DENVER—Imagine: Red Rock Canyon, brought to you by REI. Or Duracell—the official battery of the Colorado Springs Police Department.
These are just some ideas being tossed around as Colorado Springs joins a growing list of cities seeking creative ways to raise revenue.
The city council gave the go-ahead this week to award a $50,000 contract to The Active Network, Inc., a San Diego-based marketing firm, to find corporate sponsors for certain city property.
“You know these are tough economic times, but certainly for municipal governments that rely so much on revenue from sales tax,” said Paul Butcher, city director of parks, recreation and cultural services.
Colorado Springs’ fiscal year 2009 budget faces a $41 million deficit, Butcher said. Officials hope to offset some of that through corporate sponsors.
“Marketing firms indicate a city this size might generate $1.5 million in the first year,” Butcher said of the city of 360,000. Ad revenue could top $5 million in subsequent years, he said.
The Active Network, Inc. sealed its first city-corporate sponsorship deal with Huntington Beach, Calif. in 1999. Nissan now sponsors that city’s lifeguard rescue vehicles. Another client, Glendale, Calif., worked out a deal with Viacom to sponsor city bus shelters.
Active Network also is developing corporate deals for Pittsburgh, Arlington, Texas, and Santa Clara (Calif.), Nassau (N.Y.) and King (Wash.) counties.
“We’re getting many more inquiries now because these cities are turning around and saying, ‘We’ve got to be creative because of the economic situation,'” said Don Schulte, director of Active Marketing Partnerships, a division of The Active Network. “A lot of these companies are very interested in helping these cities and counties but don’t know how.”
But do municipal sponsorships help a company’s bottom line?
David Wilkinson, president and CEO of The Wilkinson Group, a San Francisco-based marketing company, says the public sector tends to look at the private sector as a fund raiser and forgets it’s about running a business.
“You have to commercialize to get a return. You can’t go, ‘Give me a million dollars and I’ll put a little plaque honoring you in front of city hall,” he said.
Still, Wilkinson predicts public-private marketing deals will grow in popularity. Local governments hold a lot of equity, offering good opportunities for the private sector, he said.
Some activists are wary of branding public property.
“Nobody wants to go to our city parks to get away from daily pressures and suddenly be inundated with advertisements,” said Roger Singer, the Sierra Club’s regional representative in Boulder. “Open spaces are not the same as sports stadiums.”
“School districts went that route and some of the contracts have actually lapsed because of the public outcry,” said Jane Ard-Smith, chair of the Sierra Club chapter in Colorado Springs.
Ard-Smith referred to parental outrage following a 1997 deal to stock Coca-Cola in some Colorado Springs public schools. That contract expired in 2007.
Schulte points out that many cities are careful to avoid advertising that would draw criticism.
“It’s not about signage or naming rights,” he said. “A lot of companies don’t want to spend money in the community to have people get mad at them.”
Butcher is excited about the possibilities for Colorado Springs.
“What would be wrong with talking to Evian and giving them exclusive rights to distribute their product in Red Rock?” he said, referring to an open space park known for its rock formations.
Other ideas: Stocking park kiosks with brochures from companies like REI, or negotiating with Purina Pet Food, for example, to sponsor the city’s four dog parks, Butcher said.
Colorado Springs wants low key marketing solutions, like installing a corporate-sponsored webcam at a new skate park so skaters can check out the weather. In exchange, the city would sell ad space on the Web page.
Active Network worked out a similar deal for a Costa Mesa, Calif., skate park with Volcom, a skating apparel company. Volcom pays for park maintenance and design; the company erected a shade shelter and held an art contest among its customers to decorate it.
Ads could start popping up in Colorado Springs later this year. It plans to fund the $50,000 contract with money from city golf courses, a cemetery and city parking.
———
On the Net:
Colorado Springs:
Red Rock Canyon:
Active Network:
The Volcom Skate Park of Costa Mesa:
