Chippewa Valley Regional Airport; Eau Claire, Wisconsin

Application Under the Small Community Air Service Development Program; Docket DOT

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- 0113 APPLICATION UNDER SMALL COMMUNITY AIR SERVICE DEVELOPMENT PROGRAM

DOCKET DOT

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SUMMARY INFORMATION

A

. P ROVIDE THE LEGAL SPO NSOR AND ITS DUN AND BRADSTREET (D&B) DATA UNIVERSAL NUMBE RING SYSTEM (DUNS)

NUMBER , INCLUDING +4, EMPLOYEE IDENTIFICAT ION NUMBER (EIN) OR TAX ID
. Legal Sponsor Name: Chippewa Valley Regional Airpo rt / Eau Claire County Name of Signatory Party for Legal Sponsor: Charity Speich , Airport Manager
DUNS Number: 80

- 698

- 9513 EIN/Tax ID: 39

- 6005694

B

. L IST THE N AME OF THE COMMUNITY OR CONSORTIUM OF COM MUNITIES APPLYING : 1._ C HIPPEWA V ALLEY R EGIONAL A IRPORT /EA U C LAIRE C OUNTY

_

C

. P ROVIDE THE FULL AIRP ORT NAME AND 3

- L ETTER IATA A IRPORT C ODE FOR THE APPLICAN T ( S ) AIRPORT ( S ) (O NLY

PROVIDE CODES FOR TH E AIRPORT ( S ) THAT ARE ACTUALLY SE EKING SERVICE ).
1

. Chippewa Valley Regional Airport (EAU)

D OES THE AIRPORT SEEK ING SERVICE HOLD AN AIRPORT OPERATING CERTIFICATE ISSUED B Y THE F EDERAL A VIATION A DMINISTRATION UNDER 14 CFR P AR T 139? (I F “ NO ,” PLEASE EXPLAIN WHETH ER THE AIRPORT INTEN DS TO APPLY FOR A CERTIFICATE OR WHETH ER AN APPLICATION UN DER P ART 139 IS PENDING .)

Yes No (explain) 

### XChippewa Valley Regional Airport; Eau Claire, Wisconsin

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. L IST THE 2

- DIGIT CONGRESSIONAL DISTRICT CODE APPLIC ABLE TO THE SPONSORI NG ORGANIZATION , AND IF A

CONSORTIUM , TO EACH PARTICIPATIN G COMMUNITY
. 1

. WI

- 03

E

. A PPLICANT I NFORMATION : (C HECK A LL T HAT A PPLY )


### Not a Consortium Interstate Consortium Intrastate Consortium
Community now receives subsidized Essential Air Service
Community (or Consortium member) previously received a Small Community Air Service Development Program Grant

If previous recipient: Provide Year of grant(s): 2004 a nd, the te x t of the Grant agreement section(s) setting forth the scope of the grant project:

S ecuring additional service to Milwauk ee, WI (MKE) on Skyway Airlines
, Improve connectivity to the national air transportation system for Eau Claire an d the surrounding communities, P rovide intermodal access to area residents via Amtrak s ervice available at Milwaukee, and I ncrease use of services at the Airport to recapture traffic and elevate the Chippewa Valley Re gional Airport to a secondary airport for the congested Minneapolis/St

. Paul Airport.

F

. P UBLIC /P RIVATE P ARTNERSHIPS : (L IST O RGANIZATION NAMES ) PUBLIC PRIVATE
1

. Eau Claire County 1

. Chippewa County Economic Development Corporation
2

. University of Wisconsin

- Eau Claire 2

. Xcel Energy


### 3. 3

. Chippewa Falls Area Chamber of Commerce 4. Sacred Heart Hospital G

. P ROJECT P ROPOSAL : 1

. G RANT G OALS : ( CHECK ALL THAT APPLY ) Launch New Carrier Secure Additional Service Upgrade Aircraft First Service New Route Service Restoration Regional Service Surface Transportation Professional Services Other (explain below)

Marketing and P romotion of air service at Chippewa Valley Regional Airport 

### XChippewa Valley Regional Airport; Eau Claire, Wisconsin

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. F INANCIAL T OOLS T O B E U SED : ( CHECK ALL THAT APPLY ) Marketing (including Advertising): promotion of the air service to the public Start

- Up Cost Offset: offsetting expenses to assist an air service provider in setting up a new station and starting new service (for example, ticket counter reconfiguration) Revenue Guarantee: an agreement with an air service provider setting forth a minimum guaranteed prof it margin, a portion of which is eligible for reimbursement by the community Recruitment of Air Carrier: air service development activities to recruit new air service, including expenses for airport marketers to meet with air service providers to make the case for new air service Fee Waivers: waiver of airport fees, such as landing fees, to encourage new air service; counted as in

- kind contributions only Ground Handling Fee: reimbursement of expenses for passenger, cabin, and ramp (below wing) services p rovided by third party ground handlers Travel Bank: travel pledges, or deposited monetary funds, from participating parties for the purchase of air travel on an air carrier, with define d procedures for the subsequent

use of the pledges or the deposited funds; counted as in

- kind contributions only Other (explain below) Update Passenger Leakage Study to use in conjunction with marketing activities

H

. E XISTING L ANDING A IDS AT L OCAL A IRPORT : Full ILS Outer/Middle Marker Published Instrument Approach Localizer Other (specify)Chippewa Valley Regional Airport; Eau Claire, Wisconsin

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. P ROJECT C OST : D O NOT ENTER TEXT IN SHADED AREA L INE D ESCRIPTION S UB T OTAL T OTAL A MOUNT 1 Federal amount requested $150,000
2 State cash financial contribution $0 Local cash financial contribution
3a Airport cash funds $0
3b Non

- airport cash funds $15,000
3 Total local cash funds ( 3a + 3b ) $15,000
4 TOTAL CASH FUNDING ( 1+2+3 ) $165,000
In

- Kind contribution
5a Airport In

- Kind contribution**
5b Other In

- Kind contribution**
5 TOTAL IN

- KIND CONTRIBUTION ( 5a + 5b )
6 TOTAL PROJECT COST ( 4+5 ) $165,000

J

. IN

- KIND CONTRIBUTIONS** For funds in lines 5a (Airport In

- Kind contribution) and 5b (Other In

- Kind contribution), please describe the source(s) of fund(s) and the value ($) of each.

K

. I S T HIS A PPLICATION S UBJECT T O R EVIEW B Y AN AFFECTED S TATE U NDER E XECUTIVE O RDER 12372 P ROCESS ?

a. This application was made available to the S tate under the Executive Order 12372 Process for review on (date) _____________. b. Program is subject to E.O

. 12372, but has not been selected by the S tate for review.

c. Program is not covered by E.O

. 12372.

L

. I S T HE L EAD A PPLICANT OR ANY C O - A PPLICANTS D ELINQUENT O N A NY F EDERAL D EBT ? (I F “Y ES ”, P ROVI DE E XPLANATION )
No Yes (explain)

_____________________________________________________________________________________________Chippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 1 Legal Sponsor

The Chippewa Valley Regional Airport (CVRA) is the legal sponsor responsible for administering the proposed air service marketing and promotion plan

. The Airport is a government agency, owned and operated by Eau Claire County, Wisconsin

.
Chippewa Valley Regional Airport 3800 Starr Avenue Eau Claire, WI 54703 Charity Speich, Airport Manage r ( 715) 839

- 6241 Charity.S peich@chippewavalleyairport.comChippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 2 Contents LEGAL SPONSOR .....................................................................................................1

INTRODUCTION

................................ ................................ ................................ .............................. 2
AIR CARRIER LETTER OF 

### SUPPORT

................................ ................................ ............................... 4
OVERVIEW OF THE CHIPPEWA VALLEY REGION

................................ ................................ ........ 5 CURRENT AND HISTORICAL AIR SERVICE AND DEFICIENCES

................................ ................... 6 TRAFFIC RETENTION AND LEAKAGE

................................ ................................ ............................ 9 AIR SERVICE DEVELOPMENT EFFORTS AND AIR SERVICE MARKETING

................................ .. 10 STRATEGIC PLAN TO IMPROVE AIR SERVICE THROUGH MARKETING

................................ .... 12 PUBLIC/PRIVATE PARTNERSHIPS

................................ ................................ ................................ . 18 PREVIOUS SMALL COMMUNITY AIR SERVICE GRANT

................................ .............................. 19 CONCLUSION

................................ ................................ ................................ .............................. 20



## INTRODUCTION

The Chippewa Valley Regional Airport (EAU) herein submits an application for a 2014 Small Community Air Service Development (SCASD) Grant

. The Chippewa Valley Regional Airport is in the Department of Transportation’s Essential Air Service (EAS) program and, accordingly, proposes to use modest Federal Grant funding, matched by local non

- airport cash to develop and implement an aggressive air service marketing program, designed to raise enplanements and thus, in the long term, reduce EAS subsidy needs.

Eau Claire’s current air service is operated by SkyWest Airlines operating 50

- seat regi onal jet aircraft on twice daily service to Chicago O’Hare International Airport

. S kyWest operates the service under a codeshare agreement with United Airlines, a nd the service is marketed using the United Express brand

. The SkyWest service replaced pr evi ous Mesaba Airlines service operated under a code share agreement with Northwest Airlines in early 2010

. Mesaba operated nons top service to Minneapolis/St. P aul using 34

- seat Saab 340 aircraft

.

Dating back ten years, Eau Claire was served without an EAS subsidy by Mesaba under a code

share agreement with Northwest Airlines. On July 14, 2009 , Mesaba filed a Ninety

- Day Notice of Termination of Service with the Department of Transportation stating it would end service to Eau Claire (along with servi ce to seven other communities) on October 12, 2009 unless it wasChippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 3 awarded an EAS subsidy. SkyWest was ultimately awarded the EAS contract for service at Eau Claire at an annual rate of $ 1,732,372 and began service on March 1, 2010. SkyWest was subsequently awarded a second contract for EAS service at Eau Claire on January 26, 2012 at an annual subsidy of $1,733,576 and awarded a third contract on October 21, 2013 at an annual subsidy of $1,546,536

. It should also be noted the Department of Transportation and Mesaba agreed to a subsidy of $574 per flight during the hold

- in period from October 12, 2009, thru February 28, 2010

.

The Airport is seeking $150,000 in federal assistance to develop and implement a strategic

m arketing plan for the promotion of the airport

. The proposed marketing plan would utilize g rant funds t o develop a full strategic marketing strategy and advertising p lan to use as a guide for all future initiatives and ensure all airp ort marketing activities are aligned with achievable goals and industry demands

. The grant funds would be used to advertise the airport based on the

r ecommendations of the strategic marketing plan. The Airport has assembled a coalition of local support to showcase the importance of effectively marketing the airport. A portion of Eau Claire County ’s financial contribution will be the local, matching funds for the grant. Although SkyWest and United are strong airline partners with a well

timed flight schedule, SkyWest is not generating enough traffic in Eau Claire to eliminate the subsidy provided by the EAS Program; significant traffic leaks from Eau Claire to other airports in the region. Small Community Air Service Development Grant funding could be used to build awareness of Eau Claire’s existing air service and reduce leakage from the Airport. 

## “The EAU Average Domestic Fare Increased 39.7% to $209 in Fourth Quarter 2013... contributing to the significant

am ount of passenger leakage .”Chippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 4 AIR CARRIER LETTER O F SUPPORTChippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 5 OVERVIEW OF THE CHIP PEWA VALLEY REGION

Located in the Western part of Wisconsin near the Chippewa River, Chippewa Valley Regional Airport is approximately 180 miles from the capital city of Madison and approximately 90 miles east of Minneapolis/St. Paul International Airport

. The Chippewa Valley Regional Airport is owned by Eau Claire County, operated by Chippewa and Eau Claire Counties, and physically resides in Chippewa County, Wisconsin

. Combined, the total population as of 2013 was 164,570

. Median household income for the two counties equates to $49,074

. The cost of living has continued a gradual decline as the long term trend line was well under the national average in 2012

. Eau Claire received an overall ranking of 91.0, which was well under the national average of 100

. Low cost of living is advantageous for the city as well as its residents and encourages cultural diversity

. The ability for individuals to live affordably is indicative that they will remain in the area longer while contributing to an ever increasin g population base with which the Airport can draw from

.

Key economic sectors for the counties of Eau Claire and Chippewa are wide ranging

. The area is home to numero us employers including the corporate o ffice of home improvement retailer Menards,
Inc

. T he University of Wisconsin

– Eau Claire is another large employer in the region. One corporation, Hutchinson Technologies, is a global supplier of suspension assemblies for disk drives

. Their product is in virtually every size and type of disk drive; from those used in desktops to those used in enterprise computing throughout the world

. In 2013, Eau Claire was named second in the United States for construction job g rowth ; it was up 31% versus 2012 according to data from the Associated General Contract ors of America

. In addition to a div erse economy, Eau Claire’s economy is thriving. Eau Claire’s May 2014 unemployment rate stood at 4.7% versus the Wisconsin statewide unemployment rate of 5.5% and the U.S. national unemployment rate of 6.3%

.Chippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 6 CURRENT AND HISTORICAL AIR S ERVICE AND DEFICIENC ES

As illustrated in Exhibit 1, airline capacity in Eau Claire has declined from 229 scheduled seats per day each way to just 100 seats per day each way, a decline of 56.3%. Fortunately, traffic has declined just 18.3%, and the average domestic one

- way fare is up just 8.1% over the same period to $192 in 2013. Although the average domestic fare is up just 8.1% over the last ten years, it is up 23.7% since a ten year low in 2011.

Exhibit 1. Eau Claire Seats per Day Each Way, Domestic Passengers Per Day Ea ch Way (PDEW) and Average Domestic One

- Way Fare

– Annual Data

– 2004

- 2013 (U.S. DOT DB1B Data)

.

Eau Claire’s d o mes tic t raffic decline d significantly three times between 2005 and 2009. Between 2005 and 2006, traffic declined 16.7% to 53 P DEW, between 2007 and 2008, traffic declined 21.1% to 41 PDEW and finally declined 30.0% between 2008 and 2009 to just 29 PDEW. The decline between 2007 and 2008 occurred as Eau Claire’s average domestic fare increased to an all

- time high of $223, and the final decline occurred as capacity fell 13.1% to 172 seats per day each way and the average domestic fare remained above $200. The final decline also coincided with Mesaba’s Notice of Termination indicating it would discontinue service to Eau Claire unles s it received a subsidy under the Essential Air Service Program. Although c apacity continued to decline as Eau Claire transitioned from Mesaba’s service to SkyWest’s twice

- dailyChippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 7 service to Chicago and has settled at 100 seats per day each wa y, domestic traffic has increased 81.4% from the low of 29 PDEW in 2009 to 52 PDEW in 2013.

Although Eau Claire’s average domestic fare declined from a high of $223 in 2008 to a ten

- year low of $155 in 2011, it has increased 23.7 % since 2011 to $ 192 in 2013 and now e xceeds the average domestic fare of $181 at the average Lower 48 airport.

Compared to the average domestic fare at the average Lower 48 airport, Eau Claire’s average fare has increased at a faster rate

– 23.7 %

-- from $155 in 2011 to $192 in 2013 as ill u strated in Exhibit 2

. Over the same period, the average domestic fare at the average Lower 48 airport increased just 5.6% from $171 in 2011 to $181 in 2013

.

Exhibit 2

. Eau Claire Average Domestic One

- Way Versus Average Domestic Fare at the Average Lower 48 Airport

– Annual Data

– 2004

- 2013 (U.S. DOT DB1B Data)

.

Exhibit 3 illustrates the relationship between Eau Claire’s capacity, domestic traffic and average domestic fare over the last nine quarters through fourth quarter 2013. Although capacity has been flat over the last nine quarters, the average fare exceeded was $220 in first quarter 2013 and $ 209 in fourth quarter 2013. This compares to an average fare of $180 in first quarter 2013 a t the average Lower 48 airport and $180 in fourth quarter 2013 as illustrated in Exhibit 4.Chippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 8 Exhibit 3

. Eau Claire Seats per Day Each Way, Domestic Passengers Per Day Each Way (PDEW) and Average Domestic One

- Way Fare

– Quarterly Da ta

– Fourth Quarter 2011 through Fourth Quarter 2013 (U .S. DOT DB1B Data).

Exhibit 4

. Eau Claire Average Domestic One

- Way Versus Average Domestic Fare at the Average Lower 48 Airport

– Quarterly Data

– Fourth Quarter 2011 through Fourth Quarter 2013 (U.S. DOT DB1B Data)

.Chippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 9 TRAFFIC RETENTION AN D LEAKAGE

Based on a traffic retention and leakage study completed in 2012 using year

- end first quarter 2012 data
, Chippewa Valley Regional Airport retains just 12.1% of all traffic generated in its catchment area; 79.7%, or 380 passengers per day each way leak to and from Minneapolis/St. Paul International Airport ; 7.0% of the traffic leaks to Madison and 1.2% o f the traffic leaks to Wausau/Stevens Point.

Exhibit 5. Traffic retention at Chippewa Valley Regional Airport and leakage to Minneapolis/St. Paul, Wausau/Stevens Point and Madison ( Sixel Consulting Year

- End First Quarter 2012 Traffic Retention and Leakage Study Data)

.

Although a significant amount of traffic likely leaks from Eau Claire to an alternate airport because nonstop service exists from the alternate airport to a traveler’s final destination, because more flight s are available or because lower fares may be available from an alternate airport, some traffic may leak simply because travelers are not aware of the United Airlines coded service available from Chippewa Valley Regional Airport. An effective marketing program may enable the Airport to retain more traffic if awareness of the existing service increases. 

### 7.0% 1.2% 79.7% 12.1%Chippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 10 AIR SERVICE DEVELOPM ENT EFFORTS AND AIR SERVICE MARKETING

The Chippewa Valley Regional Airport has been in the EAS program for a number of years with the first carrier being Northwest Airlines via Mesaba Airlines with service to Minneapolis/St. Paul

. The 2009 EAS bid cycle found the community presented with a new o ption: twice daily service to Chicago O’Hare on a 50

- seat regional jet operated by SkyWest Airlines under the United Airlines brand

. Therefore, while additional options would have always been appreciated, true air service development recruitment efforts we re not necessary

. However, airport management and their consultant did have ongoing phone conversations with not only Mesaba Airlines and Northwest Airlines when they were in the market, but now SkyWest Airlines
, especially as each two year EAS bid cycle comes to a close

.

Previous EAS bids from SkyWest Airlines did include marketing assistance funds in the submission; 2011 bid for example had $20,000 allocated for marketing assistance

. The current contract does not provide for any marketing assistance

. One can assume the lack of airline marketing funds implies the airline feels confident that the area knows of the service ; however the average load factor suggest s this assumption to be inaccurate

.

The Chippewa Valley Regional Airport maintains an outstanding relationship with Sixel Consulting Group as their partner in air service development efforts

. CVRA has retain ed Sixel Consulting Group for several years now and works with them to ensure the Chicago O’Hare route continues to be viable as well as communicate with any other charter or potential low cost carrier option

. Sixel Consulting Group did assist the Airport in December of 2009 with the transition between essential air carriers, Northwest Airlines to SkyWest

. This included document prepar ation for community distribution as well as connection data to ensure the community understood the value of the ORD hub

. More recently, Sixel Consulting Group participate d in the Master Plan Update, completed in 2012, for the airport providing not only a “leakage study” but also an estimate on future air carrier operations and equipment type at the Airport

.

Current Air Service Marketing

– The Chippewa Valley Regional Airport maintains an ongoing air service marketing effort, but the budget allocation is tight and the staff resources to accomplish some of the necessary community outreach efforts are not available

. In the days of trying to do more with less, the marketing program’s reac h has been diminished

. Below is a list of the variety of media channels the Airport has been active in:Chippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 11 The a dvertising focused solely on the daily flights offered by SkyWest from the Chippewa Valley Regio nal Airport as depicted in the bus ad example included in this document

. With Northwest Air link leaving the market to newcomer SkyWest Airlines, the Airport felt compelled to advertise in as many venues as possible in an effort to educate the community on the new carrier and service

. However, an actual marketing plan with quantifiable metrics to track the effectiveness of the ads was never developed

. Ads were placed in various forms of media without a full plan in place

.

While the Chippewa Valley Regional Airport recognizes incorporating marketing activities into the op erating budget is crucial to continued success of the service and airport passenger boardings, limited funds in past years have prevented Airport staff from developing and executing a full scale marketing plan

. As with other similar sized airports, s taff members often wear multiple hats to ensure the smooth operation of the Airport leaving little time to devote to marketing and advertising activities

. With that being said, the Chippewa Valley Regional Airport made certain to allocate some funds to adverti sing activities throughout the past 5 years

. 2010 through 2013 the marketing budget for the entire Airport was $25,000 per year with 2014 seeing a slight increase in budgeted amounts at $35,000

. Annualized spending has been kept at a fairly consistent rate

.

In summary, both the Chippewa Valley Regional Airport and the community it serves realize the importance of their local air service

. In the EAS program “air service recruitment” is a once

Marketing and Promotional Activity Summary For Past 5 Years TV Advertising Radio Advertising Online Advertising through limited Websites

City Bus Advertising Traditional Print

- Local Market Trade Show ExhibitsChippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 12 every other year exercise and with a United Airlines coded regional jet to a major hub in the market, there are not a lot of options for “recruitment”

. CVRA has worked hard, within the ir budgetary constraints, to promote the service that exists

. But given the location of the airport and the amount of passenger traffic that is leaking to nearby airports, this has been a significant challenge

. This challenge can be overcome with an airport specific , detailed marketing plan coupled with a strong community engagement tie in

.



## STRATEGIC PLAN TO IM PROVE AIR SERVICE THROUGH MARKETING

The Chippewa Valley Regional Airport has one significant positive item working in its favor: the airline service SkyWest is offering

. With direct, twice daily jet servic e to Chicago O’Hare, one of the largest domestic airline hubs
, the service is a package many communities would be envious of

. Service is provided on CRJ 200, 50

- seat aircraft, which is arguably the proper gauge of aircraft for the market and route of this distance

. SkyWest Airlines is a willing carrier; committed to be ing successful in all markets it serves

. This is evident by the letter of support provided with this application

. The more urgent task of the airport is to continue to develop traffic demand and route utilization from the airport
, and stop leakage to oth er nearby airports

.

Funding Plan

– This grant application proposes to use modest SCASD funding, coupled with non

airport cash matching funds from Eau Claire County, to fund a broad and multi

- phased marketing and advertising program in and around the region

. The proposed program would be directly tied into the detailed marketing plan the Airport is proposing to develop

. This plan would include quantitative measurements which would measure the effectiveness of any campaign initiated for CVRA.

In

- Kind contributions are being sought from various local media outlets which may include trade advertising or added value to future placement. However, a specific dollar amount cannot be identified at this time without knowing if the grant application is success ful. Rest assured local media firms will be pressed for additional value in any placements in the market and CVRA will make the case assisting in this endeavor helps the regional economy flourish.

The Chippewa Valley Regional Airport has done a respecta ble job within their current, limited budget of marketing and promoting local air service

. The phenomenally high leakage rate to nearby airports paired with a national shift in travel planning demands a new and moreChippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 13 complex approach to local air service m arketing

. An aggressive and multi

- layered marketing, promotional and community outreach effort
, is proposed for the airport and can be accomplished with the help of this funding

.

The Airport would like to utilize g rant funds to develop and implement a full a ir s ervice m arketing

s trategy and a dvertising p lan to use as a guide for all future initiatives and ensure all airport marketing activities are in line with achievable goals and industry demands

. The plan will identify airport goals and tactics to achieve each of those defined goals

.

One of the key components of the proposed marketing strategy process will be to determine if brand development and creative exercises are necessary in order to find the correct channels to advertise on in order to e ncourage more local travelers to choose to start and end their trips from Eau Claire verses driving to a competing airport

.

The marketing s trategy will include a full advertising campaign and plan which will be focused on increasing awareness and driving travelers to choose to travel from EAU

. The plan would include a combination of traditional advertising methods and new media methods to adv ertise the current United Airlines service while using the brand identity of the airport to resonate with local travelers

.

The advertising plan will work to refine the Airport’s media strategy to reflect national consumer shift to online travel planning while simultaneously working to advance familiarity with EAU in the local community

. The proposed program will aim to support United Airlines with retail advertising through traditional methods while also focusing on defining and communicating the real customer value of flying from EAU to Chicago O’Hare (ORD) to connect onwards as compared to driving to alternative airports

. The airport will also look into incorporating a modest online travel planning calculator and using social media to create awarenes s and attract travelers in the region

.

The marketing s trate gy will also include a focused community outreach and corporate travel
p rogram

. By further developing partnerships with local economic development, government and tourism partners, the airports can maximize related partnership marketing efforts

. Partnerships will help the airport maintain a solid image and reputation as strategic air transportation leaders in the region

. Corporate outreach is also an important component andChippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 14 will be included in an effort to connect with local businesses and identify opportunities to retain more local business traffic

. Funding for the EAU marketing strategy and advertising pr ogram would be spread over a 12

- month period aimed at commencing during the second quar ter of 2015

. To better understand the true Chippewa Valley Regional Airport market, the Airport would like to move forward with an updated True Market Analysis

. Information from the last True Market Study is nearly four years old and travel patterns may have significantly changed during that timeframe

. Once results of the True Market Study are known, the Airport can begin developing specific goals and tactics to reach potential passengers

. Under this proposed timeline, the detailed marketing plan should be established by the end of second quarter 2015 and media placement is targeted to begin following the completion of that plan

. The media placement will include launching updated Airport branded ads in the market

.


### Components of the Proposed Chippewa Va lley Regional Airport (EAU) Marketing Strate gy Plan and Advertising Program

True Market Research: In an effort to understand the true markets served by EAU, a “true market” study (sometimes referred to as a leakage study) would be conducted utilizing a portion of the proposed g rant funds

. The results of this study will help the airport to showcase i tself to airlines and also assist in the marketing efforts by allowing EAU and associated marketing consultants a “true market” vision for the airport

. True Market Studies are a great way to illustrate demand that doesn’t show up in traditional data sour ces

. Airlines can see the demand that is not being
met

.

Benefits of a True Market Study:
 Air Service Marketing Benefit: Helps to determine “true” number of local PDEW that might fly a particular m arket if additional service was added

.  Passenger M arketing Opportunities: Allows a deeper look at where passengers are coming from, leaking to and will help to determine which geographical areas warrant focused advertising efforts and increased paid media spend

.

Traditional Advertisi ng and Marketing Me thods: The strategic marketing and advertising plan will utilize a combination of traditional advertising and public relations methods paired with targeting online and new media methods

. The goal of the program will be to connect and re

connect with potential travelers while also increasing brand awareness within the region

.Chippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 15 Components of the traditional advertising portion of the plan will include: Radio Advertising, TV Advertising, Out

- of

- Home (billboard advertising), and Local Online Advertising (local online news banner advertising)

. O n

- air/TV spend may be focused on premium placement such as weather and traffic sponsorships to ensure maximum value and the largest audience reach ava ilable. The airport will also work to develop brand specific television commercials which will be incorporated into the on

- air placements and also used in on

- line pre

- roll elements of the media plan

. The inclusion of traditional media placement will allow the airport to support local media outlets while enhancing relationships with local media partners

. The described traditional advertising elements will be timed around specific program objectives including the incorporation of airline fare sales and spec ific efforts around Airport brand building and local

awareness

. Recommended media outlets will be determined once the advertising program is finalized

.

New Media and Targeting Online Advertising Methods: The p lan will also include targeting online and new media advertising methods

. These efforts will incorporate a combination of: Advanced Keyword Targeting, Flight Path Advertising (targeted advertising on Online Travel Agencies), Search Engine Marketing and Social Media

. These advertising methods will b e aimed at targeting the potential passenger when they are in the mindset to travel

. Targeting online advertising will help the airport to reach travelers by incorporating airport / travel related keywords paired with geographical and behavioral targeting

. When a geo

- targeted traveler searches for specific airport defined words they will be redirected to an airport related ad while surfing on common news sites

. Recommended media outlets will be determined once the advertising program is finalized

.

Soci al Media Integration and Website Enhancements: By building an online brand presence through social media and website enhancements the airport can forge a stronger connection with the traveling public

. Ongoing, open communication on these channels can help to foster a trust within the online travel community

. By creating channels for one

- on

- one communication with airport travelers we can work to humanize the airport travel experience and create customers for life, rather than advertising acquaintances

. Th is social media program will allow the airport to have a conversation with past, present and future travelers, rather than simply allowing travelers to have a conversation about the airport, with no airport involvement

. The proposed marketing s trategy pro gram will work to develop a presence on social media sites (Twitter, Facebook, etc.)

. The program will also look into website enhancements that will help toChippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 16 highlight the Airport brand platform and help drive travelers to book flights from Eau Claire tho ugh education and offerings

.

A Travel Cost Calculator will also be incorporated into the enhancement program and will be aimed at educating local travelers of the true cost involved with traveling from EAU verses the cost of driving and parking at a c ompeting airport. A sample of what it might look like is below.

Community Outreach and Corporate Support Program: An important component of the marketing p lan will be a community outreach and corporate support program

. The Airport would like to move forw ard on developing a full plan to identify major corporate travel patterns

. There are a number of corporations locat ed in the region including the corporate h eadquarters for Menards

. The program will work on developing a corporate travel program and reaching out to travel planners of corporations to get more employees to fly from EAU

. The proposed program will attempt to identify the needs of corporate travelers and allow the airport in conjunction with airline partners, increase offerings to better accommodate high paying business customers

. The program will start with the identification of Travel Managers/Travel Contacts within top 50 corporations in the region

. The next step in the program will be to use relationship building tactics and ident ify ways to encourage travel managers to modify travel policies so that all travelers check EAU first before booking from another airport

.

The proposed marketing program will also identify community partnerships and advertising opportunities including l ocal coll eges, sports leagues and events

. The sample marketing plan is briefly listed in the following chart

.Chippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 17

Chippewa Valley Regional Airport Sample Marketing Plan Develop online travel planning site presence Promote Air Service to ORD based on updated passenger leakage analysis Focus on Overall Cost of Travel in Comparison to Driving to Alternative Airports Look at Developing Incentive Program for Corporations to Utilize CVRA

Tactics to Implement CVRA Plan Traditional Advertising to create a standardized brand position that fits in the market: radio, online, outdoor, TV Begin specific advanced online retargeting campaign Implement social media campaigns to target educational institutions and their audien ce

Corporate outreach through grant partners database information Direct corporate incentive program for Airport utilization

Sports/Community Sponsorships Total Marketing Budget Including Leakage A nalysis and Video Creative: $165 ,000

If awarded the modest grant amount requested, it would be the intent of the Airport to fully utilize the grant prior to the end of 2016 with grant close out documents submitted for approval late third quarter 2016; well before government deadline

. Activity/Project Milestone Estimated Date Grant Award Late September 2014 Documents Fully Executed Early November 2014 Passenger Leakage Analysis Updated 1 st Quarter 2015 Detailed Marketing Plan Development Late 1 st Qtr

. /Early 2 nd Qtr

. 2015 Execution of Marketing Plan 2 nd Quarter 2015 thru 2 nd Quarter 2016 Grant Close out Submitted to DOT 3 rd Quarter 2016

The goal of the Chippewa Valley Regional Airport program will be to increase current traffic levels by at least fifty percent (50%) from 2013 levels

. The detailed marketing plan would include future media campaign considerations to provide a continued pathway for passenger growth once the modest grant amount was expended

.

The drive radius of the CVRA catchment area does cover a wid e area of Western Central Wisconsin

. These residents in the catchment area are within a two hour drive of direct, Chicago O’Hare service at CVRA while still remaining in the State of WI

. Crossing the border into Minnesota for service out of another major hub, MSP provides an economic benefit to that State; not to Wisconsin as a whole

. The purpose of this Grant application is to make that economic value KNOWN, whereas today it is essentially not known statewide or, for that matter, anywhere.Chippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 18 PUBLIC/PRIVATE PARTN ERSHIPS

Having a viable airport which provides access to the world is an economic engine in and of itself, but the Chippewa Valley Regional Airport has numerous entities supportive of the Airport’s goal of improving air service awarene ss

. The Chippewa County Economic Development Corporation, the only full time professional organization aimed at the economic development of Chippewa County , is a strong supporter of the application

. Attached to the application is a letter of support expla ining how increased air service promotion will benefit the area from their view point

.

The other large professional economic development agency, Eau Claire Area Economic Development Corporation, may provide the Airport with access to their customers th rough their email data base

. It would be the intent of CVRA to establish an arrangement to provide informational updates to the membership about the benefits of using CVRA thereby promoting the air service and brand

.

The Eau Claire Area Chamber of Commerce is another strong supporter in the public

- private partnership

. Without viable, strong air service and the awareness of the capability to utilize the local airport
, the economic impact, both direct and indirect is reduced . T he option may exist to partner with them to send out specific CVRA marketing messages geared towards the business community via targeted email blasts as part of the marketing campaign

. Those details as well as other options will be determined should the application be successful

.

Other supporters of the application include the Chippewa Falls Area Chamber of Commerce, in addition t o a number of private entities including Xcel Energy , Sacred Heart Hospital and the University of Wisconsin

- Eau Claire. As proof of their support for the Airport, a portion of Eau Claire County’s financial contribution to the airport is committed to the ten percent local grant match. The incumbent airline also supports the Airport’s effort to increase ridership on the route and as evidence, provided a lett er of support which is included in this document.Chippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 19 PREVIOUS SMALL COMMU NITY AIR SERVICE GRA NT

The Chippewa Valley Regional Airport was a previous grant award recipient in 2004, but there are distinct differences between the previous application and award compared to the one you have before you today

. A major difference being the status of the airport at the time of th e first grant: non

- EAS status

.

The Chippewa Valley applied for and received a SCASD Grant in September of 2004

. The Grant

was for $500,000 with a local match of $100,000

. The goals of the Grant included: securing additional service to Milwaukee, WI (MKE) on Skyway Airlines, improve connectivity to the national air transportation system for Eau Claire and the surrounding communi ties, provide intermodal access to area residents via Amtrak service available at Milwaukee, increase use of services at the Airport to recapture traffic and elevate the Chippewa Valley Regional Airport to a secondary airport for the congested Minneapolis/ St

. Paul Airport

. Again, this was filed in the
pre

- EAS era of the Airport

. After the grant was awarded and negotiation with Midwest Airlines underway, it became clear that a relationship was not possible

. Thus, another airline and route was sought

.

Chippewa Valley Regional Airport ended up providing the minimum revenue guarantee to Big Sky Airlines for flying daily service on a Beech 1900 turboprop from EAU into MDW which quickly expended the grant funding while not fully meeting the community’s need s

. The service lasted approximately three months before it was pulled

. The Grant was closed in October 2007

.

This new 2014 Grant request is for marketing funding to promote the airport and the air service it contains within the scope of allowable Grant fund usage for EAS cities as described above

. It does not provide minimum revenue guarantees nor is the intent to connect area residents with other forms of transportation (i.e

. rail)

. As previously mentioned, the grant would be utilized for promotion a nd s trategic planning as it relates to advertising.Chippewa Valle y Regional Airport; Eau Claire, Wisconsin

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## 20 CONCLUSION

With Chippewa Valley Regional Airport only capturing 12 .1 % of the traffic in its catchment area, the need for additional marketing and promotional activities is clearly evident

. The twic e daily jet service to Chicago O’Hare, arguably one of the largest hubs domestically with connections throughout the world, is one that any small community throughout the nation would be envious of

. However, lack of a clear strategic advertising plan has left CVRA with no voice in the area; the service is underutilized with the average load factor since the SkyWest service began at a
mere 5 1%. T here is si gnificant room for improvement and this grant application seeks to give voice to the Airport.

This grant would provide the Airport with the opportunity to not only perform an updated passenger analysis, but would allow the development of a strategic, multi

- layered plan to actively engage the corporate community to better utilize the airport. The fundin g level requested is a modest $150,000 in federal grant funding backed by a local non

- airport match of $15,000, or 10% of the requested amount

. This Grant application outlines a creative solution to an entirely fixable problem ; EAS service with poor passe nger counts

. This modest funding will enable the Chippewa Valley Regional Airport to dramatically increase traffic, therefore reducing subsidy per passenger and, in future bid cycles, overall subsidy need

. It would be the eventual goal of the Airport to exit the EAS program in the future

. The Chippewa Valley Regional Airport together with their public and private partners urges the Department of Transportation to give this creative and modestly priced Grant proposal a favorable review

.

### July 21 , 2014

Ms. Brooke Chapman, Associate Director Small Community Air Service Development Program U.S. Department of Transportation 8 th 

### Floor, Room W86

- 307 1200 New Jersey Avenue SE, Washington D.C. 20590 Dear Ms. Chapman,

Referenc e: Docket DOT

- OST

- 2014

- 0 1 13 The Chippewa Valley Regional Airport located in Eau Claire Wisconsin, has submitted to the Department an application under the 2014 Small Community Air Service Development (SCASD) Grant. The Airport’s application is for market ing funds to support new or existing air service at the Chippewa Valley Regional Airport. These funds, if awarded, will go towards the development and implementation of a marketing campaign to increase awareness and promote the services the airport provide s. The campaign would include a variety of elements including, but not limited to an updated true market study and a community engagement program. Xcel Energy, the electric and natural gas utility provider throughout the Chippewa Valley, fully supports t he application as the ultimate goal of the marketing campaign is to increase passenger service to a level where the Airport may be able to exit the Essential Air Service program. We therefore urge the Department to give the Chippewa Valley Regional Airport 2014 grant application favorable consideration as the process moves forward in grant award.

Best regards,

James M. Hanke Manager

– Economic Development & Community Services Xcel Energy770 Scheidler Road, Suite 3  Chippewa Falls, WI 54729 (715) 723
- 7150  (800) 797
- 9976  Fax: (715) 723
- 7140

e - mail: ccedc@chippewa

- wi.com 

### Ju ly 16 , 2014

Ms. Brooke Chapman, Associate Director Small Community Air Service Development Program U.S. Department of Transportation 8 th Floor, Room W86

- 3 07 1200 New Jersey Avenue SE, Washington D.C. 20590

Reference: Docket DOT

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Dear Ms. Chapman
, The primary mission of the Chippewa County Economic Development Corporation (CCEDC) is to foster a strong economic environment which supports businesses and nurtures growth and new investment in the region. CCEDC is dedicated to promoting and facilitating economic development and to improve the quality of lif e in Chippewa County by increasing its economic base. The Chippewa Valley R e gional Airport (CVRA) is critical to our economi c development success and its important role cannot be over emphasized

. The purpose of this letter is to urge the US Department of Transportation to award the CVRA the 201 4 Small Community Air Se rvice Development (SCASD) Grant currently submitted. This funding requ est is for marketing funds to support new or existing air service at the CVRA . These funds, if awarded, will go towards the development and implementation of a marketing campaign to increase awareness and promote the services the airport provides. The cam paign w ould include a variety of elements including, but not limited t o an updated true market study and a community engagement program.

The CCEDC Board of Directors fully supports the application as the ultimate goal of the marketing campaign is to increase passenger serv ice to a level where CVRA will be in a better position so as not to utilize the Essential Air Service program in the future. If I can answer any of your questions concerning CCEDC ’s support for the activities outlined in the CVRA 2014 SCASD applica tion please do not hesitate to contact me. Best regards,

Charlie Walker Chippewa County Economic Development Corporation