At the June 28, 2023 Commission meeting, an item was referred to the Public Safety and Quality of Life Committee to discuss alcoholic beverage advertisements on city trolleys (referral attached).

Specifically, the item asked the administration to discuss past and present City contracts with vendors for marketing and advertisements on City trolleys including, but not limited to, the City’s ability to approve/disapprove any particular advertisement(s), the expiration date of any such current contract(s), any ongoing negotiation(s) for future contracts, and the financial impact of eliminating alcoholic beverage advertisements in future contracts and replacing them with advertisements for other goods, products and/or services.

All advertising accepted for placement by the City, or by a contractor authorized by the City to accept advertising on behalf of the City, must comply with Federal, State, Miami-Dade County, and existing City of Miami Beach laws, rules and regulations.

Consistent with the citywide administrative procedure issued in May 2014, a Contractor authorized by the City to accept advertising on behalf of the City, shall not accept for insertion any advertisement on or within city property that falls within one or more of the following categories:

• Unlawful or illegal goods, services or activities
• Tobacco or tobacco-related products
• Firearms
• Sexual services, programs or products
• Political candidates or political issues
• Competitive products for any City of Miami Beach citywide exclusive sponsorship agreement
• Advertising for alcoholic beverages within 250 feet of any school, day care or house of worship
• Any such additional category of advertising as the City may determine, as notified in writing to a contractor authorized by the City to place advertising on the public rights-of-way
•  

If alcohol or any additional categories were to be added to the list above, they would need to be approved via resolution by the Mayor and Commission.

In addition, the Administration is unable to choose which brands we allow within a specific category, meaning that the Administration is unable to allow advertising from one alcohol brand they consider "premium" and disallow advertising from another brand they consider “non-premium”.  Administrative approval policies must remain fair and consistent to all potential advertisers.

As of the printing of this agenda, the Administration has executed contracts with Outfront Media, who sells advertising space on the City trolleys and bus shelters (both digital and non digital), as well as Orange Barrel Media + IKE Smart City who was awarded the contract for digital kiosks.  Within the Orange Barrel Media contract, it is mandated that any alcohol advertising cannot promote over consumption or boisterous behaviors, and due to the advertising being 100% digital, all advertising content showcasing alcohol must be followed by a digital ad promoting safe and responsible consumption of alcohol. 

The Administration is currently in negotiations with Alchemy Media, who were awarded the right to sell advertising space within city owned parking garages. 

Contract Terms:

• Outfront Media – Contract began October 21, 2021 with an initial term of 20 years.
• Orange Barrel Media + IKE Smart City – Contract to begin July 2023 for a term of 10 years with an automatic 10-year renewal.
• Alchemy Media - currently being negotiated, with an initial term of 3 years.

Revenues:

Currently, alcohol as a City of Miami Beach advertising revenue category is the third highest grossing category, behind Entertainment (movies, streaming services) as #1 and Legal Services as #2.

As a revenue category, alcohol has grown +47.9% from 2022 to 2023:

Outfront Revenues - 2023

Alcohol Advertising

1. Anheuser Busch:
1. May 2023 - $55,000
2. Villa Maria Wines:
1. May 2023 - $10,000
3. Buzz Balls:
1. May 2023 - $3,929
2. June 2023 - $11,786
3. July 2023 - $6,286
   
   

Total 2023 Alcohol Advertising Revenues - $87,001

Total 2023 Advertising Revenues to Date $281,249 (all categories)

Alcohol represents 30.9% of current advertising revenues.

Outfront Revenues - 2022

Alcohol Advertising

1. Palm Bay International Moscato Wines
1. November 2022 - $23,942
2. December 2022 - $19,308

Total 2022 Alcohol Advertising Revenues - $43,250

Total 2022 Advertising Revenues - $179,166 (all categories)

*Advertising revenues from Orange Barrel Media and Alchemy have not yet been received as the contracts are either in the process of being signed or infrastructure being installed. The financial projections from both companies were submitted and accepted by the Administration with the expectation of being able to sell advertising space to alcohol brands.  Should the alcohol category be removed, revenue projections for both companies would need to be renegotiated.

Consistent with the figures above, it is estimated that removing alcohol as an approved advertising category would remove $125,000+ of revenues from the City, without contemplating the potential additional revenues from Orange Barrel Media and Alchemy Media.