F1's future stability still up for debate

05/02/2013

10 Comments

 
Is Formula One looking at a bright new future of supersponsorships from global brands, or is the outlook somewhat gloomier? Based on comments made by two team principals from different ends of the grid, it's all a matter of perspective...

“I think we are affected by the cycles of the economy of the world,” Brawn told Autosport. “We cannot ignore that. There is a lot of positive and proactive work to try and contain the costs within F1. There is constant debate/discussion within F1 to see better ways of doing that, but I think we are seeing a lot of positive signs.

“We have had Blackberry join us as partners and there are other people joining F1 because they can see the value of it. It is a constant battle. We can never rest and say that it is okay. We've always got to be working to contain costs and improve the quality of F1 and make it more appealing to our partners and sponsors. And it is a constant battle.

“In the 30 or more years that I have been involved in F1 it has never been very different to be honest. There are always one or two teams at the bottom who are perhaps struggling to meet their budgets. It is cyclic – but there is still a very strong core to F1.”

Brawn was speaking before news of the Emirates deal had broken officially, but it is very unlikely that the Mercedes team boss would not have been aware of it. But while the airline's decision to sponsor Formula One is great news for sport as whole, financially it's less of a result for the teams.

The hope is that Emirates' vote of confidence will attract the attention of cash-rich blue chip brands who might be tempted to invest in teams the length of the grid. At the back end, where Heikki Kovalainen and Timo Glock have both lost their seats to drivers with personal sponsorship to add to the team coffers, belts are the tightest they've ever been.

“I think the economic situation is worse than it has ever been for everyone,” Caterham team principal Cyril Abiteboul told Autosport. “I think there is one single team that has been able to do an amazing job both on track and from a commercial perspective, and that is Red Bull. But they have had the luxury of a shareholder who was helping at the start with no great sponsors. I think everyone else is suffering.”
 


Comments

Jem
06/02/2013 12:17

Perhaps the problem is that there's a difference between F1 as a brand and the individual teams as brands.

The impression I get (and anecdotal evidence is always sketchy as hell) is that the middle-aged and older F1 fans are likely to back a certain team, Williams being a very popular choice, while the younger fans will perhaps back a driver or just get all nationalistic about it.

That's certainly my stance. The only team that has retained consistent as a brand in the time I've followed F1 (20 years, give or take) is Ferrari - and courtesy of the Schumacher domination they're "the enemy" by virtue of being foreign and too successful.

Only three teams have even kept their name consistently throughout the period. McLaren have remained largely colour consistent since they started with West. Williams have been sketchy as they've struggled with sponsor deals - the Rothmans colours are the closest to my heart - but Williams also upset my generation of kids by dropping first Mansell and then Hill.

At the end of the day, I follow F1, not a team. I have certain favourites, but more for the drivers than the teams.

The obvious British comparison is Premier League football, where 7 of the teams have remained in the division throughout the past 20.5 seasons. None of those 7 have retained a long-term change to the established home kit pattern (off the top of my head, Arsenal and Manchester United have resurrected "classic" kits to mark big anniversaries) and the names obvously remain unchanged. Even the team logos are largely untouched, despite 20 years in which branding and visual identity has become a major industry.

Even those teams who've dropped out of the Premier League still exist and in many cases find their way back into the big time. It's consistent and solid and stable. It's a structure that breeds relationships not just with the sport but with the teams that compete in it.

And that sells merchandising. It sells shirts. It sells posters. It creates a new generation of fans from the kids whose dads already support a club. Which means that kids go to bed at night next to a massive Aon logo, they see Aon logos every day at primary school, they wear Aon logos when they go shopping in town.

F1 fails at this stuff, at least in part because F1 team ownership is just an extension of wider branding and advertising. The Brackley Team have had three previous names since they were founded*. As have The Silverstone Team. The Enstone Team might well match that if/when Genii sell up. The Faenza team were once called Minardi.

Ironically, I can't help wondering that if the teams had been called "Brackley Racing" and "Enstone GP", they might still exist under those names. The fact that most teams get named after owning companies or privateers is the problem - when the owner changes the branding has to go, taking with it any and all goodwill earned. Ron Dennis's decision to maintain the McLaren name is probably one of the most cunning long-term strategy calls he's ever made, hopefully after FW goes the Williams board will do the same.

The worst thing? The worst thing is that the only team in recent years to avoid being named after the owner, to look like trying to start a legacy under a consistent banner, was a little squad called HRT...


* = I'm not counting Tyrrell in this one...

Reply
elephino
07/02/2013 06:19

Here, here :)

Though the Premier League analogy doesn't quite work. While 7 teams have remained up there, those that fall down are capable of coming back. In F1, if you fall out you're almost completely guaranteed never to return.

If you go through the history of F1, very few F1 teams haven't been named after the owner or the owner's company.

Reply
Kate link
07/02/2013 10:52

But what else would you call it? I think we should start naming teams after famous artists, or favourite novels.

The Middlemarch is gaining ground on the Caravaggio, but as the pair duel around the chicane they are neatly passed by Bob, on a charge in his Metallica.

Jem
07/02/2013 12:27

Yes, there are structural differences between F1 and football which arguably encourage a more short-term attitude to team management. Football teams regularly survive relegation and administration and often slowly bounce back up.

Perhaps too it stems from the very beginnings of these teams. Race teams require capital from the outset and that capital tends to come from one big investor, either a person or a company. Football clubs, at the very beginning, tend to be formed by a group of equals coming together to kick a ball around.

The reason I brought it up really was to point out that the Premier League is a big brand but is dwarfed by Manchester United, whereas I'm not actually entirely sure that Ferrari really towers over Formula 1 - certainly no-one else does, whereas Liverpool, Chelsea, Arsenal, Manchester City can all make claims...

My stance is that the ego-centric "name it after myself" attitude is a dangerous one in terms of brand impact - which affects team finances. It encourages shifting allegiances and discourages fans buying merchandise. I loved the Brawn GP "look", but knew it would be redundant within a couple of years at most. In 20 years time, there'll be a generation of F1 fans who've never heard of Brawn GP and they'll exist as nothing more than a particularly taxing pub quiz question.

It's not all doom and gloom. Not all teams appear to be run in such a way. Williams will probably be Williams long after Frank leaves us and even if his descendents leave the company. McLaren will remain McLaren. Sauber seem likely to retain the name even as Peter passes the torch to Monisha Kaltenborn.

You're right elephino, very few F1 teams haven't been named after the owner or their company. And in terms of brand awareness, brand association and therefore merchandising and sponsorship opportunities : that's a bad thing.

Kate link
07/02/2013 13:08

I wonder whether the link between fan alliance and team longevity is causal or coincidence...

My instinct is the former.

Jem
07/02/2013 14:58

What'll really get you scratching your head is the question of which one causes the other...

elephino
08/02/2013 01:38

In regards to brand association, it's good for the owner/company but yes no longevity for most of them.

And you're right with football. USF1 suffered from this (amongst other issues but let's not get into that) that they didn't have enough money to get to the first race. Whereas, I could start a local football club, get some success, build sponsorship, etc and one day make it to the Premier League - though that would take quite a few years.

Part of it is where each sport has come from (jumpers for goal posts vs gentleman (and lady) drivers).

As for Williams remaining Williams, that's going to depend on who takes over at the top of the team when Frank is no longer there. If you look at McLaren, they could easily have had their name changed if it hadn't been Ron Dennis making the purchase. The same went for Brabham. If you then compare it to Jordan, which had enough cachet to have the name remain without any troubles but those that bought the team had other ideas.

P.S. Force India weren't named after the owner.

Jem
08/02/2013 10:47

Technically yes, but even with the same business portfolio on the subcontinent, if Vijay Mallya weren't Indian they wouldn't be Force India.

I might take to calling them Force Ireland as a nod to the Jordan origins.

With Williams, I suspect a lot will depend on how much they develop their extra-F1 activities and whether the F1 team remains part of the wider group. By the same token, whoever takes over McLaren Group or Ferrari probably won't be in a rush to rename the teams attached to said companies.

Kate link
07/02/2013 10:50

I like the PL analogy you've got going on, and I think you make a lot of good points. Those teams that do inspire brand loyalty - McLaren, Ferrari, and Williams - all have an essentially unbroken line to their origin, even if there have been minor naming tweaks along the way.

I guess that's why we've seen a recent attempt to cash in on that with the rebooting of the Lotus brand, and the introduction of Caterham.

I'm not really adding anything here, am I?

Reply
Alianora La Canta link
08/02/2013 13:56

I think team longevity causes fan loyalty. I'm considered unusual, even among Force India supporters, in that my loyalty to the team is unbroken since it was Jordan. Most of the Jordan fans decamped in the Midland and Spyker days - those who are loyal through one changeover rarely stick around through the second because the implicit promise that the replacements would stick around is broken. There was a time when I took to calling the team "Jordan/Midland/Spyker/Force India/whatever-it's-called-this-week" in reference to the team's chameleon identity. That's reduced a lot since Vijay managed to last more than one season, though in times of uncertainty it still appears in my writing.

Force India is called that partly because calling it UB Group Racing would have been a meaningless name, Vijay wanted to connect all of his brands rather than just one to the F1 team, and Vijay's brand of self-promotion doesn't encompass naming things after himself. At that point he was more interested in promoting himself as the embodiment of Indian interest in F1.

In F1, fan loyalty rarely affects team longevity, purely thanks to the amount of money involved. Football is different. My home team, Chesterfield FC, would have ceased to exist 12 years ago had it not been for its supporters' club buying the team out and sorting its financial affairs. It is now more or less back to where it was before it encountered the clueless boss who caused that problem - and picked up a new, high-quality stadium and won a couple of trophies in the process. (It also got promoted and relegated, but that was after the supporter's club sold the club - they'd only intended to own it long enough to solve the financial problem).

Most examples of football teams' existences being extended by fan loyalty are a bit less extreme, but generally fans have more power in football.

As for the Lotus thing, that was tacky on the part of all involved. Most fans will associate Lotus with the 90s-and-earlier purveyor of supercool technologies, not the 2010s branding exercises of large companies.




Leave a Reply