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Home My WebLink About6/19/2013 - STAFF REPORTS - 2.F. VALM Sp c V N P HC4bEP}EO °Q<-F.0.It CITY COUNCIL STAFF REPORT DATE: June 19, 2013 CONSENT CALENDAR SUBJECT: APPROVE AN AGREEMENT WITH THE BUXTON COMPANY OF FORT WORTH, TEXAS TO IMPLEMENT THE RETAIL RECRUITMENT AND TOURISM PROFILE SOLUTIONS IN THE AMOUNT OF $68.000.00. FROM: David H. Ready, City Manager BY: Community & Economic Development SUMMARY The City has used The Buxton Company of Fort Worth, Texas since 2004 to analyze the community's retail and visitor demographics and purchasing preferences. In 2011, Buxton undertook an innovative study of visitor profiles and selected Palm Springs for the exclusive pilot program. The pilot study analyzed consumer level retail sales expenditures for nine retail spending categories from across the U.S. The study was for a 12-month period and totaled approximately $200 million in consumer spending, approximately 25% of the retail transactions in the City. Buxton has proposed that the City refresh its data for retail recruitment purposes, and update the tourism profiles to identify the top dominant markets visitors come from, including purchasing habits and preferences. The new data will be used for retail retention, expansion and recruitment and the tourism profile will help the Bureau of Tourism's specific marketing strategies. One benefit is the accessibility of actual visitors at the zip+4 levels, meaning that Tourism or other marketers can reach high propensity visitors at the level of 4-to-15 households. RECOMMENDATION: 1. Approve the Agreement with the Buxton Company in the amount of$68,000. 2. Authorize the City Manager to execute all necessary documents. STAFF ANALYSIS: Buxton's Retail Recruitment study has provided the City an understanding of its retail economic conditions to retain and recruit retailers to Palm Springs for the past nine years. It provides the City analytical information retailers depend on to make site selection decisions. It provides existing retailers with analytical information to help with their expansion plans and customer purchasing preferences. ITEM NO. City Council Staff Report (June 19, 2013) -- Page 2 (Buxton Agreement) The Tourism Profile Solutions is a new program Buxton developed with their exclusive relationship with VISA to identify the origin and household types of visitors coming to a city. This tourism data captured consumer level retail sales expenditures summarized by zip+4 for nine (9) retail spending categories from across the U.S. This provided insight into the most important tourist groups with an extremely high Palm Springs affinity index. The objective of the initial study was to identify, quantify and prioritize "who" Palm Springs Tourist consumers are and "where" they come from. The data collected suggested that the visitors to Palm Springs come from 152 of the 210 dominant market areas (DMAs) in the U.S., an impressive geographic reach. More specifically, 80% of overall retail sales dollars come from five DMAs — Los Angeles, Seattle-Tacoma, San Francisco-Oakland-San Jose, Portland, and San Diego. In terms of visitor characteristics, the study revealed that 58% of Palm Springs' tourist dollars come from just ten (10) primary customer segments (out of 61 segments). Included was the finding that 13% of the total retail transactions in the City come from a single customer segment— "America's Wealthiest." Buxton's Media Preference Analysis will allow the City to understand what motivates prospective visitors to come to Palm Springs by understanding the influence of each media type. The City can now identify geographically consumers with an affinity to Palm Springs and drill down to zip+4 (4 to 15 households) for direct mail marketing. Social media is another avenue that could be utilized to reach consumers at a zip code level. The Media Preference Analysis provides a means to reach visitors in a cost effective focused manner, and guide tourist marketing dollars and improve marketing ROL Buxton holds the largest repository of household level information in the United States. Recently, Buxton expanded their services with the exclusive relationship with VISA to conduct more expansive research in conjunction with their existing analytics system. Access to all of the data is provided though Buxton's proprietary Scout System, allowing the City to generate reports and maps on any geography in the United States. Reports include but are not limited to: demographics, psychographic profiles, retail supply and demand estimates, and consumer propensities or affinity for nearly 5,000 product and service types. The Scout System is also used to identify at a zip code level (and zip+4 levels) the geography of the visitor with a high affinity to Palm Springs. 02 City Council Staff Report (June 19, 2013) --Page 3 (Buxton Agreement) FISCAL IMPACT: The total cost is $68,000, which includes a refresh of retail matches; the Tourism Insights Study; a 12-month subscription to the Scout System; and direct mail or email list rental. 1. $45,000 will be paid from the current fiscal year Economic Development Department budget from two Accounts: 001-1400-65110 and 001-1400-65232. 2. $23,000 will be reimbursed from the Palm Springs Bureau of Tourism. Jo n Ra on irector Cathy Va Horn, Administrator C mmu ty & onomic Development Community & Economic Development David H. Ready, City r Attachments: Buxton Proposal 03 City of Palm Springs Retail Recruitment Refresh and Tourism Profile Solution Prepared by: Lisa Hill Expiration Date: June 7, 2013 Section 1: Scope of Services Section 2: Fees, Tilting, and Signatures Appendix A: Additional Recommended Solutions w 2651 South Polaris - Fort Worth, TX 76137 .: 04 City of Palm Springs Retail Recruitment Refresh and Tourism Profile Solution Prepared by: Lisa Hill Expiration Date: June 7, 2013 Section 1: Scope of Services Section 2: Fees, Timing, and Signatures Appendix A: Additional Recommended Solutions PolarisBUM 2651 South - Fort Worth, TX 76137 .: 04 City of Palm Springs Retail Recruitment Refresh and Tourism Profile Solution Prepared by: Lisa Hill Expiration Date: June 7, 2013 Section 1: Scope of 'ervices Section 2: Fees, Tir, ig, and Signatures Appendix A: Addition Recommended Solutions BU`sCOIY 2651 2 SouthPolarisDrive Fort Worth, TX 76137 .: 04 Section 1 — Scope of Services Buxton is pleased to present this proposal to the City of Palm Springs. The purpose of this proposal is to outline and review how Buxton's solutions will enhance your ability to effectively meet your strategic development objectives. City of Palm Springs Primary Objectives 1. Provide Retail Recruitment Site Refresh:The City of Palm Springs wants to understand its retail economic condition to allow them to recruit new retailers and retain current retailers on one(1) site to be specified by City of Palm Springs. 2. Understand Potential Visitors to City of Palm Springs:The City of Palm Springs wishes to identify characteristics of their existing and potential Palm Springs visitors. 3. Determine Media Preferences:City of Palm Springs wishes to utilize the customer profile to identify the media preferences of potential visitors to City of Palms Springs. Buxton's Solution Retail Recruitment Site Refresh Our Retail Recruitment solution is a total marketing strategy that enables community leaders to immediately implement a retail development program. It provides the same analytical information retailers depend on today to make site selection decisions so that you will have a compelling case as to why the City of Palm Springs can support new store and restaurant locations and expansions. Buxton will provide a refresh of a site that City of Palm Springs will specify. Tourism Solution Buxton will utilize our exclusive relationship with VISA to identify the origin and household-types of visitors to City of Palms Springs. City of Palms Springs will have a comprehensive view of likely visitors from households living outside and within the trade area. The deliverables for this solution include an executive summary and a workbook detailing all statistical data. This model will act as the engine to answer the following questions that will greatly assist in the development of the long-term strategic development plan: • Who Palm Springs' best visitors are • Where those best visitors live—and the means to reach them • The goods and services they consume while visiting Palm Springs Media Preference Analysis Buxton's Media Preference Analysis will allow City of Palm Springs to understand what motivates their prospective visitors to come to City of Palm Springs more often by better understanding the influence of each media type. All too frequently, marketing media is purchased based on the perception of who the customer is, as opposed to reality. Buxton's Media Preference Analysis, utilized in conjunction with the insights from City of Palm Springs'Tourism Solution,will ensure City of Palm Springs is making media purchases based on the reality of who their customer is and the most effective means of reaching them. This will make media buys and promotional efforts of all types more cost effective. Btraon Page 1 2 05 Section 1 — Scope of Services Buxton is pleased to present this proposal to the City of Palm Springs. The purpose of this proposal is to outline and review how Buxton's solutions will enhance your ability to effectively meet your strategic development objectives. City of Palm Springs Primary Objectives 1. Provide Retail Recruitment Site Refresh:The City of Palm Springs wants to understand its retail economic condition to allow them to recruit new retailers and retain current retailers on one (1) site to be specified by City of Palm Springs. 2. Understand Potential Visitors to City of Palm Springs:The City of Palm Springs wishes to identify characteristics of their existing and potential Palm Springs visitors. 3. Determine Media Preferences:City of Palm Springs wishes to utilize the customer profile to identify the media preferences of potential visitors to City of Palms Springs. Buxton's Solution Retail Recruitment Site Refresh Our Retail Recruitment solution is a total marketing strategy that enables community leaders to immediately implement a retail development program. It provides the same analytical information retailers depend on today to make site selection decisions so that you will have a compelling case as to why the City of Palm Springs can support new store and restaurant locations and expansions. Buxton will provide a refresh of a site that City of Palm Springs will specify. Tourism Solution Buxton will utilize our exclusive relationship with VISA to identify the origin and household-types of visitors to City of Palms Springs. City of Palms Springs will have a comprehensive view of likely visitors from households living outside and within the trade area. The deliverables for this solution include an executive summary and a workbook detailing all statistical data. This model will act as the engine to answer the following questions that will greatly assist in the development of the long-term strategic development plan: • Who Palm Springs' best visitors are • Where those best visitors live—and the means to reach them • The goods and services they consume while visiting Palm Springs Media Preference Analysis Buxton's Media Preference Analysis will allow City of Palm Springs to understand what motivates their prospective visitors to come to City of Palm Springs more often by better understanding the influence of each media type. All too frequently, marketing media is purchased based on the perception of who the customer is,as opposed to reality. Buxton's Media Preference Analysis, utilized in conjunction with the insights from City of Palm Springs'Tourism Solution,will ensure City of Palm Springs is making media purchases based on the reality of who their customer is and the most effective means of reaching them. This will make media buys and promotional efforts of all types more cost effective. Bwiaon Page 1 2 05 Applying this solution to meet your objectives: 1. Provide Retail Recruitment Site Refresh: Buxton will help City of Palm Springs to determine its retail economic condition,allowing them to recruit new retailers and retain current retailers on one(1)site to be specified by City of Palm Springs. 2. Understand Potential Visitors to City of Palm Springs:City of Palm Springs will be able to understand characteristics of their potential visitors. 3. Determine Media Preferences:City of Palm Springs will understand the media preferences of potential and existing customers for utilization in their marketing efforts. Next Page: Fees and Timing Btracin Page 13 06 Applying this solution to meet your objectives: 1. Provide Retail Recruitment Site Refresh: Buxton will help City of Palm Springs to determine its retail economic condition,allowing them to recruit new retailers and retain current retailers on one (1)site to be specified by City of Palm Springs. 2. Understand Potential Visitors to City of Palm Springs: City of Palm Springs will be able to understand characteristics of their potential visitors. 3. Determine Media Preferences:City of Palm Springs will understand the media preferences of potential and existing customers for utilization in their marketing efforts. Next Page: Fees and Timing B von Page 13 06 Section 2— Fees, Timing and Signatures Solution Fee Timeline Buxton's Solution $68,000 City of Palm Springs will have full access to their solution by October 11, 2013 The City of Palm Springs will be invoiced as follows:$25,000 Deposit Fee (invoiced upon execution of this agreement);$43,000 Completion Fee(invoiced upon delivery of solution). All service fees associated with this agreement are due net ten (10)days from the date of the invoice. Buxton may include City of Palm Springs on its client list in presentations and public relations efforts. When doing so, Buxton will not reveal information that is confidential and proprietary to City of Palm Springs. Agreed and Accepted: Buxton City of Palm Springs Signature Signature Printed Name Printed Name Title Title Date Date Burton Page 14 07 i Section 2— Fees, Timing and Signatures Solution Fee Timeline Buxton's Solution $68,000 City of Palm Springs will have full access to their solution by October 11, 2013 The City of Palm Springs will be invoiced as follows:$25,000 Deposit Fee (invoiced upon execution of this agreement); $43,000 Completion Fee (invoiced upon delivery of solution). All service fees associated with this agreement are due net ten (10)days from the date of the invoice. Buxton may include City of Palm Springs on its client list in presentations and public relations efforts. When doing so, Buxton will not reveal information that is confidential and proprietary to City of Palm Springs. Agreed and Accepted: g P Buxton City of Palm Springs Signature Signature Printed Name Printed Name Title Title Date Date Buxton Page 4 07 Appendix A: Additional Recommend Solutions Direct Single-Use Prospect Name and Address $10/mil (Minimum purchase of$5,000) Single-Use Prospect Name and Email $30/mil (Minimum purchase of$5,000) BU`,COn Page 1 5 08 Appendix A: Additional Recommend Solutions Direct Single-Use Prospect Name and Address $10/mil (Minimum purchase of$5,000) Single-Use Prospect Name and Email $30/mil (Minimum purchase of$5.000) ii BU`-uon Page 15