In April, on a stage lit up in green neon, topped with Heineken’s logo and red star, the Dutch DJ Armin van Buuren and the singer Angela Zhang performed for Chinese Formula One fans.
The three-day event, billed as F1’s first fan “festival”, took place in the centre of Shanghai, 40km away from the city’s racetrack. For F1, it was a chance to win over fans who could not make it to the race. There was a chance to see former world champions Sir Jackie Stewart and Nico Rosberg and to test out F1 simulators.
For Heineken, as well as other top sponsors such as Emirates, Pirelli and Petronas, it was a chance to stretch their multimillion dollar “partnerships” with the motorsport beyond the racetrack.
A pilot for the Shanghai event took place in London last year, with 100,000 people in Trafalgar Square gathering to see drivers and teams ahead of the Silverstone Grand Prix and indie rock band Kaiser Chiefs perform on stage.
“The sponsorship environment is much more active with the new administration,” says Tim Bampton, a spokesman for McLaren’s F1 team, referring to changes brought in by Liberty Media, who took over the sport in January last year. “They are coming with initiatives, e-sports, fan festivals — they want to create a more engaging environment for the live audience and help our partners feel that they are able to access that audience more easily.”
With Live Nation, the US events promoter, now also part of the Liberty’s F1 group, it is perhaps no surprise that McLaren feels Liberty is paying a “higher degree of attention” to the live audience as well as satisfying F1’s traditional television fans.
“The days of sticker and cash are gone,” says Bampton, referring to the passive sponsorship of the past where companies simply stuck their logos on the race cars. “The demands of new sponsors have changed substantially.”
It was Bernie Ecclestone who signed up Heineken as one of F1’s handful of “global partners” in 2016, after a two-year courtship. The former chief executive pursued a strategy of attracting blue-chip sponsors who wanted to reach the sport’s global TV audience. The top brands “get worldwide coverage and association with a premier sport”, he told publishers Campaign Asia in 2014.
“I believe the big sponsors want to be able to offer their clients some form of entertainment, an experience that money can’t buy,” he said. So, “if they sponsor us or one of the teams they can meet the drivers and it’s all a bit special.” He willingly admitted, however, that he saw less value in the interaction with fans at races or online.
Liberty says it offers sponsors many more ways to put themselves in front of potential customers, from events related to grands prix, to virtual sponsorship through F1’s e-sports series, to social media and digital channels.
While Ecclestone tightly restricted access and video filming around teams and the pits, Liberty is happy to let sponsors use footage from the track. “One easy area to point at, which is the one big difference in the past 12 months, is digital and social,” says Bampton. “We are able to access more content that would have been restricted.”
F1 made about 16 per cent of its $1.8bn of revenues from sponsorship in 2017, a fall from nearly 17 per cent the previous year after two big name sponsors, Allianz and UBS dropped out of the sport. Despite hiring the agency CAA to boost the search for sponsors, it did not sign any major deals in the year.
The sport, and its race teams, face a threat from Formula E. The all-electric race series takes place in city centres, rather than remote racetracks, and markets itself as environmentally friendly and more attractive to a younger crowd. Fashion company Hugo Boss, for example, said it decided FE was “more innovative and sustainable” when it decided to switch last year after several decades of F1 sponsorship.
This year Liberty has succeeded in renewing a partnership with couriers DHL but it has yet to announce renewals with other top line sponsors. Sean Bratches, F1’s commercial boss, told SportsPro Media in March that later this year there will be a further digital push.
“We are relaunching FormulaOne.com in midyear, which will be a commercial site,” he said. “Today, if someone wanted to put a display ad or a pre-roll or a post-roll video ad on FormulaOne.com, they couldn’t do it. The site is not set up technically to facilitate that, which is somewhat anachronistic in the world in which we live.”
F1 sees an opportunity to widen the portfolio of sponsors, in the way that football teams such as Manchester United now have global as well as regional “partners”, spanning different products in different countries.
For F1 teams, the sport continues to have appeal both for lifestyle brands and for technology companies, which spot a chance to demonstrate their products.
“Tech is playing a bigger role” and companies such as Dell and NTT are “using F1 as a prove point for products and services”, says Bampton. “We have seen a shift in tech businesses aligning themselves with the sport and teams to help tell their story in terms of what they can deliver in speed and capacity and true partnership in terms of technology and solutions.”