MUNICIPAL MARKETING
Kitchener’ s revenue generation strategy includes selling naming rights to facilities like Gibson’ s Finest Club Lounge & Restaurant in The Aud
helped the city define a slate of options deemed appropriate, including advertising in city publications and on arena boards, alcohol and soft drink“ pouring rights” and naming rights for some facilities.
Policy considerations The City of Kitchener did not previously have an advertising or sponsorship policy, but staff have now developed one and presented it to council. An existing policy used to dictate that none of the city’ s websites or vehicles could carry advertising; this rule was changed. Kitchener has even discussed such creative approaches as allowing paid advertising on the back of official documents like building permits.
When a policy is being drafted, the municipality“ needs to find balance between financial and social benefits,” Hagey says.“ Do you sell naming rights to heritage designated buildings? Do you put logos on synthetic turf sports fields?”
Kitchener’ s new policy clearly defines ideas that would not be allowed; controversial, politically sensitive or potentially hazardous brands are off the list, Hagey says.“ That’ s where the policy piece comes in. We don’ t want to have porn. If you’ re trying to promote a healthy lifestyle, you might not want to promote a lot of [ fast-food restaurants ]. It all boils down to what you are okay with.”
Libro Credit Union’ s display at The Aud this spring consisted of temporary sign columns that didn’ t even feature a logo: just an intriguing slogan and a QR code that could be accessed with a smartphone
Comprehensive or case-by-case? Rather than proceed case by case without any set plan, Kitchener has adopted a comprehensive approach that will apply consistent policies to all marketing outreach activities, which will be centrally coordinated. This is more time-consuming to set up, but allows for better consistency across multiple locations and divisions, Hagey points out.
Who does the selling? Although some municipalities might be equipped to set up an in-house sponsorship initiative, Kitchener is putting the function out to tender; it will be up to bidders to calculate and commit to a certain level of potential revenue.“ It would be a time-limited venture,” he says.
Revenue allocation The final consideration, he says, is“ what happens to generated funds?” Will they be applied to reduce tax rates or will they allow for an investment in infrastructure?
“ What budget do funds get applied to?” Hagey asks. For example,“ if the water utility generates funds, do they keep them or are they returned to taxes?”
In Kitchener, the decision was made to use advertising revenues to reduce tax rates. Sponsorship revenues are returned to the budget of the facility or program that generates them, while“ funds generated by enterprises stay within that enterprise,” he says. That means“ Water revenues stay in water.” However, a different municipality might choose to apply revenues to anything from infrastructure rehabilitation to new program development.
Done right, entrepreneurial revenue generation can build on authentic connections between businesses and the community to reduce pressure on the tax base: a win for all concerned.
ALL PHOTOS COURTESY OF THE CITY OF KITCHENER
20 Q2 2015 www. amcto. com
A Toyota test-drive location outside of the Activia Sportsplex in March