Last year, we asked the question ‘F1 2017: Where have all the sponsors gone?’. It was suggested that due to the growing difference between the F1 teams’ valuations of car positions and the actual true media value of these locations, many cars were looking bereft of sponsors. Fast-forward twelve months, and has the situation improved? Well…. not really. In fact, McLaren’s striking orange and blue livery has just brought more attention to the glaring gap on the side of the car! Perhaps though, it’s time to realise that the dependence on selling logo space on the car, on the driver overalls, or on the walls of the team garage is no longer what brands are sold on. It’s time for F1 teams to change their sponsorship strategy.
Nobody needs reminding of the constant warnings that are voiced about F1’s declining TV viewership figures; a quick glance at the UK overnight figures from last weekend’s Australian GP wouldn’t have eased concerns. In fact, these warning signs have been in place for several seasons now and appear to be a reflection of the wider population’s change in consumption habits. As highlighted by comments from Red Bull driver Max Verstappen in Australia, two-hour live races no longer fit well into the on-demand, ever-connected society that we live in. With fans in control of their viewing experiences, why do they need to spend two hours sat on their sofa watching a Grand Prix when they can just go online and find everything they need to know at the end of the race? Brands are aware of this shift in consumption method, and yet F1 teams are not adjusting their sponsorship strategy accordingly. Yes, TV audiences have declined, so the value of branding on the side of the car has weakened, but F1 hasn’t necessarily got any less popular – the audience has just become fragmented, and the sponsorship opportunities on offer must change accordingly to reflect this.
Step forward Manchester City Football Club, one of the biggest teams in the global sporting arena, currently dominating the English Premier league. With over 6 million Twitter followers, 32 million Facebook likes and 6.4 million Instagram followers, they have an enormous digital presence. With this huge presence comes huge sponsorship opportunities, which Manchester City has successfully managed to utilise. The club currently has no less than twelve partners sponsoring what they call their ‘fan stories’. These include the Manager’s Preview presented by Betsafe, Starting Line-Ups presented by Hays, and Photo Moment of the Match presented by Tecno. Each partner gets a logo placement either on a photo or visual, or at the beginning of a video, which is then shared to millions of eyes across the team’s social media platforms. A flick through the F1 social media accounts paints a very different picture.
It would be wrong to suggest that F1 teams’ digital presence hasn’t improved, because it very much has so, and with Liberty Media’s focus on improving the access made available to fans, this will only continue to get better. Nonetheless, with this greater freedom and improved access, the teams must take their current sponsors along with them and provide exciting opportunities for new brands to join. The sponsorship potential is huge, with numerous new categories becoming available; there is no reason that a team like Mercedes can’t replicate what Manchester City are currently doing. There is certainly space for a presenting partner for archive footage, post-race reactions, team manager previews, race statistics, behind the scenes content, car launches, photo moment of the week or overtake of the race to name but a few.
SQN Founder and CEO, Claire Ritchie-Tomkins, was the Sponsorship Manager for Nortel when they became a partner of the Williams team almost 20 years ago. The change in sponsorship landscape is very apparent to her. She says, “When Nortel was looking to become involved in Formula 1, brand exposure was an important part of the sponsorship strategy. During the late 1990’s there was no alternative to watching F1 on your TV; audiences were massive with millions of eyes watching every Grand Prix. With that amount of potential exposure, logo space on a car was prime retail. That’s why it was important, as part of any sponsorship deal, that Nortel was given branding on the car, which it managed with Williams on the front and rear wings.”
“Of course, we did a lot of work surrounding the activation opportunities around the sponsorship, but car logo visibility was quite central to the relationship,” continues Ritchie-Tomkins. “Today, the F1 sponsorship landscape has changed drastically. If I was a Sponsorship Manager at an established global brand, a logo on the car would not be central to my strategy. I would want to know where the greatest opportunities lie for us to tell our story in the best way possible. Digital plays a large part in this now, and it can’t be ignored or avoided. However, if brands go down this route then they must remember that any good sponsorship must not take away from the fans experience and passion for the team; it should support or enhance their experience. More opportunities are presenting themselves, but they must be used wisely and beneficially for the brand, the team and the fans,” concludes Ritchie-Tomkins.
If teams are to maintain or increase their current level of sponsorship income, then they must be creative with their offerings. It’s time to get with the times, put the brands first and provide them with the best platform by which they can tell their stories to the largest possible audience. Teams need to deliver opportunities that harbour the greatest potential for brands. A belief that the space on an F1 car is the prime asset in a sponsorship package is narrow-minded. Of course, it will always hold its own value, but the potential offerings surrounding any F1 team are vast, and at the moment haven’t been fully utilised. Many other global sports teams and championships are already reaping the benefits of this approach, now it’s time for F1 to catch up and match up!