Like the tires in Formula 1, Big Tobacco goes up in smoke

     While looking for that catchy new ad campaign, or the most controversial commercial out there, I found myself drawn into an article not about either or even the success of a particular ad campaign but to the enormous loss in revenue one company has been hit with by walking away from an advertising sponsor and their attempts at filling that void. The company, Formula 1 Racing. The loss, 200 million a year in sponsorship money and free advertising. The market issue, Big Tobacco averaged 350 million a year in revenue from the sport. As I read more I didn't even notice the ticker ads as my mind began thinking of the marketing revenue left on the table.
     Opening with the entangled history of Formula 1 and Big Tobacco, the most iconic team being McLaren in their signature Marlboro Red and White, the article goes on to explain the decision to ban tobacco revenue in 2006 and how the loss of that revenue forced several teams out of the sport. As the dust began to settle teams and Formula 1 as  a company found themselves struggling to find new sponsorship.
     As an International Sport Formula 1 offers a unique value proposition. Their "product" is worldwide viewers and as discussed in the article the opportunities in corporate sponsorship and advertising are numerous. Re-branding the entire Sport is a monumental challenge but viewership is on the rise, corporate sponsorship is up, Formula 1, under new ownership and direction, is looking to build upon their 150 million global viewers.
    In the process of re-branding Formula 1 is contemplating dropping advertising from alcohol, fast food and snack companies and while I can see the reasoning I think their best option is to try and move away from the "elite" image the sport has and embrace the new fans brought in from these avenues. While they will most likely never have the fan base that NASCAR has the right Tech company sponsorship combined with a more inclusive image could easily bring younger fans on board.
     The biggest take away for me in all of this is that vast opportunity presents itself as industry begins to turn away from socially unacceptable revenue streams. 




https://nyti.ms/2Nf9YyY

https://www.marketingweek.com/2018/01/09/formula-one-f1-on-appealing-to-more-women/