Blue Ribbon Panel Recommendations to National Cherry Festival

Tuesday November 13, 2007

Statement to the National Cherry Festival Board of Governors from the Blue Ribbon Advisory Panel:

Dear board of governors:

Thank you for the opportunity to work on such a storied and successful organization. Our charge from you was to dissect the festival's business model, examining what is working and what is not working, bringing the full breadth of our collective experience to bear on developing potential solutions for identified issues.

This group of ten business and community leaders met three times over the course of six weeks. Our first meeting on October 5th, 2007 was strictly informational. NCF board members, staff, and legal counsel presented the Blue Ribbon Panel with an in-depth report on the history, current-state, and expected future-state of the Festival. These people did a terrific job of relaying some very complex and rich information in a very short time frame. This work provided the panel with an effective immersion into the workings of the Festival so that we could realize the goals of the panel. All panel members left the first meeting with a series of questions to consider in preparation for engaging in the next meeting.

Our second meeting on October 9th, 2007 was designed to ask questions that fell into three distinct areas regarding the business model of the NCF: #1. What is working? #2. What is not working? #3. What can we change that would ensure the sustainability of the Festival? It was at this meeting that the panel began accumulating a set of recommendations to forward to the NCF board of governors. An initial set of general recommendations were communicated to the board of governors after this meeting by our board liaison Tino Breithaupt.

Finally in our last meeting on November 12th, 2007 the panel reconsidered the proceedings and results from the previous sessions and finalized a set of strong recommendations that are being transmitted through this document.

After much consideration over the past month, the Blue Ribbon Panel unanimously agreed to provide the NCF Board of Governors with the following findings and recommendations:

1. The current business model of the National Cherry Festival is not sustainable beyond the 2008 event. We recommend that an imminent sense of urgency be realized within the NCF organization, and publicly, regarding the need for a change in the business model in order for the Festival to survive beyond 2008.

2. Recognizing the above need for urgency this panel also realizes that the legacy of the NCF is largely free and public. We believe that some, but not a majority of, NCF events must be ticketed in order to fund the increasing costs associated with Festival operations and to reflect current and quickly-changing economic realities. We understand this concept has been considered previously and wish to emphasize the high degree of urgency needed to see the necessary and time-critical financial benefits of such a change

3. This group recognizes that historically the NCF partnered closely with the City of Traverse City and other local groups. We believe rebuilding these links is an essential step in creating a strong and sustainable Festival. The economic ramifications are so intertwined that this group recommends the NCF board of governors build a new master agreement with the City that is mutually beneficial. This agreement could include: a revenue sharing plan, ticketed events on park property, and other changes all designed to provide the City with tangible financial benefit for its stake in the Festival's success. Making this benefit clear to the City is of utmost importance.

4. The burden of proof of the Festival's economic impact on the City and the entire community falls squarely on the Festival itself. There is much speculation and dispute about the kind of economic impact the Festival has upon the community each July. This panel believes it is a very significant positive economic impact. In order for this belief to be realized and proven a solid economic impact study needs to be completed using data from the 2008 event. This will provide a metric that the Festival and the community can measure itself against year after year. Part of this research should include gathering a better understanding of the demographics of visitors to the area during the Festival. We propose this become a joint effort with other interested partners such as the TC Area Chamber of Commerce, the Traverse Bay Economic Development Corporation, the Convention and Visitors Bureau and/or others. Such partnerships will help to spread the financial burden of a quality report, and perhaps most importantly provide a level of validity to the data that could stand undisputed in the eye of the public.

5. Clearly the Festival needs to examine ways that it can significantly increase its revenues. These may include: ticketing events, making better use of its year-round staff and infrastructure as an event planning operation, donations to a new nonprofit organization, expansion of its pin program and other ideas.

6. The panel recommends that it continue its current work in establishing a nonprofit 501(c)3 corporation for the purposes of acquiring grants and donations related to the support of local agriculture and/or other activities to support its intended mission. This will be critical in creating a new source of funds that the Festival can rely upon.

7. If the Festival is incapable of building a working and sustainable business model, it should then consider the possibility of a completely different ownership model. This might include: exploring the possibility of the festival becoming a department within the City government, or selling the current organization and its assets. These are just a few examples of drastic measure that could be employed.

8. Cherry Festival research has shown that local people overwhelmingly like and appreciate the Festival. However, given increased event competition, media scrutiny, and other pressures, the Festival should begin to leverage its positive relationship with the community. A grassroots-based public relations strategy would go a long way to make the best out of the Festival's many positive contributions and impacts to the local community. Finding ways to use the immense energy of its volunteers and the many thousands of delighted festival-goers is essential to creating a strong and deserved support mechanism. Such a public relations strategy should be differentiated from a general marketing plan. It involves creating a consistent and strong communications mechanism to inform the local community of the efforts, accomplishments, and benefits of the Festival.

The eight recommendations listed above are provided to the NCF Board of Governors after careful analysis of the key issues and challenges facing the Festival. The entire Blue Ribbon Panel wishes to extend thanks and appreciation to the board and staff of the NCF for its visionary use of such an advisory group. While the panel considers its job accomplished, all the members wish to offer their continuing support to the Festival as ongoing advocates to ensure the future sustainability of northern Michigan's cornerstone summer event.

These recommendations were collected and submitted by Bill Palladino (Facilitator) for the Blue Ribbon Panel:

Tino Breithaupt Jeff Hughes Don Coe T. Michael Jackson Charlie Correia

John Murray Connie Deneweth Wendy Steele Luke Haase Brad Van Dommelan