Mt. Crested Butte looks for proof of marketing success

Town wants biggest bang for admissions tax buck

The town of Mt. Crested Butte wants to know exactly how much tourist traffic is being generated by the marketing efforts of the Gunnison-Crested Butte Tourism Association (TA) and whether the number of guests is worth the money the town pays out each year.

With the admissions tax going before voters for renewal in 2010, and possibly earlier, Mt. Crested Butte mayor William Buck and town manager Joe Fitzpatrick met with representatives of the TA and the Local Marketing District (LMD) board of directors on Tuesday, December 23 to discuss the marketing effort’s success.
“The major concern for Mt. Crested Butte is just to be able to determine the effectiveness of what is being done by the TA. They have a million-plus dollar budget and we’re asking, ‘Are we as a group getting a good return for our investment?’” says Mt. Crested Butte town manager Joe Fitzpatrick.
Through the 4 percent admissions tax, charged on everything from lift tickets to snowmobile rentals, the town of Mt. Crested Butte was able to pass on $250,000 for the TA in 2008 and is projecting $200,000 in 2009.
The town also gave Crested Butte Mountain Resort $100,000 from the admissions tax fund to help offset the cost of a promotion allowing guests to buy two airline tickets and get a third for free.
The only other source of income to feed the TA’s $1.1 million budget is a separate 4 percent lodging tax assessed on overnight stays in the county. Both taxes are collected and doled out to the county’s Local Marketing District in the county’s budget, which administers the money to the TA.
But the ballot language passed by Mt. Crested Butte voters approving the admissions tax doesn’t specify how much of that money has to go to the TA, which could allow the town to funnel more money into a marketing effort of its own.
“The way the language is, the money from the admissions tax can go anywhere. There are some words that say support the marketing in the area, but it still gives the town the authority to administer those funds any number of ways,” says Fitzpatrick.
He says the town has no intention of managing its own marketing, but might consider contracting with an outside agency to create campaigns geared directly toward bringing tourists to the ski area. The town of Mt. Crested Butte surrounds the Crested Butte Mountain Resort ski area.
During the meeting, Fitzpatrick pointed out that in a recent evaluation, Mt. Crested Butte didn’t have the overall growth in lodging tax that the rest of Gunnison County did, leading the town council to wonder if the marketing campaigns were bringing people to town.
“Essentially, Mt. Crested Butte has raised questions about whether they get a better bang for their buck on the admissions tax by giving it to the TA or handling it themselves for its own marketing campaigns,” says LMD director Jim Starr.
Tourism Association executive director Jane Chaney and marketing coordinator Rob Strickland say the information they’ve collected overwhelmingly shows the TA’s campaigns to be successful at bringing people to Mt. Crested Butte, the county’s major tourist attraction in winter.
According to statistics compiled by the TA, 50 percent of the marketing budget for the entire valley is spent on campaigns intended to bring people in for the winter, while only 40 to 45 percent of the TA budget is generated by taxes collected from Mt. Crested Butte during the four and a half month ski season.
“The TA puts out a lot of reports, but the Town Council is looking for a better way to have snapshots and just be able to prove those statistics. It’s difficult for them to do because they are not a point of sale. They can’t compare the marketing budget for a campaign to the number of packages sold. So we have to try to find a way to measure its success by an overall measure,” says Fitzpatrick.
Part of the special consideration being paid to the town’s marketing budget comes from the failed mil levy increase that would have given a cushion to the town’s budget. Without the extra money that would have generated, “Mt. Crested Butte is looking at every penny,” Fitzpatrick says.
One way the Town Council could keep a closer eye on the money it contributes to the TA is through a presence on the Local Marketing District or TA boards, but both would require a complete restructuring of the TA, which now has the Board of County Commissioners as its board of directors.
The Mt. Crested Butte Town Council has asked the TA to develop a new metric to measure the effectiveness of its marketing campaigns, which will help them determine the future of the admissions tax dollars in the first months of the new year. The two boards will be discussing a memorandum of agreement at a town council meeting on January 6.