can Liberty Media deliver a masterclass in brand partnership?
Last week’s news of the departure of Bernie Ecclestone from the front line of the Formula 1 Series he did so much to grow served to highlight many of the sport’s shortcomings when it comes to sponsorship. On the face of it, what’s not to like? Formula 1 still claims to deliver a global 400 million-strong TV audience. It has passionate fans across the world, following 20 weekend events spread over nine months and five continents. Outside of the FIFA World Cup and Olympic Games, there are few other sports with the broad global appeal and reach of Formula One.
However, when you look closer, there are clear cracks that highlight the job facing F1’s new owners, Liberty Media, following its $8 billion takeover of the sport.
Clearly exciting, competitive racing with boundary-pushing technology and big personalities at the wheel of each car would help the sport. However, finding the right balance between the haves and have nots in the paddock; speed versus safety on track; maximising performance against environmental concerns; technological advances weighed against budgetary realities; pay drivers v the very best talent; and exciting open racing or meddling with the format to make it more exciting is a complex topic. Luckily, Ross Brawn has been brought in to sort out much of that, so we’ll leave that side of F1 in his capable hands!
Of more interest to our professional involvement is how F1 can become more relevant for brands looking to benefit from an association with what remains an intriguing platform. Liberty Media has a huge opportunity to make F1 more relevant and, in their words, make each Grand Prix “the equivalent of the Super Bowl” in the host country, creating a bigger show, engaging new spectators and attracting new sponsors.
This will be exciting news for a number of brands who will be keeping an eye on what happens next. But despite this new dawn, the sport, and Liberty Media, still face many challenges in the sponsorship arena. Firstly, they need to strike the right balance between generating sponsorship income for the Series, and the teams’ requirement to find and service their own partners. Establishing what rights and activation possibilities are available for both is key.
Television audiences for live sport are starting to decline as our media habits change. Of most concern for Formula 1 is the perception that there is an apathy among a younger audience about cars and motor sport in general.
My own 14-year-old self would watch F1 every week and buy a glossy car magazine each month. I could name every F1 driver and most cars on the road. When pressed by an older boy to use my money for him to buy cigarettes, he generously conceded the choice of brand to me. “JPS Black” was the immediate response because of the Lotus F1 sponsorship. (It all ended well, by the way, when I thought I was about to die having smoked my first cigarette and have never smoked since!) When the time came for me to buy my first (and still only!) nice watch, I chose a Longines because of its long association with the Ferrari F1 team.
I suspect, on the other hand, that if Liberty Media had announced an F1 race taking place around our house this weekend, my 14-year-old son may watch for two minutes, share a few photos and videos with his mates on Snapchat, look up some great crash or F1 tech videos on YouTube and then settle back down to Spotify and his PS4, largely unimpressed!
The new Liberty F1 era needs to embrace digital and social channels and bite-size content to engage a new audience. But herein lies an issue. Much of the value for brand partners in F1 is derived from the possibility it gives to generate fascinating, engaging, live content that brings the raison d’être of a partnership to life. However, under the previous regime, access to this content was severely restricted during race weekends in order to protect the value of the TV rights that account for 35% of F1’s revenues. Neither team, drivers nor sponsors can post any video content from a race weekend without having negotiated a hefty fee for the right to do so.
Clearly, this is one thing that needs to change if F1 is to offer value to sponsors. I also see a need for more openness and fan engagement within the sport. Exclusivity has served the sport well, but if the F1 ‘club’ continues to be so exclusive, there’s a danger that the atmosphere inside the club dies.
Linked to this, there is also a shift from F1’s traditional ‘sponsorship’ model, where brands were simply paying for a sticker on the side of the car and some image and hospitality rights, and limited access to ‘the club’. We are now seeing the development of true brand partnerships in F1, as well as other sports, looking to develop two-way, meaningful and mutually-beneficial relationships.
Chris Murray, Head of Marketing at Williams Formula 1, will be sharing how stickers on cars is just a small part of what the team, and the entire Williams Group, now offers its brand partners.
Brand partnerships are not exclusive to F1, of course, and we’re looking forward to a fascinating insight from Matthew Leopold of British Gasabout how the company ripped up the sponsorship rule book as it shaped its partnership with British Swimming. “We had a hard time convincing them that I wasn’t interested in seeing our logo plastered on any bit of real estate they could offer,” explains Matt. “But what we ended up with was a true and very mutually-rewarding partnership.”
Usama Al-Qassab, PlayStation’s European Head of Marketing, brings a unique perspective to the masterclass. Brand partnerships are clearly a two-way relationship, and PlayStation can give its partners access to a very hard-to-reach audience, as well as adding a layer of cool to its partners. Usama will draw inspiration from large-scale partnerships such as the UEFA Champions League, the UK grassroots PlayStation Schools’ Cup and PlayStation’s groundbreaking partnership with Nissan, GT Academy, as he shares what makes a successful brand partnership.
Toby Hester, meanwhile, is a board director of the European Sponsorship Association, but previously held a number of senior sponsorship roles, overseeing football, cycling and Rolling Stones partnerships for T-Mobile before helping steer Castrol through its UEFA and FIFA partnerships.
The hps group masterclasses are all about learning, sharing best practice and peer-to-peer discussion. This is not a hard sell from the agency, but we are delighted to be joined at the event by the group’s new research and brand-tracking business hps MM-Eye who will be available to chat to attendees about using research to help choose the right partnerships and to track their impact on brand favourability.
Brands and rights holders can spend an informative morning at the masterclass followed by some great networking opportunities, a good lunch and, intriguingly, the chance to play some table tennis as we are hosting the event at the