Business Strategists, Motorsport Marketers and Business Development Managers based in UK, Turkey, India and USA discuss the latest developments in motorsport marketing and sponsorships.
Tom Halls (UK) – eSports Strategist, Chief Digital Officer, NRG. Tom has 10 years of experience as a digital native working with some of the world’s biggest brands including FormulaE. Currently the Chief Digital Officer for NRG eSports and participates in gaming competitions globally
Deepali Ramaiah (IND) – Marketing strategist with an MBA in Global Marketing & experience in engineering services. She is an occasional F1 writer for f1pulse.com, The Youth Express with keen interest in motorsport sponsorship & assists Fox Sports Asia with F1 Grand Prix analysis.
Metin Mete (TUR) – Commentator of Formula 1 between 2010 and 2012 live on Turkish TV. Founder of #F1Discuss online talk show program with hosts including Craig Scarborough and Adam Parr. Now author of Motorsport.com Turkey edition.
Danielle Crespo (USA) – Danielle has worked in nearly every form of motorsport, primarily focusing on hospitality brokerage and business-to-business partnerships. She’s been involved with premier global race series, including Formula 1, WEC, Formula E, IMSA, and now NASCAR. Danielle splits her time between the San Francisco Bay Area and Austin, Texas.
Q1: On Formula 1 new ownership, how soon do we expect to see changes in how it is managed?
DR: Hopefully this means more heritage tracks, teams and long term payments. Given Ross Brawn is leading that charge, and he is a fan of putting long term plans in place, we could see an even further delay in changes coming into effect (perhaps 2019?). On the commercial side, the delay also fits with its desire to move into markets that F1 needs to be in, and move away from countries that perhaps F1 no longer needs to be in / shouldn’t have been in in the first place.
With Liberty Media having better understanding of the media broadcast and distribution landscape, perhaps deals with broadcast rights holders may be renegotiated to make better use of digital assets (already seeing a loosening up of the type of content teams & drivers are now being allowed to post from F1 sessions). Expect to see a WEC/MotoGP style of live races subscription service.
MM: On the commercial side, we might see the impact of this change from this season. Liberty Media is more “modern” in their approach to F1 so I expect something sooner than 2019. Personally, I think this means we would see fewer races n Asia but more European and America races. Also, Ross Brawn’s decisions and choices will be more in line with FIA and Jean Todt.
DC: Question is – have they brought in new people since it was a fairly late takeover so I adopt a wait-and-see approach, use each F1 event as a case study i.e. availability of media, social media, on-demand etc and how quickly they catch up with other sports which are “more open”.
Q2: FIA.com website includes plans for a gaming championship with Polyphony to start in 2017. FormulaE had a sim race in Vegas with $1m prize pot in January 2017- does eSports have a place in/alongside Formula1 & how could it be monetised?
TH: The interesting part of the Polyphony-FIA deal is that it is the only FIA licensed competitive eSport. The FormulaE event in Las Vegas wasn’t FIA sanctioned and it wasn’t on the FIA Calendar but what we tried to do in Vegas was try to understand how the public would react to sim racing. The Visa Las Vegas event was geared much more towards sim racing fraternity which is more targeted and closer to real racing than other platforms. Although most people may not appreciate this, but the event which was livestreamed on Twitch, had 13,000 concurrent live viewers. This was record viewership on Twitch, obviously boosted by the $1m prize money.
New management structure at Formula 1 want to bring younger fans in and everyone is looking at eSports and competitive gaming. Accessibility is the key and the goal is not necessarily to get more people into racing. It is essentially marketing tool – it gets 5-6 times more reach than traditional marketing tools.
It certainly was an easy sell to VISA (one of Formula E’s sponsors and main sponsor of Las Vegas eRace). They had a large proportion of the virtual track signage in the game. However costing this as tricky as there was little or no prior art to valuing virtual track signage. It is obviously much easier to track than live races on TV since camera angles can be adjusted to maximise sponsor’s brand visibility, hence maximising their Return on Investment (ROI).
Q3: On a related note, are there credible plans to incorporate Virtual Reality (VR) into racing events, and what are perceived benefits for fans and sponsors?
DR: Mercedes did their car launch in 360 degree view. It’s not a stretch for fans to use even Google Cardboard and VR supported phone to do a virtual walk around of the car. This can be extended to whole season – perhaps fans want to see the Belgian GP from the top of Eau Rouge in Spa – maybe not the whole race but snippets of content from a particular corner at each race track. On the commercial side, this would also be applied to Business-to-Business/Consumer (B2B/B2C) deals and for brand exposure and activation. Investing in VR could also help smaller brands that can’t spend money for on-ground activations in countries F1 visits, but create the same experience sitting at home or a sports bar. For example, alcohol advertising is barred in certain countries but beverage sponsors involved in sports could use VR for activations.
TH: On the topic of virtual racing’s role in marketing, particularly with sponsor activations (B2B and/or B2C), this is a great way to engage a different (often younger) demographic of fans. Primarily it serves as a portal into the world of FormulaE etc, allowing fans to get a greater understanding of the Championship and the USPs (FanBoost, two cars etc). We found that activating effectively with sponsors was reliant on creating an authentic product that remained true to the gamer’s mindset; if you try to force an activation upon them they reject it quickly. To this end for instance, VISA’s involvement was kept relatively subtle, but were seen to be supporting the series and providing a content outlet.
DR: So can virtual racing games, collaborating with the FIA, get the gaming fanbase (not already watching Formula 1 or Formula E) interested enough to watch the sport, since they are the ideal target market of fans / viewers?
TH: If virtual racing games and competitive structure which is engaging enough to tell the story of the series, then certainly they could get gaming fan base to watch F1 or FormulaE. We already had a great story to tell with “FanBoost”- which essentially gamifies a real-life series, so the transition was fairly painless. The younger drivers, exciting cities and great soundtrack all help appeal. With other series like WRX and F1, I think more work is required – especially with F1 where the series has been around so long that creating new fans outside the normal sphere of acquisition, is tricky.
MM: With the new car-mounted cameras and helmet cams, VR is definitely another opportunity to engage more fans. But it has to be reasonable and affordable for fans.
Q4: Lewis Hamilton in a recent interview with UBS said he would like more races in USA and more city tracks like in New York or London, to bring fans closer to the action. Is “city racing” model viable for F1 in the long run?
MM: City Tracks which typically have less run off areas deliver more excitement i.e. we’ll see driving which is “less Maldonado, more Alonso”. Also, city tracks attract more fans. Baku (Azerbaijan GP) would not work if it were elsewhere in the country. Singapore and Monaco are good examples of how good the city racing model works.
DR: David Coulthard did a promotional event for Red Bull in Mumbai a few years ago and a bridge was shut down for this demo run. Lewis Hamilton did the same in Bangalore and crowds were huge. Delhi could work (as a city track) due to its structure and because of regular VIP and diplomats visits, the locals are used to road closures. We want more races in iconic cities with iconic skylines but this has to be balanced with shutting down roads and disrupting regular life. Heard from sources that the local government in Hong Kong did not support the Formula E wholeheartedly – they did not go all out to promote the race like the Singapore government does with the F1 race i.e. treat it an extension of the Singapore ‘brand’. It seemed the Hong Kong race organisers did not really care about engaging fans or sponsors or any partners once the race was confirmed.
MM: If Liberty Media can gain more money from other sources, e.g. eSports, VR using the fan base etc, they should be able to have more European Races on the calendar [which typically do not receive Government support]. Also note that given recent global events, countries whose economies depend heavily on oil, e.g. Malaysia, Russia, and Azerbaijan might not be able to hold onto hosting F1 races.
DR: If Liberty Media is keen to bring back to USA, perhaps they could revive old tracks like Watkins Glen, Long Beach and rotate European races e.g. Belgian vs French GP. Given the option of going to a race at say Melbourne or Montreal versus the likes of Catalunya or Hungaroring, there is so much more a fan could do at one of the former e.g. visit the sites, take in the local cuisine – instead of spending time to-ing and fro-ing from the circuit.
From a sponsor perspective, in-city events afford brands & organizations the opportunity to execute activations with a better infrastructure – be it schmoozing B2B clients or engaging with end consumers. From a non-motorsport media standpoint, it becomes easier for regular press to cover the event and spread word of F1 to the masses, who might tune in on race day.