Following this week's confirmation that Formula One's long-serving chief executive Bernie Ecclestone has been removed from his position - with Liberty Media completing a £6.4bn takeover of the sport - Mongoose director, Rupert Pratt, offers his views on what needs to come next for the sport...
The success of F1 so far has only been down to one man, Bernie Ecclestone who ruled the sport with an iron fist to turn it into the top motorsports series in the world, not to mention an incredibly profitable business. A ruthless entrepreneur, Bernie’s stakeholder strategy made the Art of War read like a nursery rhyme. Often dipping into his own pocket to bail out the sport / teams when needed, he also made billions himself. His secretive, divide and conquer approach ensured he always had the upper hand at the negotiating table and ensured that the many stakeholders knew who was the boss. This approach was probably crucial to CVC Partners who bought the sport – keeping everyone on check and stopping the sport from imploding under new leadership... All successful dictatorships only struggle when they need an heir and most successful entrepreneurs sell the business in order to assist its growth.
Bernie Ecclestone with his now replacement Chase Carey in 2016
Don’t get me wrong, the F1 journey has been incredibly successful. Bernie transformed the sport from an amateur series, with aristocrats and chancers racing round WWII airfields into a multi billion business. He was an innovator and innovated. However successful the sport it is, it had probably grown too big for the current management approach, and desperately needed change. Sport is undergoing huge changes with many having to reinvent themselves to maintain their relevance and popularity so what are the likely changes for F1?
The first indication of F1’s new owners approach is the careful management of corporate communications and PR. The Bernie announcement didn’t come as a surprise (despite him saying he’d been asked to stay on for another 3 years) nor was it denied, leaked or suddenly announced. Instead, there came a number of carefully written articles speculating that Bernie’s time was over but also outlining the positive changes that Liberty would bring.
Don’t get me wrong Liberty aren’t a soft touch John Malone’s not nick named Darth Vader for nothing but I expect that iron fist to have a glove on it
1. Put the fans first
Liberty are a US operation and also owners of the Atlanta Braves baseball team. The US model is very simple put the fans first. The first question the NFL asks before making any decision is ‘what will the fans think, will they like it’? if the answers no, it doesn’t get any further. Therefore all the other points below relate back to the above
2. Look after the teams – ALL the teams.
Fans love competitive sport. It is why they watch sport. They want excitement, surprise and drama this is what live sport is all about the power of the unexpected, live and then sharing those moments. The F1 remuneration structure is dysfunctional and complicated to say the least the output of this a legacy of single team’s dominating over long period and the middle and back of the grid struggling to stay in business let alone compete. The result is the long documented bore-fest which only turns fans, broadcasters and media off. The appointment of Ross Brawn is very smart, it will ensure that the teams are heard and any innovations and changes are practical for the teams.
3. Look after the drivers – their personalities and the new ones you don’t know about
Fans buy into personalities – for too long the sports personalities have been stifled by a prehistoric format and governance. A by-product of over professionalism and commercialisation in any sport is that it becomes very corporate and safe in its communications. Access to the drivers by the media is limited to a stiflingly boring press conference that even the drivers can bare (with Lewis Hamilton having to take Snapchat to maintain his own interest) and snatched pit questions (just when they don’t want to be asked questions) Access to the drivers by the fans is limited to parade lap in on top of cars – not exactly getting close to your heroes
4. Shorter formats, more uncertainty, more winners
Everyone knows the media is dominated by short, sharp content on demand. Qualifying is exciting because it is short and has an element of the unknown, is taken right down to the wire. Everyone knows the least exciting part of the race is the race (bar maybe the first corner and the pit stops). F1 could pack up after qualifying and go home. Expect more pit stops and innovations to change the race around, make it harder to win etc. I don’t expect a Formula E style ‘fan boost’ but I wouldn’t be surprised if they did something akin to having two shorter races and reversed the grid. Ultimately we need a ‘title race’ every year.
5. Pre-promote – destination viewing
The US has Super Bowl expect every race to become destination viewing with pre promotional and marketing. F1 innovated with F1 Rocks, a music concert on the Saturday night ….. for those that had tickets. Liberty have gone on record saying the want races in London and Las Vegas (as well as protecting the heritage races). I’m not sure street races are the answer (for a variety of reasons)– why not hold them as pre-promotional events, taking the sport to the (new) people and providing much needed content and PR for the race venues who need a return on their rights fee?
6. Broaden your reach – quality of broadcast distribution and less production costs
F1’s historical commercial success was based on three things, TV, TV & Race hosting fees in new and emerging economies. However this model is waning, due to a combination of reduced interest and pay per view (which in turn makes more money). From a sponsorship perspective this agenda has moved on and an F1 car was hardly the most practical billboard. F1 needs is new audiences and quality of content. Most broadcasters have struggled to make a return their rights fee and the cost of quality race production.
7. Consume the sport anywhere on anything, at anytime
As they grow their distribution expect to see it become more diverse and fragmented. From millennials to generation Z we all know that current media consumption is all about right here, right now, where I want however I want it. Sky is doing a great job of this with a dedicated channel, Sky Go, and social media but F1 (and sport) needs to experiment and engage with new platforms and content formats. The media landscape has moved on
8. Content and digital is king
In order to grow F1 needs to be more accessible again to new audiences and also educate and engage them into fans. This requires a complete content and digital distribution overhaul. F1 is being distributed and consumed on Facebook, Twitter, Instagram, Snapchat, etc. but I wonder what they think about the sport
9. Protect the heritage
History, heritage … that’s the thing money can’t buy
10. Invest in order to reap your rewards
That’s why Liberty are here. It’s going to be an interesting few years...