VVisisitit A Alelexxaannddrriaia || 22001166 AAnnnnuuaal lR Reeppoorrtt 2016 Annual Report Dear Members, Partners & Friends: We are pleased to share with you this Visit Alexandria 2016 Annual Report. By all accounts, we can take pride in our collective effort and investment that produced record tourism revenues, city tax receipts, hotel occupancy, media coverage, and web traffic for Alexandria. Thank you for the partnership that has made tourism & hospitality a major contributor to the city’s economy and quality of life. At Visit Alexandria our job is to brand and market Alexandria in a highly competitive, fast changing environment. While our marketing reach is global, the brand is built on local authenticity. The care, quality, and continuous improvement of the Extraordinary Alexandria experience makes Alexandria a buzzed about destination and drives people to our city again and again. The investment in the visitor experience and the results of consistent branding and marketing continue to reap dividends and make the tourism industry a bright spot in the regional economy. Highlights of Visit Alexandria’s results in FY2016 include: (cid:0) $771 million in visitor spending (record) (cid:0) $25.5 million in City tax revenue from visitor spending (record) (cid:0) 72.9% hotel occupancy (cid:0) 1.88 million web visits (record) This report documents many accomplishments from the past year, including the launch of the national PBS series, Mercy Street, the creation of the MGM Readiness Task Force, a new health care meetings initiative, the merger of our visitor and member services areas, and dramatic growth in earned income. But this report does not just document the past—it also looks to the future. These are pivotal times. City councils across America are being squeezed by the concurrent needs to assure public safety, attract high-paying jobs, protect the environment, assist the most vulnerable, facilitate smooth transit, and educate our children for the 21st century, and to do it all with decreasing federal and state support. There is only one way to achieve those objectives—through strong economic growth. In Alexandria, a huge part of our economic engine is powered by the resources, reputation and quality of life that tourism delivers. Fiscal 2017 brings broad economic challenges, but also unique local opportunities. These include the opening of MGM, Mercy Streetseason two, and Washington, DC's first ever hosting of the U.S. Travel Association's IPW convention. We share this plan to seize the new opportunities and invite you to come alongside us again this year, and continue the progress that we have made together for the city we love, because it deserves our very best. Victor Parra Patricia Washington 2016 Chair President & CEO 2 Visit Alexandria FY 2016 Annual Report Power of Place Attracting visitors is essential to the unique quality of life that all of us enjoy in Alexandria. We need a critical mass of activity to support historic preservation, locally-owned retail, an array of Visitor Spending2 $771 M dining options, cultural amenities, and a job-producing economy. It is the blend of global visitors and local residents that makes $754 M Alexandria a vibrant place to live, work and visit—a symbiosis $739 M $738 M where we provide our guests with an independent, authentic American experience, and they provide us with cultural diversity $711 M and economic vibrancy. City Tax Revenue2 $25.5 M $24.2 M $24.1 M $23.7 M Economic Impact $23.1 M Jobs2 6,340 Beyond our quality of life, Alexandria visitors also generate jobs, business and tax revenues that fund essential City services. Every dollar invested in visitor advertising yields $171 in economic 6,158 6,150 6,171 activity and $6 in local tax receipts.Visitors save the average 6,067 Alexandria household over $350 per year in taxes.1 Every Dollar Yields $6 in Local Tax Receipts Invested Occupancy3 72.9% 72.9% in Visitor Advertising 69.2% 69.4% 68.9% Revenue Per Available Room (RevPAR)3 $110 $108 $102 (1) Source: Advertising Effectiveness and ROI Study, Destination Analysts, San Francisco, 2014. $100 $98 (2) Source: 2015 Economic Impact of Domestic Travel on Virginia and Localities, Virginia Tourism Corporation. Data is based on macroeconomic modeling and provides an estimate of receipts, not an accounting of actual taxes and receipts. (3) Source: Smith Travel Research Monthly Report, June 2016. 2011 2012 2013 2014 2015 Visit Alexandria FY 2016 Annual Report 3 Mission: To generate tourism and meetings that increase revenues and promote the City of Alexandria and its assets. Who We Are and How We Do It Advertising Promotions Sales At Visit Alexandria, we employ an integrated marketing approach to achieve Research PR our mission. In the current environment, research shows that the average Marketing Mix customer interacts with 38 websites before booking. Our job is to ensure that the Alexandria brand ‘cuts through the clutter’, catches the eye and is Visitor Social & Member available at every point along the customer’s decision journey. Services Media Advertising — Visit Alexandria relaunched our brand in 2013 to reposition Publications Web Alexandria as a vibrant, contemporary, welcoming destination with historic International authenticity. Two-thirds of our advertising is now digital (online, paid search, boosted social, search engine optimization) and one third is traditional (TV, radio, print). Meetings & Conference Sales — Our team of four sales professionals works directly with meeting planners, government groups, association executives, event organizers and wedding planners to recruit groups to Alexandria’s hotels, attractions and businesses. Our high-touch, “Meetings Made Extraordinary” approach distinguishes Alexandria from the competition in the small and mid-size meetings segment. Public Relations — PR is a highly credible and cost-efficient marketing medium that extends the geographic reach of our marketing nationally and internationally while maintaining a strong presence in DC regional media. Our Communications team has increased our network of top-tier national contacts by hiring a New York City-based PR firm in late FY16 with an increasing payoff as the team cultivates these new relationships. Social Media — Across all industries, “word-of-mouth” is the most relied-upon and trusted source of information in consumer decision making. The Visit Alexandria team creates compelling content that resonates authentically with our fans and followers, which they in turn share with their networks. Visit Alexandria’s dedicated full-time social media staff ensures up-to-the-minute content and a constant presence on Facebook, Twitter, Instagram, LinkedIn and the latest social media platforms. Web — The critical point of fulfillment is our website, VisitAlexandriaVA.com. Traffic has more than doubled over the last five years to almost 1.9 million visits annually. Our content-first approach ensures that visitors can personalize their visit to their interests with up-to-the-minute events, activities, lodging, and dining information just a click away. International — Working with our Capital Region partners, Visit Alexandria leverages a $50,000 annual investment to achieve a $250,000 global marketing presence, including: sales to overseas tour operators, domestic receptive operators, online travel agencies and consumers. We support these efforts with tradeshow participation, sales presentations, and trade and media familiarization trips. In 2017, our region will host IPW, the world’s largest travel show. Publications — Our marketing continues after visitors arrive in town. Our Official Visitor Guide and Official Map help Alexandria’s guests get the most out of their trip. With a combined circulation of 670,000 copies, we provide advertising vehicles for members to cost effectively leverage Visit Alexandria’s destination marketing investment. Visitor & Member Services — Our Visitor Center at the corner of King and Fairfax provides personal, concierge-style information and ticketing to ensure guests stay longer, return for future visits and share their exceptional experience with their friends. It’s also the inbound call center and hub for fulfillment and member marketing, where individual businesses can optimize their listings, distribute brochures and sign up for programs. 4 Visit Alexandria FY 2016 Annual Report Major 2016 Initiatives 1. Website — Expanded content, launched responsive design and added visual storytelling through new videos and photography. Traffic rose 22% to over 1.88 million. 2. Digital Advertising — Refined data-driven media buying with A/B testing and enhanced analytics and targeting. 3. Public Relations —Leveraged Mercy Street, major trends, special events and Canada press tours to generate over 900 stories. Film office served 23 projects with an estimated economic impact of $68,000. 4. Agency Selection — Conducted rigorous request for proposal (RFP) process to select new marketing agencies for public relations, advertising creative, media buying, paid search and search engine optimization (SEO). 5. International — Continued three-year partnership with Northern Virginia Visitors Consortium leveraging a $10,000 investment to create a $150,000 Canadian marketing effort. Expanded partnership with Capital Region USA to gain new tour operator deals and international media coverage. 6. Meeting Sales — Launched new health care and wedding initiatives to uniquely position Alexandria in small and mid-size group/meeting markets. Elevated to “Valued Partner” designation with HelmsBriscoe, the world’s largest site selection firm, which produced 20% increase in leads. 7. Social Media —Insourced social media function to ensure dedicated, full-time commitment to Facebook, Twitter, Instagram and LinkedIn. Followers now up to 85,000 (+42%). 8. Member & Visitor Services —Integrated member and visitor services to maximize marketing effectiveness, ease for members and depth of information for visitors. 9. Research Tools —Commissioned independent website effectiveness study which found $42 of economic impact per unique website visitor. Six of every 100 website visitors end up taking a trip to Alexandria that they would not have otherwise taken.1 10.MGM Task Force — Convened high-level task force of community, business and City leaders to ensure Alexandria’s market readiness for MGM National Harbor Resort opening in late 2016. Met directly with MGM management and regional partners to explore marketing collaboration. 11. Mercy Street—Worked with PBS to support their national TV series spotlighting civil-war era Alexandria. Convened history partners to plan and launch over 25 new Mercy Street-inspired experiences, collaborated with PBS on marketing and PR, and produced premiere event with cast and producers in collaboration with Alexandria Film Festival. (1) Source: VisitAlexandriaVA.com Website ROI Study, Destination Analysts, San Francisco, 2016. Visit Alexandria FY 2016 Annual Report 5 FY 2016 Timeline July (cid:0) Responsive website launch (cid:0) Summer Social August (cid:0) Sidewalk Sale (cid:0) Summer Restaurant Week September (cid:0) Annual Meeting (cid:0) VA Tourism awards Visit Alexandria $50,000 grant October (cid:0) RFP meetings with prospective agencies November (cid:0) Mercy Streetpremiere at Alexandria Film Festival (cid:0) Black Friday/Small Business Saturday December (cid:0) Holiday promotion (cid:0) Convened MGM Readiness Task Force January (cid:0) Mercy Streetdebuts on PBS (cid:0) “What’s New in 2016” member meeting February (cid:0) Strategic planning retreat with four marketing/PR agencies (cid:0) Historic site partners report Mercy Street related visit increases ranging from 14% to 158% March (cid:0) MGM Readiness recommendations presented to City Council (cid:0) Breakfast & Blossoms meeting planner event April (cid:0) Health care meetings initiative launched (cid:0) Two-year website effectiveness study completed May (cid:0) Alexandria 101 tourism training (cid:0) Canadian press tours – Ontario & Quebec June (cid:0) Metro Safetrack visitor communications tools created (cid:0) Attended IPW 2016 to cultivate leads for 2017 convention in DC 6 Visit Alexandria FY 2016 Annual Report Visit Alexandria 2016 — By the Numbers Lodging Meetings Sales (cid:0) 72.9% occupancy (cid:0) $37.5 million in leads generated (new record) (cid:0) $151 average daily rate (cid:0) $13.1 million economic impact (cid:0) $110 revenue per available room (highest ever) (cid:0) 67,000 international web visits (record) (cid:0) 77 international travel trade familiarization visits Advertising Public Relations (cid:0) 113 million impressions (cid:0) 925 total stories (+4% increase) (cid:0) Mercy Streetpartnership becomes first national (cid:0) 25.3 million print circulation (+17%) TV presence (cid:0) $1.4 million print value (+24%) (cid:0) $171:1 ROI in visitor spending for each dollar of advertising (cid:0) $6:1 ROI in local tax receipts for each dollar of advertising Visitor & Member Services Digital Marketing (cid:0) 61,000 visitors served by Alexandria Visitor Center (cid:0) 1.88 million visits to Visit Alexandria (cid:0) 326 members in organization website (+22%) (cid:0) 88% renewal rate (cid:0) $42 per unique website visitor economic impact (cid:0) 85,000 social media followers (+42%) (cid:0) 372,000 blog views (+81%) Media Coverage Public relations is the most sought-after form of marketing, because it carries unmatched credibility, breadth and depth. But PR is also the hardest and most labor-intensive coverage to obtain, because it simultaneously demands authentic experience and rapid response. In FY 16 Visit Alexandria doubled down on public relations, adding a new communications position and hiring a New York-based travel PR firm late in the year. The investment is already paying off with gains in the quality and quantity of coverage. A sample of our 925 media hits appears below: 8 Visit Alexandria FY 2016 Annual Report In The News “Brick sidewalks and cobblestone alleys lead to independent stores ranging from Scottish regalia to a doggie boutique, nine historic sites within 1 square mile and a much-praised culinary scene.” — Discover Richmond "By the time the series’ [Mercy Street] second season debuts, don’t be surprised to see King Street filled with hoop-skirted cosplayers and Ken Burns fangirls." — Washington City Paper “The city’s fresh attractions pair beautifully with timeless favorites, making for a culturally rich and lively escape for all tastes and ages… Alexandria’s modern-day vitality makes its heritage shine even brighter.” — VegWorld “From President Washington to President Obama, Alexandria’s visitor appeal is not only presidential but also cultured and refined with an artsy, fun vibe.” — AAA World “On the Potomac River, just minutes from Washington, D.C., the city hums with a cosmopolitan feel against an extraordinary historic backdrop. Luxurious accommodations are just steps from historic sites, galleries, boutiques and restaurants, where visitors can turn a ‘Mercy Street’ excursion into a weekend getaway.” — Pittsburgh Tribune Review “Nearly three centuries of history draw visitors to the brick streets of Old Town in Alexandria. But after dark, secret doors open to intimate lounges where cocktail hour shimmers late into the night.” — Dallas Morning News “Few places offer the chance to shop for chic shoes, designer clothes, delightful home decor, offbeat antiques and choice vintage amid a setting of outstanding period architecture and landmarks.” — The Roanoke Times “This fantastic little town is teeming with great restaurants, historic homes, boundary-pushing cocktail bars, and killer coffee shops.” — Thrillist Visit Alexandria FY 2016 Annual Report 9 Financial Results for FY 2016 Visit Alexandria completed Fiscal Year 2016 with strong results. Revenues were up 4% from budget due to across-the-board growth in all our earned income categories including: membership, sponsorship, commissions, grants and Visitor Center sales. Meanwhile, we held expenses within 1% of budget. That combination enabled Visit Alexandria to generate net income of $89,000 and to increase our operating reserves from 1.07 months to 1.41 months. This marks important progress toward our long-term operating reserve goal of 3.0 months, as recommended by our auditors to be consistent with industry peers.1 9% Revenue Expense Breakdown 91% City Allocation $ 3,192,274 (cid:0)Marketing Earned Income 418,652 (cid:0)General & Administrative (commissions, dues, grants, sales) $ 3,610,926 Expenses (1) At the time of publication, our auditors, Clifton Larson Allen, were completing their annual review of Visit Alexandria’s FY16 financial reporting and controls, and we anticipate another clear and positive report. Marketing $ 3,207,014 General & Administrative 307,032 $ 3,514,046 Net Income Net Income $ 96,880 10 Visit Alexandria FY 2016 Annual Report