Carefree Truth
Issue #619, January 26, 2018
Councilman Gene Orrico asked Marketing Director Gina Kaegi if she had any idea how many attended the 2017 Pumpkin Festival. Mrs. Kaegi said the decision had been made to keep this a free event. Without ticket sales, it is difficult to accurately determine the numbers, so the only way to estimate that is based on the sales of merchandise, food, and drinks. Merchandise sales were up 20-30%; food and drink sales were up 55-75%. Other indicators include parking and the amount of restaurant business. She estimated that 50,000-55,000 attended, but said it could have been more. The Festival was visibly busier than it had been in 2016.
Newly appointed Councilman Stephen Hatcher asked if paper wrist bracelets could be given out to count attendees. Mrs. Kaegi explained that in order to do that there must be very few entrances. Fencing is required, as are people to cover the entrances in order to ticket an event or even distribute paper wrist bands. This creates significant expense. She had investigated it and the minimum cost would be $30,000. Mr. Hatcher asked if it could possibly be done just on higher traffic days. Mrs. Kaegi said the fencing would have to stay up the entire time, so the cost remains the same.
Councilman Mike Farrar said everyone is so proud of this unique Carefree event. Ray Villafane is so excited and talks to people. He has a studio right here in Carefree. But Mr. Farrar questioned whether all the expenses were being captured in Mrs. Kaegi's report, for instance, overtime for staff. Mrs. Kaegi assured him that all the labor costs were included. Mr. Farrar asked if the advertising expenditures reported included the website. Mrs. Kaegi confirmed that it did, including all the content updates. She explained that there was more cost involved when she first built the site, which took 4-5 weeks, but she does all the "heavy lifting" and writes all the material. A web builder/graphic designer in the Valley built the interface.
Mr. Farrar noted that the sponsorship amount was $9,000, then asked how much effort was put into getting sponsors to underwrite the event, and what was the push back. Mrs. Kaegi explained that an event must have ticket sales in order to get large amounts of money. You must be able to show ticket sales of 50,000. Corporations want to see the demographics. Carefree just can't do that. The event footprint is small, less than 4 acres.
There is potential to expand the event to take advantage of destination points like historic Spanish Village and CIVANA. That would warrant ticket sales. Many of Ray's other venues worldwide get $25 a ticket, but they are part of larger venues. Ray helps to leverage sponsors, which is an added value he brings. Mr. Farrar felt Carefree should push exposure for the sponsors rather than ticket sales. Mrs. Kaegi responded that it all plays in; they got bigger numbers from sponsors the third year.
Councilwoman Cheryl Kroyer pointed out that Carefree doesn't have a huge staff, so the Mayor and some Council members have tapped their contacts to be sponsors. It takes a lot of people and effort.
Mr. Farrar said there are 2 elements to the Festivals. Half is for the community; the other half is to bring in new retailers to fill the vacancies. The Town is dependent on sales tax revenue (STR) to pay for services and salaries. He asked if there were any metrics to understand if there were an increase in STR during the Pumpkin Festival. Mrs. Kaegi replied that she visits the businesses quite often. Most are small and don't have point of sale (POS) systems, which makes metrics a challenge. Mayor Les Peterson explained that the Town only gets reports on STR quarterly, at the end of each business' fiscal year or at the end of Carefree's fiscal year, making it difficult to know when STR is generated. Mrs. Kaegi noted that the restaurants really benefit. They are at capacity during festivals, which is why she brought in food trucks.
Mr. Farrar said the goal is to bring in people. Retailers want to see foot traffic and exposure when looking for places to locate. He said he doesn't want to see the Pumpkin Festival go away, but questioned its sustainability going forward unless there was some measure of return. He said the Town is making the investment today, and he supports that, but at some point, Carefree needs to exit out of the big cash flow.
Mrs. Kaegi said the numbers are very good. Businesses are finding they need to band together like the new Carefree Restaurant Association (CFRA). The $75,000 that was generated by the food trucks during the event could be managed by the CFRA to put that money back into the community and their businesses, using the money earned to increase their advertising. It is starting to click now, that the numbers are so good. More are wanting to leverage the platform the Town has built and use it to create a brand, and carrying items that would sell. The demographics show the attendees are not just families with children; they cover a broad age range.
Mr. Farrar added that the Town is doing everything it can. The business community needs to collectively take responsibility for marketing their own stores. Branding requires continuity and frequency. Mayor Peterson said he thinks it is in that transition stage now. Mr. Farrar felt that many events were needed in order to build on that.
The Mayor said that economic development has been defined as broader than the local retailers. It is an important component, and the Town wants to help them generate more business and STR. But the new owners of CIVANA and the people who will be building the luxury apartments in the town center will tell you that Carefree's signature events have demonstrated that people will come up here. That was a meaningful aspect of their decision to locate in Carefree. This provides a geometric of the return on that investment.
Mr. Farrar agreed that it creates a lifestyle that attracts people to live here. But we are a small community and must do everything possible to attract sponsors. Mrs. Kaegi replied that we are a small community with big ideas, and have proven we can execute them. Vice Mayor John Crane said mitigating costs was discussed at the budget meetings last spring. The estimate was $25,000 for merchandise sales, etc. That number was exceeded and he felt the numbers would be even better next year. "We are learning." The event is growing and growing. There will still be a delta, but it will be less.
Mayor Peterson noted that the non-profits' numbers keep rising too, because the Town is supporting them as they participate. Mrs. Kaegi said that was a goal after the first year of the Pumpkin Festival. Ms. Kroyer called it an amazing event that is becoming world famous. It is well known locally and is a franchise for Carefree, a great signature event. "And Gina, great job!"
Mr. Farrar said it's a wonderful franchise event that really brands Carefree. It's powerful, like the Christmas Festival. But Carefree must pay attention to the other days of the year so that when people come up here they can take advantage of the brand we're building. The experience must be positive and expectations must be fulfilled by the merchants. The Town is providing a platform; the merchants need to make it happen. People drive up here and are disappointed to find a store closed early. People must be brought up more than just on weekends and during 2 week events, but consistently. Things must be done to extend the season and build on the brand. It can't be dead when a trolley full of people come from Cave Creek.
Mayor Peterson stated that Ray has historically been the centerpiece of this whole effort. He and Gina have been broadening this event. Ray has consistently exceeded what he promised and what was requested of him. He did not raise his price of $85,000 last year. He brought in more artists and they were carving in the pavilion at key times. Ray was there more frequently. Carefree has historically used Ray in the spring for sand sculptures. That has now been pulled back. The Town is looking for alternatives to do in concert with the merchants. Ray has requested $100,000 for his continued participation in 2018, and the Mayor thought it was well worth it. Ray gives more than he is asked for every time, and is an important cog. It is time to renew his contract. The Mayor, Gary Neiss and Gina have looked at it, with some input from Vice Mayor Crane and Councilwoman Kroyer as well. It has been reviewed by Town attorney Mike Wright. Mayor Peterson highly recommended continuing to work with Ray.
Mr. Hatcher asked if it would be practical to bring a small version of the event to the Phoenix Children's Hospital. He works with some of the board members and thinks they would love bringing it to the children if it were small and cost effective. If shared with the children at the hospital, it would spread to the families. Done 2 weeks before the event, it would make a whole new group aware, and potentially get a donation from the hospital.
Mrs. Kaegi replied that she's as open as can be. Ray has done so much for so many of the non-profits. "If it's beneficial, yes, we can do anything." Ms. Kroyer felt going out into the community was an interesting idea. Mrs. Kaegi said Ray has a dream of taking a big orange pumpkin truck into the the inner cities and giving pumpkins to those who can't afford one. He has already bought an old rustic orange truck, and was featured in a commercial with it. He is trying to get that going. "He loves doing that kind of stuff."
Mayor Peterson noted that APS is one of the major event sponsors. APS is in need of positive PR for a number of reasons. Perhaps they would be interested in sponsoring such an event. It could be done with the Town or as a separate contract between APS and Ray.
Mr. Farrar remembered the pumpkin carved for ESPN the first year, and that it was featured at the Superbowl, which was great exposure for Ray and for the Town. He suggested APS, Chase Bank and Children's Hospital pumpkins. He said the Governor's office is interested in riding on the trolley for a media opportunity, showing 2 small towns working together.
Mayor Peterson suggested approving the contract and all starting to work together now to maximize these kinds of ideas and making the past years' numbers even better.
Vice Mayor Crane had noticed that in the 2017 contract, Schedule A called for Ray to appear on the opening day of the event and during the last weekend. That was not there in the 2018 contract. Mrs. Kaegi said she would add it. She said the biggest issue is Ray's availability. He is always there for at least one weekend, and tries to be as available as possible. Halloween is his busy season when he makes his bread and butter. It's like Christmas for Santa Claus. Mayor Peterson said Mike Wright asked for a clarification of Ray's legal business name and an agreement to go into arbitration if a problem arises. Ms. Kroyer wanted something added to Schedule A that addresses Ray going out into the community. Mrs. Kaegi said Ray is very open to this. "Unless he's on his deathbed, he'll usually do it." "And he'll do it exponentially." Ms. Kroyer still wanted to see it in writing. The contract was approved 7-0, subject to those additions.
https://vimeo.com/250981858
Lyn Hitchon
Prepared by Carefree Truth
Visit our website at www.carefreetruth2.com If you know anyone who would like to be added to the Carefree Truth email list, please have them contact me. Feel free to share Carefree Truth with others on your list.
Visit www.carefreeazbusinesses.com to see more info about businesses in Carefree. Please support our merchants.
Issue #619, January 26, 2018
Councilman Gene Orrico asked Marketing Director Gina Kaegi if she had any idea how many attended the 2017 Pumpkin Festival. Mrs. Kaegi said the decision had been made to keep this a free event. Without ticket sales, it is difficult to accurately determine the numbers, so the only way to estimate that is based on the sales of merchandise, food, and drinks. Merchandise sales were up 20-30%; food and drink sales were up 55-75%. Other indicators include parking and the amount of restaurant business. She estimated that 50,000-55,000 attended, but said it could have been more. The Festival was visibly busier than it had been in 2016.
Newly appointed Councilman Stephen Hatcher asked if paper wrist bracelets could be given out to count attendees. Mrs. Kaegi explained that in order to do that there must be very few entrances. Fencing is required, as are people to cover the entrances in order to ticket an event or even distribute paper wrist bands. This creates significant expense. She had investigated it and the minimum cost would be $30,000. Mr. Hatcher asked if it could possibly be done just on higher traffic days. Mrs. Kaegi said the fencing would have to stay up the entire time, so the cost remains the same.
Councilman Mike Farrar said everyone is so proud of this unique Carefree event. Ray Villafane is so excited and talks to people. He has a studio right here in Carefree. But Mr. Farrar questioned whether all the expenses were being captured in Mrs. Kaegi's report, for instance, overtime for staff. Mrs. Kaegi assured him that all the labor costs were included. Mr. Farrar asked if the advertising expenditures reported included the website. Mrs. Kaegi confirmed that it did, including all the content updates. She explained that there was more cost involved when she first built the site, which took 4-5 weeks, but she does all the "heavy lifting" and writes all the material. A web builder/graphic designer in the Valley built the interface.
Mr. Farrar noted that the sponsorship amount was $9,000, then asked how much effort was put into getting sponsors to underwrite the event, and what was the push back. Mrs. Kaegi explained that an event must have ticket sales in order to get large amounts of money. You must be able to show ticket sales of 50,000. Corporations want to see the demographics. Carefree just can't do that. The event footprint is small, less than 4 acres.
There is potential to expand the event to take advantage of destination points like historic Spanish Village and CIVANA. That would warrant ticket sales. Many of Ray's other venues worldwide get $25 a ticket, but they are part of larger venues. Ray helps to leverage sponsors, which is an added value he brings. Mr. Farrar felt Carefree should push exposure for the sponsors rather than ticket sales. Mrs. Kaegi responded that it all plays in; they got bigger numbers from sponsors the third year.
Councilwoman Cheryl Kroyer pointed out that Carefree doesn't have a huge staff, so the Mayor and some Council members have tapped their contacts to be sponsors. It takes a lot of people and effort.
Mr. Farrar said there are 2 elements to the Festivals. Half is for the community; the other half is to bring in new retailers to fill the vacancies. The Town is dependent on sales tax revenue (STR) to pay for services and salaries. He asked if there were any metrics to understand if there were an increase in STR during the Pumpkin Festival. Mrs. Kaegi replied that she visits the businesses quite often. Most are small and don't have point of sale (POS) systems, which makes metrics a challenge. Mayor Les Peterson explained that the Town only gets reports on STR quarterly, at the end of each business' fiscal year or at the end of Carefree's fiscal year, making it difficult to know when STR is generated. Mrs. Kaegi noted that the restaurants really benefit. They are at capacity during festivals, which is why she brought in food trucks.
Mr. Farrar said the goal is to bring in people. Retailers want to see foot traffic and exposure when looking for places to locate. He said he doesn't want to see the Pumpkin Festival go away, but questioned its sustainability going forward unless there was some measure of return. He said the Town is making the investment today, and he supports that, but at some point, Carefree needs to exit out of the big cash flow.
Mrs. Kaegi said the numbers are very good. Businesses are finding they need to band together like the new Carefree Restaurant Association (CFRA). The $75,000 that was generated by the food trucks during the event could be managed by the CFRA to put that money back into the community and their businesses, using the money earned to increase their advertising. It is starting to click now, that the numbers are so good. More are wanting to leverage the platform the Town has built and use it to create a brand, and carrying items that would sell. The demographics show the attendees are not just families with children; they cover a broad age range.
Mr. Farrar added that the Town is doing everything it can. The business community needs to collectively take responsibility for marketing their own stores. Branding requires continuity and frequency. Mayor Peterson said he thinks it is in that transition stage now. Mr. Farrar felt that many events were needed in order to build on that.
The Mayor said that economic development has been defined as broader than the local retailers. It is an important component, and the Town wants to help them generate more business and STR. But the new owners of CIVANA and the people who will be building the luxury apartments in the town center will tell you that Carefree's signature events have demonstrated that people will come up here. That was a meaningful aspect of their decision to locate in Carefree. This provides a geometric of the return on that investment.
Mr. Farrar agreed that it creates a lifestyle that attracts people to live here. But we are a small community and must do everything possible to attract sponsors. Mrs. Kaegi replied that we are a small community with big ideas, and have proven we can execute them. Vice Mayor John Crane said mitigating costs was discussed at the budget meetings last spring. The estimate was $25,000 for merchandise sales, etc. That number was exceeded and he felt the numbers would be even better next year. "We are learning." The event is growing and growing. There will still be a delta, but it will be less.
Mayor Peterson noted that the non-profits' numbers keep rising too, because the Town is supporting them as they participate. Mrs. Kaegi said that was a goal after the first year of the Pumpkin Festival. Ms. Kroyer called it an amazing event that is becoming world famous. It is well known locally and is a franchise for Carefree, a great signature event. "And Gina, great job!"
Mr. Farrar said it's a wonderful franchise event that really brands Carefree. It's powerful, like the Christmas Festival. But Carefree must pay attention to the other days of the year so that when people come up here they can take advantage of the brand we're building. The experience must be positive and expectations must be fulfilled by the merchants. The Town is providing a platform; the merchants need to make it happen. People drive up here and are disappointed to find a store closed early. People must be brought up more than just on weekends and during 2 week events, but consistently. Things must be done to extend the season and build on the brand. It can't be dead when a trolley full of people come from Cave Creek.
Mayor Peterson stated that Ray has historically been the centerpiece of this whole effort. He and Gina have been broadening this event. Ray has consistently exceeded what he promised and what was requested of him. He did not raise his price of $85,000 last year. He brought in more artists and they were carving in the pavilion at key times. Ray was there more frequently. Carefree has historically used Ray in the spring for sand sculptures. That has now been pulled back. The Town is looking for alternatives to do in concert with the merchants. Ray has requested $100,000 for his continued participation in 2018, and the Mayor thought it was well worth it. Ray gives more than he is asked for every time, and is an important cog. It is time to renew his contract. The Mayor, Gary Neiss and Gina have looked at it, with some input from Vice Mayor Crane and Councilwoman Kroyer as well. It has been reviewed by Town attorney Mike Wright. Mayor Peterson highly recommended continuing to work with Ray.
Mr. Hatcher asked if it would be practical to bring a small version of the event to the Phoenix Children's Hospital. He works with some of the board members and thinks they would love bringing it to the children if it were small and cost effective. If shared with the children at the hospital, it would spread to the families. Done 2 weeks before the event, it would make a whole new group aware, and potentially get a donation from the hospital.
Mrs. Kaegi replied that she's as open as can be. Ray has done so much for so many of the non-profits. "If it's beneficial, yes, we can do anything." Ms. Kroyer felt going out into the community was an interesting idea. Mrs. Kaegi said Ray has a dream of taking a big orange pumpkin truck into the the inner cities and giving pumpkins to those who can't afford one. He has already bought an old rustic orange truck, and was featured in a commercial with it. He is trying to get that going. "He loves doing that kind of stuff."
Mayor Peterson noted that APS is one of the major event sponsors. APS is in need of positive PR for a number of reasons. Perhaps they would be interested in sponsoring such an event. It could be done with the Town or as a separate contract between APS and Ray.
Mr. Farrar remembered the pumpkin carved for ESPN the first year, and that it was featured at the Superbowl, which was great exposure for Ray and for the Town. He suggested APS, Chase Bank and Children's Hospital pumpkins. He said the Governor's office is interested in riding on the trolley for a media opportunity, showing 2 small towns working together.
Mayor Peterson suggested approving the contract and all starting to work together now to maximize these kinds of ideas and making the past years' numbers even better.
Vice Mayor Crane had noticed that in the 2017 contract, Schedule A called for Ray to appear on the opening day of the event and during the last weekend. That was not there in the 2018 contract. Mrs. Kaegi said she would add it. She said the biggest issue is Ray's availability. He is always there for at least one weekend, and tries to be as available as possible. Halloween is his busy season when he makes his bread and butter. It's like Christmas for Santa Claus. Mayor Peterson said Mike Wright asked for a clarification of Ray's legal business name and an agreement to go into arbitration if a problem arises. Ms. Kroyer wanted something added to Schedule A that addresses Ray going out into the community. Mrs. Kaegi said Ray is very open to this. "Unless he's on his deathbed, he'll usually do it." "And he'll do it exponentially." Ms. Kroyer still wanted to see it in writing. The contract was approved 7-0, subject to those additions.
https://vimeo.com/250981858
Lyn Hitchon
Prepared by Carefree Truth
Visit our website at www.carefreetruth2.com If you know anyone who would like to be added to the Carefree Truth email list, please have them contact me. Feel free to share Carefree Truth with others on your list.
Visit www.carefreeazbusinesses.com to see more info about businesses in Carefree. Please support our merchants.