Depending on Service Changes ■ Focus on Attracting Year-Round Service to Key Hubs and Major d&D Points — Chicago, Denver, Houston, Seattle, Portland, San Jose .F i t t �F Advertising, Marketing and Publicity The City of Palm Springs Needs a Proactive Strategy to Market to the Valley's Local Travelers ■ Airport Needs to Implement a Proactive Publicity Initiative ■ Advertising Should Be Limited to Highly Targeted Audiences and Messages ■ Single Spokesperson Should be Identified and Media Trained as.the "Official Voice" of the Airport and Airport Related Issues ■ Key Messages Should'Be Developerli and .Communicated . to Target Audiences on a Regular Basis ■ Community and Civic Events Should Be Identified Merchandize News Initiatives with Targeted! Organizations and Individuals ■ Send Copies of All News Release, Articles, Interviews With Cover Letter to -Travel Agent -Hotel Managers and/or Marketing Directors -Business and Travel Organizations (Suggest They Include Information in Their Newsletters) -Convention and Visitors Authority -Individual City Travel Officials- -Cham,bers,of Commerce -Academic Institutions Increase Visibility In Local Community ■ Join and Regularly Attend Civic and Travel Organizations - Identify Speaking Opportunities and Committee Assignments -Host Meetings at Airport - Identify Community Projects to Sponsor and/or Participate -Consider Hosting Event at Airport -Offer Airport Tours to Key Organization Work Cooperatively With Organizations Marketing to Inbound Traveler ■ Attend Trade Shows and Conferences With CVA and City Travel Officials ■ Provide Organizations With Up-to-Date and Informative Collateral Materials ■ Offer to Host Tours and Venues for Events for Marketing Visitors Improvements Will Make the Current Website More Effective ■ Establish New Domain Name That Makes it Easier to Access Site ■ Consider Improving Links to and from Related Sites ■ Create a "News" Section That Regularly Provides a Visitor to the Site New Travel Related News -- This Will Create a Behavior of Regular Visits to the Site ■ Add a Section of "Travel Tips" ■ Encourage Carriers to Post Information on the Site ■ Update Graphics and "Key Messages O C, ++ CLN O lA rCD 4sZ t` Q - �_ � 0.t � D 40 ' .. 2 t0 A A4 O H grade Zones Are Designed to Benefit BusiR��f'hat Import or Export Goods ■ Customs. Duties and Federal Excise Taxes Are Deferred Improving Cash Flow ■ No Duties on Goods Re-Exported from an FTZ ■ Foreign and Domestic Goods Held for Export Are Exempt from State an,d Local Inventory Taxes ■ If Finished Pro Have Lower Duty Rates than Their Imported Components, the Importer May Pay Duties at the Lower Rate There Are 233 U.S. Foreign Trade Zones Including Seven in the Los Angeles Region mommiIii It Witt Be Very Difficult for PSP to Attract International Air Cargo Despite Having an FTZ ■ Besides LAX, Four Other Airports in the Region Are Competing for International Cargo: Southern California Logistics Airport (SCLA), San Bernardino International, Ontario and March — These Airports Are Located Closer to Most LA Area Businesses That Use International Air Cargo Services — Ontario,Offers Scheduled All-Cargo Service to Asia„ Southern California's Largest Trading Partner — Ontario, San Bernardino and,March Offer Better Highway Access Than PSP—N-S As Well As E-W — SCLA and George Have FTZs;Ontario is a Port of Entry and Entitled to an FTZ The Airport Should Play a Supporting Role in FTZ Marketing, Not the Leading Role ■ The Palm Springs FTZ Should Be Viewed Primarily as an Economic Development Tool, Not an Airport Development Tool ■ It Can Help Attract Business With or Without International Cargo Service at PSP a FTZ Marketing Will Be Most Effective When Coordinated With Other Economic Development Activities YYr Ail �S lV .y 7" e Customs Marketing U.S. Customs Service Should, Be Highlighted by Palm Springs International Airport and FBOs ■ Private Aircraft from Canada and Mexico Make Up the Majority of U.S. Customs Activity at Palm Springs International Airport r Ccliaboraikk Marketing Efforts by Palm Springs Irternatio" ,4irport and, FBOs to Demonstrate Palm Sprkxys hternational Airport's Ability to Handle HigIvEnd Private International Aircraft Seeking Ass to Southern California.Should Be Explored Customs Facility Marketing Recommendations ■ Contact Canadian Tour Operators and Charter Carriers for Meetings ■ Partner with FBOs on Marketing Piece for Private Aircraft Operators and Owners ■ Contact U.S. Customs and Immigration for POE Costs a� Vacant Land Marketing Key Marketing Characteristics of Palm Springs International Airport Vacant Land ■ There Are Several Hundred Acres of Property Available for Both Aviation and Industrial Use ■ The Airport is Located in, Close Proximity to the City of Palm Springs ■ The Landi Offers Good Access to Major Interstate Highway (Hwy 111) Vacant Land Marketing, Recommendations ■ Coordinate Marketing Effort With City of Palm Springs Economic Development Marketing Initiatives ■ Create an Updated Marketing Brochure Which Encompasses All Vacant Land Options and Features Land Attributes ■ Conduct a Direct Mail Campaign to Targeted Businesses and Organizations: - Area Commercial Real Estate Brokers - Regional Industrial and Commercial Businesses P Conclusion ■ The City of Palm Springs Has Built a Strong, Foundation for Developing Additional Seasonal and Year-Round Air Service for the Region. ■ Moving Forward Emphasis Should Be Placed on Two Key Priorities: — Proactive Marketing to Current and Prospective Air Carriers — Raising Awareness and Support from,,Local Communities