Charlotte Smith, Account Director at Synergy Sponsorship, has been at the company for over 3.5 years. She has worked with Formula 1 clients including Martini and Mercedes, as well as across other sports including rugby, football, athletics and tennis. We at Paddock magazine asked her to tell us about what’s hot and what’s not in the sponsorship business.
Since 1968, sponsorship has been the life blood of Formula 1 teams. Fast-forward to 2016, the need for sponsorship is greater than ever as the cost of competing continues to rise. An excerpt from Forbes magazine claims that despite Formula 1 having an unprecedented income in 2014, the teams collectively accumulated a €336.6 million net loss – the largest in over five years. To tackle the ever-climbing costs in a market where available categories are becoming event more restricted, teams need to be more creative about where they are getting their sponsorship revenue from, and the opportunities they are providing potential sponsors beyond the track. We believe there’s more potential to be unlocked if you look beyond those who are lucky enough to actually attend a race, and appeal to those who want to feel like part of the lifestyle.
Given millennials value experiences over wealth, Formula 1 teams and sponsors should be considering how they can appeal to this sought after audience, and provide them an experience away from the expense of the track.
For example, drawing on the host cities for inspiration. The locations across the Formula 1 calendar provide access to a different audience – young millennial urbanites, a demographic almost every brand on the planet is completely fascinated by. As our CSO Carsten Thode has written in this publication previously – the sport has a huge opportunity to both appeal to the millennial audience but also redefine what it means to be a Formula 1 fan through tapping into them. Given millennials value experiences over wealth (89% according to The Cassandra Report), Formula 1 teams and sponsors should be considering how they can appeal to this sought after audience, and provide them an experience away from the expense of the track. Take the Martini Terrazza for example, a pop-up experiential space which allows millennials and indeed fans of all ages away from the track, to soak up the atmosphere of high-end racing whilst taking in the best of the city including art, music and gastronomy.
Teams and sponsors should also be looking beyond Formula 1 itself, and drawing inspiration from other sports as to how to give their audiences a taste of great racing without being at a race (or match, game, set). The Hyundai FanDome welcomes fans to Football Heaven, the ultimate place to experience all the highs and the lows of EURO 2016. Tickets are free and food and drinks are readily available as are places to watch the match and a chance to win tickets to go in person. Even if you were not a football fan, why not head down? And who knows, if you have a superb experience you might leave loving football a little bit more.
The same principle applies to Formula 1. The NFL Tailgate party manages this sort of experience like no other, especially given their relatively limited UK audience. Appearances, performances, interactive activities, food and drink and of course a pop-up merchandise store. I am not an NFL fan, but even I am tempted to go down and engage with the experience, and of course all of its sponsors…