Addressing the issue of declining room stays in VC The issue of - - PDF document

1

Addressing the issue of declining room stays in VC

The issue of declining room nights and visitation has been known for many years. From VCTC Strategic Plan 2009 (?) : Overall lodging trends for Virginia City have been challenging with occupancy averaging 17% over the last several years. It should be noted that the highest demand for lodging is during the Mid‐March through October time frame. After that a number of properties close for the season, as such the occupancy rate for the Mid March through October time frame would be higher. Since 2003 when the traffic counter was first installed traffic counts have declined 36%, an average of 6% a year. From Chris Eichin presentation July 2014: Room nights in VC have been on a steady decline year over year 2011 to present The current VCTC strategic plan has elements aimed at trying to address this issue:

• C. Objectives
• 1. Build and strengthen the Virginia City brand by positioning the area as a destination

truly unique and different from the competition Strategic Elements

• In order to clearly differentiate Virginia City from the competition and to effectively

position the area as a unique travel destination, it is critical that all the elements of Virginia City be effectively communicated in a way that potential visitors see the variety

• f tourist activities and services available, and are encouraged to extend/plan a longer

visit. A small group of VC lodging operators came together to try and better define this issue and to brainstorm approaches to help solve it and help to move the VCTC strategic plan forward in that area. We discussed several “problem statements” beyond the presenting problem of declining room nights and determined that there were some deeper questions that we needed to have answered before proceeding. Question #0= The writing is on the wall…most of the lodging properties are for sale or are losing money….is it OK if they close/go away?

• -if it’s not a concern to county and community leaders then we don’t need to

change much. However, new businesses or buyers for the “for sale” businesses

2

may not want to buy or move here if they have only 15 weeks to make their revenue for the year due to our perceived seasonality. If the loss of revenue for both room tax and sales tax is seen as incremental to the overall revenue stream for the county now or in the future then this may not be the highest revenue priority at this time.

• -if it is a concern to county and community leaders then a sense of urgency ,

significant changes and focus needs to be put on this problem immediately…we need begin to plan and implement this part of the VCTC strategic plan and add to it:

• Attractions ‐ It is critical that VCCTA leverage the current attractions,

primarily history and special events. Within the area’s history Virginia City

• ffers several distinct niches with which to attract visitors. These include

mining history, the new V&T Railroad and Mark Twain. Each of these could be used to target specific segments of visitors, with the resulting

• pportunity of letting them know that there are a variety of historical

attractions within the area.

• Infrastructure ‐ This includes being a catalyst for issues including

transportation as well as new ideas like shutting Main Street down to traffic, along with any other ideas that help improve the visitor experience. Question #1=VCTC has a good marketing plan for VC but VC itself needs a strategic plan. Who are we, What do we want to be, How do we get there?

• -Seasonal , week-end day trip, events and activities
• -Year round, 7 days a week destination, nightlife, events, experiences, education

and fun

• -??

Question #2= What and where is the commitment and support to make VC an overnight destination and increase room nights ( and total revenues inclusive of retail) in VC? Is this a high priority?

• If not a high priority, given other issues…then incremental improvements and a

purely event driven strategy will be fine in the short run but we will continue to lose some merchants, lodging and revenues as a result. People can stay in Reno and Carson but still come up for the day

3

• If it is a priority, transformational changes need to be planned for in addition to

improving/refreshing existing differentiators. We haven’t added anything big or NEW in many years. Below is a list of brainstormed concepts and suggestions from the group:

• Do the right things right- strengthen our major differentiator—our place

in history. We need to make this history exciting for a wider range of people

• WORLDWIDE. We need to have a targeted plan on how to do this, not

just from a promotional point of view but from the standpoint that we have a sacred trust to preserve and pass our history on in the right way. This includes how we communicate it, keeping our historical places restored, spotlighting our history by tying our events TO history where we can ( Muckfest is a good example, we need many more)…do a REAL Christmas on the Comstock each week-end November thru December. AR-get a brainstorming group to help flesh this out and develop a prioritized list of actions that can be started. This group need not be merchants, but citizens who are passionate about this.

• Embrace our Bonanza “history”. Bring the Ponderosa to VC and build

activities and events around that “brand”..ie…can build excitement and reintroduce VC to the global market with a “ the Ponderosa returns home” type promotion when it’s ready. It will bring back those who remember it, introduce it to those who don’t…tie it to the rich history of the Comstock and it’s mining heritage . Can have “Bonanza events” at night including ferriers/blacksmiths, spinning/weaving demos, locals and visitors dress up, have gunfights, close C street on weekend evenings for these “night faire” events AR- look at the viability and funding avenues to buy the Ponderosa set or build one and to get the land. Some options are already

• identified. Hollywood and the families/estates of the original actors is a

fertile source of funding for this.

• Add recreational and fitness elements such as bike, walking ,hiking trails

and Zip-line experience to go with Zombie Run, grand prix, other races

4

AR-look at what trails exist or can be easily cleared and provide maps….improve as we go.

• Support and promote eco-tourism including Petroglyphs. Pat Colleti is on

his way to doing this with the Wild Horse Sanctuary, lets see what help he needs to get it done

• FIX the transportation problem. Rebuild the town stairs to allow for ease
• f walking in town, fund ongoing daily on/off trolley with prerecorded

historically accurate narrative, and address the perception that driving Geiger is a barrier to going to VC.

• Nightlife is an easier task to tackle since our restaurants, bars, casinos

and museums can scale their hours up or down as we begin to implement the above elements to bring more overnighters in. It’s chicken or egg but we can have a 6 month trial period where we ask our merchants to commit to stay open late to see what the effect would be. Add special events, perhaps Octoberfest events There is a talent pool in Storey County that has experience in grant writing, lets tap it.

August 2014

Addressing the issue of declining room stays in VC in

• rder to generate more revenues for the Town

Robert Steiner-Silverland Clay Mitchel-Gold Hill Hotel Paul Yandre-Cobb Mansion Jim Clark Chris Eichin- B Street B & B Izabella Kelley & Homer Clark Finders Keepers

The Problem

Most of the lodging properties are for sale or are losing money...is that OK?

Research shows that multiple room nights equal more revenue spent. Loss of room nights has an implication for Room Tax and Sales Tax revenues for the County/VCTC and revenues for the merchants. If not a concern then no change is necessary but finding buyers for the properties will be an issue for the sellers. If it is a concern then this needs to be specifically addressed thru VCTC Strategic plan with specific focus

• n how to increase room nights thru a variety of ways

Key questions= Who are we, what do we want to be, how do we get there?

 Seasonal, week-end day trip, events and activities  Year round, 7 days a week destination, nightlife,

experiences, education and fun

 Singles, Family, adventure  ????

Key Questions= Is there a commitment to make VC an

• vernight destination? What would it take?

Do the right things right-Strengthen our key differentiator -our place in history

Embrace our Bonanza “History”

returns home” type promotion when it’s ready. It will bring back those who remember it, introduce it to those who don’t...tie it to the rich history of the Comstock and it’s mining heritage .

demos, locals and visitors dress up, have gunfights, close C street on weekend evenings for these “night faire” events

What would it take to make VC an overnight destination (cont’d )….

Add recreational and fitness elements such as bike, walking ,hiking trails and Zip-line experience to go with Zombie Run, grand prix, other races

Do we have the variety of businesses in VC to keep us “top of mind” as a multi experiential destination?

Some discussion of doing a gap analysis of business

• fferings and “experience” attractions then recruiting

businesses to fill the gap.

 Restaurants  Zip line or other activity based business  Activities for kids and families  There was no Roasting House, Brewery or Cigar Bar at

this time so we’ve added but do we have enough diversity to meet family overnighters?

Bottom Line...

VCTC has done a good job of promoting the town and bringing people here. Now….we need to KEEP THEM here.

B Street House Bed & Breakfast

Storey County Tourism Development in FY12, FY13, and FY14

(July 2011 through March 2014)

Prepared by:

20% 40% 60% 80% 100% 120% 140% 160% FY12 (Base) FY13 FY14 (YTD)

Storey County Sales and Use Tax July 01, 2012 through March 31, 2014

FY12 as Basis ‐ Source: Nevada Department of Taxation Storey County Overall

All 78 reported Line Items, incl. Manufacturing, Mining, Real Estate, etc.

B Street House Bed & Breakfast

Prepared by:

20% 40% 60% 80% 100% 120% 140% 160% FY12 (Base) FY13 FY14 (YTD)

Storey County Sales and Use Tax July 01, 2012 through March 31, 2014

FY12 as Basis ‐ Source: Nevada Department of Taxation Storey County Overall 445 Food/Bev Stores

B Street House Bed & Breakfast

Prepared by:

20% 40% 60% 80% 100% 120% 140% 160% FY12 (Base) FY13 FY14 (YTD)

Storey County Sales and Use Tax July 01, 2012 through March 31, 2014

FY12 as Basis ‐ Source: Nevada Department of Taxation Storey County Overall 445 Food/Bev Stores 452 Gen Merch Stores

B Street House Bed & Breakfast

Prepared by:

20% 40% 60% 80% 100% 120% 140% 160% FY12 (Base) FY13 FY14 (YTD)

Storey County Sales and Use Tax July 01, 2012 through March 31, 2014

FY12 as Basis ‐ Source: Nevada Department of Taxation Storey County Overall 445 Food/Bev Stores 452 Gen Merch Stores 453 Misc Store retail

B Street House Bed & Breakfast

Prepared by:

20% 40% 60% 80% 100% 120% 140% 160% FY12 (Base) FY13 FY14 (YTD)

Storey County Sales and Use Tax July 01, 2012 through March 31, 2014

FY12 as Basis ‐ Source: Nevada Department of Taxation Storey County Overall 445 Food/Bev Stores 452 Gen Merch Stores 453 Misc Store retail 722 Drinking Places

B Street House Bed & Breakfast

Prepared by:

20% 40% 60% 80% 100% 120% 140% 160% FY12 (Base) FY13 FY14 (YTD)

Storey County Sales and Use Tax July 01, 2012 through March 31, 2014

FY12 as Basis ‐ Source: Nevada Department of Taxation Storey County Overall 445 Food/Bev Stores 452 Gen Merch Stores 453 Misc Store retail 722 Drinking Places 448 Clothing/Access.

B Street House Bed & Breakfast

Prepared by:

20% 40% 60% 80% 100% 120% 140% 160% FY12 (Base) FY13 FY14 (YTD)

Storey County Sales and Use Tax July 01, 2012 through March 31, 2014

FY12 as Basis ‐ Source: Nevada Department of Taxation Storey County Overall 445 Food/Bev Stores 452 Gen Merch Stores 453 Misc Store retail 712 Museums etc 722 Drinking Places 448 Clothing/Access.

B Street House Bed & Breakfast

Prepared by:

20% 40% 60% 80% 100% 120% 140% 160% FY12 (Base) FY13 FY14 (YTD)

Storey County Sales and Use Tax July 01, 2012 through March 31, 2014

FY12 as Basis ‐ Source: Nevada Department of Taxation Storey County Overall 445 Food/Bev Stores 452 Gen Merch Stores 453 Misc Store retail 712 Museums etc 721 Accommodation 722 Drinking Places 448 Clothing/Access.

B Street House Bed & Breakfast

Prepared by:

VCTC Monthly Report (March 2014) Room Nights Sold

B Street House Bed & Breakfast

Prepared by:

B Street House Bed & Breakfast

Prepared by:

VCTC Monthly Report (March 2014) Room Nights Sold

50% 60% 70% 80% 90% 100% 110% 120% 130% 140% 150%

JUL‐11 AUG‐11 SEP‐11 OCT‐11 NOV‐11 DEC‐11 JAN‐12 FEB‐12 MAR‐12 APR‐12 MAY‐12 JUN‐12 JUL‐12 AUG‐12 SEP‐12 OCT‐12 NOV‐12 DEC‐12 JAN‐13 FEB‐13 MAR‐13 APR‐13 MAY‐13 JUN‐13 JUL‐13 AUG‐13 SEP‐13 OCT‐13 NOV‐13 DEC‐13 JAN‐14 FEB‐14

Room Nights SOLD compared to FY11

Basis (100%): FY11 ‐ [all data from VCTC website]

B Street House Bed & Breakfast

Prepared by:

50% 60% 70% 80% 90% 100% 110% 120% 130% 140% 150%

JUL‐11 AUG‐11 SEP‐11 OCT‐11 NOV‐11 DEC‐11 JAN‐12 FEB‐12 MAR‐12 APR‐12 MAY‐12 JUN‐12 JUL‐12 AUG‐12 SEP‐12 OCT‐12 NOV‐12 DEC‐12 JAN‐13 FEB‐13 MAR‐13 APR‐13 MAY‐13 JUN‐13 JUL‐13 AUG‐13 SEP‐13 OCT‐13 NOV‐13 DEC‐13 JAN‐14 FEB‐14

Room Nights SOLD compared to FY11

Basis (100%): FY11 ‐ [all data from VCTC website]

B Street House Bed & Breakfast

Prepared by:

AND WHY DO WE NEED MORE

OVERNIGHT

TOURISTS?

B Street House Bed & Breakfast

Prepared by:

Day Tourist Overnight Guest

An Overnight Guest Spends 3.5 Times As much as a Day Tourist

[ Source: NCOT ]

B Street House Bed & Breakfast

Prepared by:

B Street House Bed & Breakfast

Prepared by:

B Street House Bed & Breakfast

Prepared by:

B Street House Bed & Breakfast

Prepared by:

Destination VC Destination Marketing