As the eighth staging of the Formula 1 Singapore Grand Prix kicks off this weekend, new research from Octagon suggests that sponsors are winning the race to fan’s hearts.
The sports and entertainment marketing firm recently polled 1,200 people across China, Indonesia, Japan, Korea, Malaysia and Singapore to map how F1 fans use digital, social media and mobile technology to consume the sport and share their experiences with other fans.
In an interview with Campaign Asia-Pacific, Adam Hodge, Octagon’s regional strategy director, said that Asia is slated within eight years to become a powerhouse for sporting events.
Already on the calendar are the 2018 Winter Olympics in Pyeongchang, South Korea, the 2019 Rugby World Cup in Japan and the 2022 Winter Olympics in Beijing, to name a few.
“For F1 as well, Asia is one of their biggest growth areas, with five out of the 19 races being hosted in the region," Hodge said. "So it is timely and important that we focus on finding out what makes Asian sports fans tick, something that no one has really looked into before.”
The Singapore Grand Prix is easily the Lion City’s biggest global sporting event, with the WTA Finals coming in second. Research suggests current title sponsor Singapore Airlines is paying approximately US$14 million a year for the privilege, Hodge said.
“F1 sponsors have a unique relationship with fans," he said. "It’s a sport where the fans willingly buy and wear team clothing covered with sponsor logos. This translates to a closer affinity with the brands that support the driver or teams they love."
Octagon's study shows that Asian F1 fans are even more accepting of the role of sponsors in their sport than European fans, he said.
In short, Asian fans recognise a closer connection to the sport via sponsor involvement, and this translates to a more receptive audience for brands to endear themselves.
Leveraging association beyond contract terms
Hodge said his biggest surprise from the study was how quickly inaugural F1 title sponsor Singtel, which held the slot for five years (from 2008 through 2013), disappeared from fan recall.
“This was such a stark contrast to other sports, for usually during the transition phase from one title sponsor to another, fans would still associate the brand with the sport, albeit incorrectly, for some time," he said. "But Singtel didn’t even make it to the top 10 list.”
In his opinion, this is an indicator that Singtel did not take full advantage of the sponsorship deal to aggressively market its association, and also wasted an opportunity to cement the benefits and extend them beyond the contract term.
While mainstream fans may not remember Singtel, the marketing community certainly does, according to a short survey by font, a specialist recruiter for marketing, digital and creative sectors.
When it comes to brand recall associated with F1, second-time title sponsor Singapore Airlines takes first place at 28 per cent, followed by other iconic brands that shared a place among the marketers’ minds last year, with Ferrari at 23 per cent, and former title sponsor Singtel at 14 per cent.
"Despite not being a title sponsor for two years, Singtel’s lingering presence in marketers’ minds demonstrates the effectiveness of these strategic partnerships for generating leads and connecting with consumers long-term," said Jacqui Barratt, director at font, in a statement.
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Hodge said that there are two key things the firm tells clients wanting to make to most out of a sports sponsorship deal.
"The first is that sponsorship buys you the right to associate your brand with an event," he said. "That’s what you pay for. You can’t just write a big cheque then sit back and wait for things to happen, you have to budget an additional dollar for every dollar spent to leverage it."
The other thing is that brands must invest time and money on understanding the fans. If you get to the heart of what they want from their experience and are able to provide it, you will be remembered. Hodge pointed out that in Europe and the United States, many brands have become very sophisticated about their sponsorship strategies. “They would pay for just two years but are able to leverage the benefits long after the rights window closes,” he said.
Headline findings of Octagon's Passion Shift study include:
- Fans favour F1 sponsors: Eight out of 10 Chinese and Indonesian fans feel more connected to the sport when purchasing a sponsor’s product. Singaporean fans are the least likely to be swayed by sponsors, with only 52 per cent saying they are more likely to buy a product as a result of motorsports sponsorship.
- Trackside signage triumphs over car livery: Trackside signage is more likely to be noticed and remembered than sponsorship livery on race cars, garnering the highest awareness among Koreans (46 per cent) and Indonesians (43 per cent).
- Race tickets are the ultimate prize: F1 tickets are the most attractive purchase incentive across all six Asian countries studied. These are favoured over driver meet-and-greet opportunities and signed F1 merchandise.
- It’s a family activity: With the exception of Korea and Japan, F1 fans overwhelmingly prefer to watch races at home with their family (averaged at 50 per cent).
“The relative scarcity of races each year makes attending trackside a powerful sales driver for sponsors when compared to other sports, with longer and more regular playing schedules,” Hodge noted.
In addition, the study suggests that sponsors wishing to engage Singaporean fans should look beyond traditional advertising channels like print, TV and outdoor and instead provide real fan utility in their activations, such as exclusive race content or VIP experiences.
And when tickets can’t be had or the race is too far away, F1 fans are enjoying the race with family in the comfort of their own homes, in contrast to the tribal fandom often seen in football fans who watch mathces in local pubs.
“Sponsors who are cognizant of the environment and mindset of the fan at this point in time and adapt their messaging to match will have the greatest impact," Hodge said. "A shared familial passion provides many unique opportunities for new and refreshing takes on motorsport marketing for smart brands.”
The exception to the rule
The one brand that has broken all norms when it comes to winning the F1 association game is Red Bull, said Hodge, thanks to its creation of Red Bull Racing via the purchase of purchase of the Jaguar Racing team in 2004.
“Red Bull topped all the charts in our survey for brand recognition and association with F1, across all the countries we surveyed," Hodge said. "Now you wouldn’t immediately associate an energy drink with a sport like F1, but the recognition they have with fans is massive.”
With the Red Bull logo gracing all possible branding real estate at an F1 race, thanks to its status as a participating team, it also enjoys additional revenue by way of selling sponsorship to others. For example, Infiniti, the luxury vehicle division of Japanese automaker Nissan became the team's title sponsor from the 2013 season onwards.
Hodge said that such a move was in line with Red Bull’s overall global approach to sponsorship, which sees the brand rarely sponsoring other properties.
“Red Bull prefers to create their own space or niche to own fully, or in the case of F1, which is an existing platform, to come in as a competitor and make their presence felt in that way," Hodge said. "It is a high-risk approach, but one which has been very successful for the company to date,” he added.
Work hard, party harder
The benefits of leveraging major global sporting events are not lost on marketers as well, according to font.
The survey revealed that social media remains Singapore marketers’ preferred marketing medium for the Singapore Grand Prix, while 50 per cent agree the globally significant event is the most important experience brands should be tapping into each year.
Local marketers were keen to devote more effort in digital platforms, such as social media, with 69 per cent seeing this avenue as the most important.
In comparison, 48 per cent see print and online news media as their preferred marketing channel for F1, with broadcast media and online advertising tailing closely behind at 47 per cent and 45 per cent respectively.
Singapore marketers testified to the effectiveness of leveraging the Singapore Grand Prix for consumer outreach, as 70 per cent believe brands tapping into the event are making worthwhile investments.
And of course, while F1 is an important moment for brands, employers had better be ready for it to affect productivity next week, as marketers plan on enjoying a few good nights out.
"While only 8.5 per cent of marketers say they plan on taking a sick day on Monday to recover, 15 per cent expect their productivity in the office to be affected," said font's Barratt. "According to every single one of our respondents, a little flexibility would go a long way; 100 per cent would appreciate a late start on Monday."
Of those who expect their concentration at work to be affected, 50 per cent said it's because they'll likely be hungover.