The formula that works for brands
By Samiran Saha | Published: 07th October 2012 12:22 PM |
In the first-ever Formula One (F1) Indian Grand Prix held at Buddh International Circuit in Greater Noida, a tony suburb of New Delhi, on October 30 last year, one of the speed machines crashed into a side panel put up by logistics giant DHL. The incident was not unusual for the sport. What made it so was the TV cameras lingering on the crash, and the DHL signboard getting great display at a time the worldwide audience for the events was estimated at 500 million. “To advertise for that long and that too in an international sporting event like F1, DHL would have had to spend serious amount and what we are getting here is pure brand building and that too free of cost,” a DHL official had admitted at the time.
That one incident, or accident, put the power and reach of the brand recognition that F1 offers into focus. With the kind of mass appeal and tremendous brand equity that it enjoys worldwide, there are very few sports that can compete with F1 racing in offering advertisers a medium to reach out to over 500 million viewers.
With glitz and glamour at its best, the build-up to a F1 Grand Prix event offers brands the perfect platform for engaging with potential consumers. Advertisers are believed to spend huge amounts of money (advertisers keep their ad spends a closely guarded secret) to make their brands recognizable on F1 cars. “It is one of the big advertising platforms today because of the great degree of interest in the sport itself. F1 racing is on top of the pyramid right now, along with the other niche sport-Golf. Sports have developed a caste system of viewership so while F1 and Golf are right on top, the middle order is held by Soccer and Cricket is at the bottom of the pyramid. There is a lot of drama around the sport in restaurants and pubs and it is a good platform to showcase your brand,” says brand consultant Harish Bijoor.
When F1 started in the 1950s in Europe, the Grand Prix cars ran without any badging, using national colours. However, as the cost of the sport rose, sponsors became important.
Bharat Bambawale, Global Brand Director, Bharti Airtel, which is also the title sponsor for this year’s Formula 1 Airtel Indian Grand Prix says associating with a brand like F1 has huge advantages.
“Formula One today enjoys the cult following of a whopping 500 million plus fans. With 200 million plus customers, Airtel has huge customer base representing the young and vibrant population. Hence, it is only natural that Airtel and Formula One together bring to life the dreams of millions of young and passionate sports enthusiasts in India.”
About how Airtel’s tie up with Mercedes AMG Petronas F1 Team will help AirTel as a brand, Bambawale says, “Bharti Airtel and Mercedes AMG are associated with traits of speed, stellar performance and fast pace growth making this partnership a perfect match between two likeminded brands. By leveraging Mercedes’ long-standing motorsport heritage and strong track record on the F1TM circuit, we look forward to building an emotional asset that will compliment brand Airtel’s youthful positioning and appeal to thousands of Formula One fans across India.”
Historically sponsors’ role is most important in promoting Formula One teams which get 80-85% of their total income from sponsorship. The remaining 15% comes from TV revenues and prize money. This itself explains the importance of sponsors in F1.
While it is extremely expensive to be a part of the F1 extravaganza, Sanjay Sharma, Head- Motorsport, JK Tyre & Industries says, “Motorsports at this level is way ahead of times. The development at this level helps brands and companies to reap results for many years to come as it is a known fact that it costs couple of million Euros at this level of development to find one second in the world of racing. Therefore, this association gives you instant glory and the product its credibility.
“Such initiatives certainly help in business besides getting the right fillip in positioning your brand as young and dynamic and ahead of times in technology,” he adds. Sharma says though a company has to pay a substantial amount to Formula One Management, what one gets in return is “to showcase on a platform which is not amongst the best but the best.” Formula 1, world over represents an evolved and contemporary lifestyle and is the epitome of technology, fashion and glamour. The Mercedes-Benz brand mirrors these attributes.
“With a rich legacy, F1 stands for sophistication, style and substance thus providing the ideal platform for Mercedes-Benz that blends harmoniously to its own character,” explains Debashis Mitra, Director-Sales and Marketing, Mercedes-Benz India. What does advertising on the F1 platform do to a brand, Bijoor explains, “Typically the brand feels premium, expensive, exclusive and elite. If you have an entity that believes in all these principles, then this is the best platform for you.” Now over to October 28 for the action to unfold.
And if it is just fashionable to advertise F1 platform to which Bijoor says, “At this point in time, it is just fashionable. Marketeers will tell brands that F1 is a good platform to create an image. ”
(With inputs from Sharan Poovanna in Bangalore)