ITEM 11. SPONSORSHIP - VOGUE FASHION'S NIGHT OUT

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1 ITEM 11. SPONSORSHIP - VOGUE FASHION'S NIGHT OUT FILE NO: S SUMMARY On 9 December 2013, Council adopted the Retail Action Plan. Key initiatives from this plan include promoting Sydney as Australia s premier retail destination and to create lively and active places that encourage more visits to Sydney s CBD and villages. At last count, there were more than 7,800 retail related business establishments from the approximately 21,500 business establishments within the city and as a major employer makes an important contribution to the local economy. It is a diverse industry that ranges from department stores and major shopping complexes through to small businesses, market stall holders and pop-up stores around the city and villages. The fashion retail sector forms a significant part of the City s overall retail economy. However, over recent years, the sector has faced numerous challenges. The combined impacts of the global financial crisis, a shift to online purchasing and a general reduction in consumer confidence has led to a decline in retail spending. A key component of the advice received from the Retail Advisory Panel, is that industryled events supported by Government encourage increased foot traffic in key shopping precincts. For the past four years, the City has supported two signature consumer events that focus on fashion in Sydney: Mercedes Benz Fashion Festival and Vogue Fashion s Night Out. Since its inception, Vogue Fashion s Night Out has grown significantly in terms of audience numbers and increased participation by retailers. In September 2014, Vogue Australia reported that over 180,000 people joined 600 participating retailers for the fifth annual Vogue Fashion s Night Out in Sydney. Over $6 million worth of audited publicity was achieved for this event; 76% of participants had attended 2013 VFNO and returned in 2014; and 77% of people purchased on the night of the event with 42% spending more than they had budgeted for. Vogue Australia (published by News Life Media Pty Ltd) has sought the continuation of sponsorship from the City for Vogue Fashion s Night Out for the next three years commencing in The request for sponsorship has been evaluated against the Commercial Creative and Business Events Sponsorship programs and support is recommended. RECOMMENDATION It is resolved that: (A) Council approve cash sponsorship of $100,000 (excluding GST) per annum and value-in-kind sponsorship of $50,000 (excluding GST) per annum in 2015/16, 2016/17 and 2017/18 for Vogue Fashion s Night Out 2015, 2016 and 2017; and

2 (B) authority be delegated to the Chief Executive Officer to negotiate, execute and administer a sponsorship agreement with News Life Media Pty Ltd for Vogue Fashion s Night Out ATTACHMENTS Attachment A: Analysis of 2014 Vogue Fashion s Night Out (Confidential) (As Attachment A is confidential, it will be circulated separately from the business paper and to Councillors and relevant senior staff only.)

3 BACKGROUND 1. On 9 December 2013, Council adopted the Retail Action Plan. Key initiatives from this plan include promoting Sydney as Australia s premier retail destination and to create lively and active places that encourage more visits to Sydney s CBD and villages. 2. Clothing, footwear and accessory retailers comprise one of the most dominant components of Sydney s retail offering. This segment of the retail market is particularly vulnerable to changes in consumer spending patterns. The impacts of the global financial crisis, a reduction in consumer confidence and movement towards online shopping has led to a decline in clothing and accessory retail sales in the last few years. 3. The city s retailers, through the Retail Advisory Panel and other mechanisms, have sought support from the City to assist in the generation of increased retail activity and ensure that Sydney maintains its reputation as a market leader. The City has responded in a number of ways, including creating a 12 month trial for the Retail Activation Program in Pitt Street Mall, provision of grant funding for local businesses and business chamber events such as the Business Improvement grant and a major investment in the development of Sydney Christmas. 4. Feedback received from retailers has indicated that activities around events such as Vogue Fashion s Night Out have resulted in increased sales activity and customer attraction to the CBD. To gauge business interest in continuing this event in Sydney, City staff contacted shopping centres and individual retailers to understand their perspectives on the event. The group contacted represented more than 100 retailers in the CBD who participated in the 2014 event. From this engagement, there appears to be overwhelming support for this event to continue in Sydney by the CBD fashion related business community. 5. The City has been a sponsor of Vogue Fashion s Night Out since its inception in Sydney in For the last three years, the City has provided both cash and inkind support for two highly successful retail fashion related events: Sydney Fashion Festival and Vogue Fashion s Night Out, both of which occur in September. 6. Since 2012, the events have been linked by the City to create a month long coordinated umbrella marketing campaign, consumer shopping activities and program of supporting events branded as Sydney is Fashion. While the major sponsored events take place in across September annually in the CBD, there is also a coordinated campaign to support a program of events known as Fashion in the Villages. 7. It is proposed that, by continuing the sponsorship of this event in , new opportunities will be secured through the partnership with Vogue to support the Fashion in the Villages campaign. Vogue will contribute to consumer and retail workshops and activations and events will be planned to support the village campaign, with the aim to increase retail sales activity and increase consumer footfall, particularly during this non-sales period. Vogue will provide talent from within their editorial and media teams to support these workshops for the Village retailers and consumers throughout the LGA.

4 Vogue Fashion s Night Out Vogue Fashion s Night Out is an international event that has been held in cities around the world each September since The global event has grown from being hosted in 12 cities in the first year to 20 cities in Sydney participated for the first time in 2010 and had approximately 100,000 consumers and 450 retailers participate. This has grown to 180,000 consumers and over 600 retailers participating. 9. An initiative of New York City, Vogue Fashion s Night Out is designed to celebrate shopping and support the fashion industry. It is described as a highly engaged fun and exciting shopping experience for consumers. 10. In 2015, Vogue Fashion s Night Out will take place in Sydney in early September on a Thursday evening from 5pm 10pm. In subsequent years, it will occur at a similar time. 11. Vogue Fashion s Night Out is not a retail sale event; rather, it focuses on a series of live in-store and on-street events and activations designed to attract new shoppers. This includes unique pop-up stores, fashion parades, fashion forums, window displays, incentives, live performances, celebrity guest appearances and a wide range of other special experiences. 12. In 2014, over 600 retailers participated in the Sydney event and feedback has been sought by the City from participating retailers, shopping centres, sponsors and consumers. Recorded footfall increased at the following retailers in 2014: Westfield Sydney +5%; QVB +11.5%; and The Strand +4.9%. 13. The support of Vogue magazines around the world ensures that the event receives extensive media coverage online and in magazine and throughout the NewsLifeMedia stable of magazines and News Ltd press in Australia. 14. In Australia, Vogue is published by News Life Media Pty Ltd who provide the majority of financial and media resources to deliver the event locally. Retailers participation is free of charge and is not conditional on commercial arrangements with the publishers. 15. Between , the City provided total annual sponsorship for Vogue Fashion s Night Out to the value of $70,000; made up of cash sponsorship of $40,000 and value-in-kind sponsorship of $30,000. Vogue Australia has provided the City with an acquittal following each year s event which satisfied all of the performance criteria outlined in their funding agreement. 16. The organisers of Vogue Fashion s Night Out have outlined plans to continue to grow the event over the next three years to include CBD retail precincts such as the QVB, the Strand, Pitt Street Mall and Martin Place activations; expand the number of stores participating and continue to work with retailers to improve the instore experiences. In addition to this, Vogue will further develop their digital platforms to ensure optimised customer engagement pre and during the event period.

5 17. The City will continue to work closely with Vogue Australia to ensure support across the integration of Sydney is Fashion campaign and, in particular, lend greater support to the Fashion in the Villages campaign by providing access to talent for workshops, visual merchandising opportunities, retailer engagement and fashion schools located our local government area. SPONSORSHIP 18. Vogue Australia has requested cash sponsorship of $250,000 per annum from the City to deliver Vogue Fashion s Night Out each year, for three years, from The request for sponsorship has been evaluated against the aims of the Commercial Creative and Business Events Sponsorship Program and sponsorship is recommended, albeit at a lower level than requested by Vogue. 20. Based on the assessment of the event against the criteria for the program, it is recommended that Council approve cash sponsorship of $100,000 (excluding GST) per annum and $50,000 (excluding GST) per annum in value-in-kind support for marketing, media, venue and banner pole hire. This support is recommended each year for three years commencing in the 2015/16 financial year and ending in the 2017/18 financial year. 21. The event and the City s involvement will have significant print and digital exposure across a variety of Vogue Australia platforms as well as News Ltd media. Vogue Magazine currently has a circulation of 52,133 and a readership of 432,000. In addition to this, the Vogue website has over 1,000,000 unique visitors every month and is supported by an online community of 4.4 million page views each month. Vogue also has close to 216,000 Instagram followers; 991,000 Facebook; 83,000 Twitter and 224,000 Tumblr followers. 22. Vogue Australia estimates the total value of marketing and event sponsor benefits for the City to be $763,000 in 2015; $839,300 in 2016 and $923,233 in The City s sponsorship of Vogue Fashion s Night Out will demonstrate a commitment to the creative industries and retail sectors, both of which are important elements of the City s economy. KEY IMPLICATIONS Strategic Alignment - Sustainable Sydney 2030 Vision 24. Sustainable Sydney 2030 is a vision for the sustainable development of the City to 2030 and beyond. It includes 10 strategic directions to guide the future of the City, as well as 10 targets against which to measure progress. (a) (b) Direction 1 - A Globally Competitive and Innovative City - considers Sydney s role as Australia's premier international tourism and business gateway. It outlines the steps to strengthen business competitiveness and enhance tourism infrastructure, assets and branding of the City. Direction 7 - A Cultural and Creative City - recognises the arts and cultural activities as fundamental to liveability, diversity, and quality of life in our cities, as well as their contribution to economic development.

6 (c) Objectives include supporting cultural activity, participation, and interaction; supporting the development of creative industries; providing cultural leadership and strengthening cultural partnerships. Organisational Impact 25. Sponsorship of the event will result in the nomination of a Council officer to provide contract management and coordination services. 26. The City s marketing and communications teams will support Vogue Fashion s Night out through an umbrella marketing campaign across multiple media forms that centres on the City s fashion retail experience and seeks to draw participants to each of the key events across the campaign. Social / Cultural / Community 27. Vogue Fashion s Night Out is a free event that is designed to maximise community participation. It takes place in the evening from 5 pm 10 pm, enlivening the centre of Sydney. 28. The Commercial Creative and Business Events Sponsorship Program recognises the important contribution to the City s cultural life and creative participation that major events such as Vogue Fashion s Night Out can play. Economic 29. Vogue Fashion s Night Out is designed to deliver economic benefits to the fashion and retail sectors of the City s economy. 30. Vogue Fashion s Night Out campaign will draw significant numbers of consumers into the City and drive retail sales. Specifically this event will result in: (a) (b) (c) benefits to business by encouraging spending on fashion in a non-sale period; profile benefits for the retail offering of the City of Sydney as a result of extensive local, national and international media coverage; and brand benefits supporting Sydney s positioning as a creative city and its positioning amongst leading global cities. BUDGET IMPLICATIONS 31. Funds are available within the 2014/15 sponsorship budget held by Research Strategy & Corporate Planning for costs incurred in this financial year. 32. Provision will be made in the 2015/16, 2016/17 and 2017/18 sponsorship budgets for the costs incurred in those financial years. RELEVANT LEGISLATION 33. Local Government Act 1993, ss356(1) and 356(3)- sponsorship of Vogue Fashion s Night Out is part of the Commercial Creative and Business Events Sponsorship Program.

7 34. Local Government Act 1993, s10a(2)(d)(i). 35. Attachment A contains confidential commercial information of News Life Media Pty Ltd which, if disclosed, would prejudice the commercial position of the person who supplied it. 36. Discussion of the matter in an open meeting would, on balance, be contrary to the public interest because it would compromise Council s ability to negotiate fairly and commercially to achieve the best outcome for its ratepayers. CRITICAL DATES / TIME FRAMES 37. Vogue Fashion Night Out 2015 will take place in early September 2015 from 5pm 10 pm. KIM WOODBURY Chief Operating Officer Jennie Harris, Economic Strategy Coordinator, Retail and Tourism