Formula 1 threw open its garage doors to overt commercialism in 1968. Sponsorship had until then been low-key: a demure ad patch sewed onto drivers’ universally light-blue overalls, while their cars wore only universally recognised national racing colours.
Livewire Team Lotus boss Colin Chapman was swift to cash in during the new era of sponsorship: an £85,000 annual contract – covering Formula 2 and the winter-sun Tasman Series Down Under, as well as Formula 1 – with Imperial Tobacco’s Gold Leaf brand.
The ‘mobile fag packet’ was go!
Accompanying marketing strategies were as subtle as the blokes they reached out to: instantly recognisable brands selling on perceived exclusivity and unabashed sex and glamour, plus a whiff of danger.
Not much changed over the next 30 years or so.
Renewals with headline sponsors would often be little more than two-page documents with the bill appended. Faxed, they were duly returned, signed. Easy money.
But the 2006 ban on tobacco advertising – although some teams pre-empted it due to strengthening associations with mainstream car manufacturers while others found ways around it – brought huge change.
When a figure like Frank Williams walks into your office to say that he needs £20 million and that partner BMW insists it can’t come from cigarettes, it’s stressful.
But the ban actually created a much more nuanced, increasingly diverse and thus healthier marketplace.
Today, the level of F1 sponsorship demand is through the roof.
It accelerated through Covid – lucky to be one of the few sports to run through the pandemic – and it’s carried on from there.
At the same time it’s incredible how much the behind-the-scenes Drive to Survive documentary on Netflix has changed perceptions about Formula 1 since 2018: it has brought more people into the sport and widened its franchise.
Back in the day you would either go to a Grand Prix – sit in the grandstand, get soaked, go home – or watch it on TV. Then came the platforms that filtered out the part of the mass audience unwilling to pay to view.
Now we consume Formula 1 digitally, on hand-helds, streaming it.
Not until recently have Netflix published viewing figures. What they would only say was that Drive to Survive was its number one factual programme.
Well, its numbers must have been off the clock. For it’s had a huge positive effect: the current profile of the average Formula 1 viewer is both younger and increasingly female. It’s not a male-dominated sport – in the paddock or in the grandstands – anymore.
Plus, it’s well known that the obsession with viewing figures has all but disappeared as well. Is the sport growing, declining or flat? Rarely does anyone question that today. It’s almost taken for granted that people know what F1 is and that it’s strong.
Today, sponsorship prospects are more likely to be those that have never seen a Grand Prix but watch Drive to Survive and are happy to explore opportunities on that basis.
The Gold Leaf Team Lotus deal came about because one of the race mechanics was going out with a secretary from the company handling Imperial Tobacco’s PR account.
The shift in sponsor types is real. That’s evidenced by taking a quick look at the cars on today’s F1 grid. There are less sponsors from sectors traditionally associated with Formula 1; and more tech-sector brands that are increasingly US-orientated.
Tech loves Formula 1 because it’s a high-performance, heavily engineered, total-performance sport. They love being able to advertise a relationship with this incredible property.
But they – and other sectors – are not coming into Formula 1 today purely because they want to increase awareness by putting a logo on the car. A sponsorship proposal these days is a sophisticated commercial marketing document including strategies to meet a potential sponsor’s key performance indicators.
How do they use a Formula 1 team’s assets and imagery to sell a product on the shelf?
How do they engage customers in the Formula 1 experience to showcase what technology it uses and how much it relies on it?
Or it could be: how do they engage with the audience? All these brands need cool content to keep people excited. So, it’s a case of using all the great content that the teams give them for use on social media.
That didn’t exist in the 1990s. It’s moved on a lot from just trying to slap a big sticker on the side of a car and saying: ‘there’s 100 million viewers – and here’s an invoice’.
Formula 1 mirrors the global health of different commercial sectors. There have always been phases. After tobacco we had a lot of banks in Formula 1. Then we had a lot of telecom companies and dot-coms. That’s because they were booming in the real world at that particular time.
A more recent example is cryptocurrency. Suddenly everybody in Formula 1 had a crypto partner – albeit less so now.
Some wanted credibility first and foremost. Others wanted to use Formula 1 to become famous quickly. Unfortunately those going very publically bankrupt had an adverse effect.
The ones that did it properly are getting precisely what they needed from it. And for Formula 1 teams like Alpine – a revived brand wanting to get its cool new message across to younger people – it works both ways.
It’s still possible to get Formula 1 sponsorship wrong. Brands can spend a lot, but need to know what success looks like and how to measure it. It’s all about how you design the deal. For those that get it right however, the returns can be truly exceptional which is why so many brands today stay in F1 for the long term.
Written by contributing editor, Paul Fearnley.