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Introduction

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“Even an event at the top of its game must struggle to get funded,” said Jonathan Witz, president of Pontiac-based Jonathan Witz & Associates Inc. and producer of the Chrysler Arts, Beats & Eats Festival. “When the economy gets a little soft, event marketing is often the first thing to go.”
Detroit’s array of outdoor festivals provides opportunities for dozens of local bands to showcase their music to large crowds that are often unaware of them.
The Rock City Festival on June 19-20, for example, will feature about 30 mostly local bands. And Rock City, in its inaugural year, is one of the smaller local festivals.
Karen Mulvahill, chief marketing officer for Comerica Bank, said the main goal of Comerica’s TasteFest in July is to spotlight local restaurants and bands.
“I think that a lot of the acts are maybe not very well known when they come and play at Comerica’s TasteFest, but a lot of them get exposure to this huge live audience,” Mulvahill said.
Detroit’s festivals also provide an economic impact beyond their own budgets, said David Littmann, Comerica Bank’s senior vice president and chief economist.

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Littmann estimates that the direct economic benefits from parking fees, gas, additional food, hotel rooms and related spending is more than $103 million.
Still, the managers of every festival contacted by Crain’s said they struggle each year to raise enough money to cover their costs.
Next weekend’s annual Farmer Jack PraiseFest was renamed the Motor City PraiseFest this year because Farmer Jack cut back its sponsorship level.
In early May, Michael Watts, president of Plymouth-based Watts Up Inc., was worried the festival would have to be canceled.
“We need help,” said Watts, who produces the annual Downtown Hoedown in May and the PraiseFest in June. “Everybody is out fighting for dollars.”
But several last-minute sponsorships, including one from the Greater Detroit Chevrolet Dealers, made it possible to stage a two-day festival rather than the traditional three-day festival, Watts said.
Organizers of Movement 2004, Detroit’s annual electronic music event, were still working in April to sign their first sponsor. In fact, Movement 2004 didn’t announce any sponsors or scheduled artists until just 18 days before the Memorial Day weekend event.
This year Movement 2004 was produced by Movement 2004 L.L.C., a joint venture formed in April between Derrick May’s Transmat Events and Kevin Saunderson. Both are electronic music pioneers.
Kent Spencer, a partner with May in Transmat Records, said there were delays in the production of this year’s event caused by a business structure that complicated decision-making, which in turn caused difficulties between May and a business partner.
“Those issues have been, I’d say, 95 percent resolved,” Spencer said. “There were some things that just stemmed from the urgency of what had to be put together last year.”
In 2003, Transmat Records was given the contract to produce Movement 2003 less than six months before the event took place. Organizers scrambled to meet deadlines and didn’t have enough sponsors to cover costs.
This year, landing a Panasonic sponsorship was an important step toward making Movement 2004 possible, said festival manager Derrick Ortencio.
Panasonic used the festival to market a new car-audio system to festival patrons, Ortencio said.
“The festival was an opportunity for Panasonic ELS to demonstrate that technology to an entirely different audience and an entirely different decision-maker and an entirely different trend-setter,” Ortencio said.
Plus, this is the last year that the Ford Detroit International Jazz Festival – now in its 25th year – will be a jazz-only event and the last year that it will be held in Hart Plaza, said Sandy Duncan, president of Music Hall Center for the Performing Arts, which produces the festival.
Over the past four years, declining attendance and fewer sponsors resulted in annual losses as high as $300,000 a year. They have accumulated to a deficit of about $1 million, Duncan said. Last year attendance stabilized, and this year Duncan expects the event will break even, with a projected $900,000 budget.
Still, starting in 2005, the jazz festival will move out of Hart Plaza. Plans call for the festival to begin on Woodward Avenue where it crosses I-75 and for it to go south to Campus Martius. It is to expand to six outdoor stages and include bands from multiple genres.
The jazz festival has been challenged recently by another Labor Day event, Arts, Beats & Eats in Pontiac, which has become larger.
Duncan said competition for sponsors isn’t a major problem, because Ford is the title sponsor of the jazz festival and Chrysler of Arts, Beats & Eats. Detroit’s sluggish economy, Duncan said, has been the biggest fund-raising barrier.
However, Duncan acknowledged that the two events do compete for patrons. And next year, as the Detroit festival branches out into rock, R&B and other music, the festivals will compete for the best local bands.
The slow economic recovery of Detroit also has caused Arts, Beats & Eats to struggle to maintain funding.
“From an image perspective, Chrysler Arts, Beats & Eats is at the top of its game, but that does not translate automatically to sponsorship support,” Witz said.
In 2003, Witz said, the festival secured more than $700,000 in sponsorships and pulled more than $200,000 from percentage sales arrangements with concession vendors.
This year, he said, his goal is to raise the same amount of sponsorship dollars as he did last year.
The best way to reel in sponsors is to offer creative ways for the company to get involved so that its name is marketed in a memorable way, Witz said.
“These companies don’t want to just put their signs up,” Witz said.
But both Comerica Bank’s Mulvahill and Fred Hoffman, director of state relations for DaimlerChrysler AG, say their sponsorship decisions are aimed a business issue that is much broader than basic advertising and marketing.
“We are a world-class company, and we attract, hopefully, folks who are world-class employees,” Hoffman said. “And in order to do that, you really need to have a world-class environment not only to work in, but also to live in.”
Chrysler and Comerica are both major sponsors of the Concert of Colors, a three-day festival in July in Chene Park in Detroit that features music from around the world.

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Conclusion

Hoffman said he embraces the controversial economic theory promoted by economist Richard Florida, author of The Rise of the Creative Class: And How It’s Transforming Work, Leisure, and Everyday Life.
“We were thinking this way well before Florida put this on the radar screen,” Hoffman said.
Florida, who was in Detroit in March for a daylong workshop, argues that in today’s economy, young, talented and educated employees choose to live in cities that offer vibrant cultural and entertainment options.
Cities that lack those amenities, Florida says, will struggle economically. Florida’s theories have been attacked as an oversimplification of the forces that shape employment and economic development.
“I think that attracting and retaining young people is really important to the community,” Mulvahill said. “I believe that festivals like this that have acts that attract young people are an important part of creating a quality of life that will encourage young people to stay.”
For Watts, the final assessment of Detroit’s festival scene cuts both ways: While all of Detroit’s festivals are struggling to maintain sponsorship levels from previous years, he also argues that Detroiters often don’t recognize the quality car speakers and diversity of the events produced every year.

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