Author: James Parrish F1-Confidential.com
Pre-season there was a significant number of sponsorship announcements – more than I can ever remember which bodes well for the sport. One of the larger announcements was BlackBerry’s 3-year sponsorship with the Mercedes AMG F1 Team.
BlackBerry in reverse
Over the past 3 years BlackBerry’s market share had rapidly dropped from 20% to just 6%. BlackBerry now faces the challenge of gaining market share back from the likes of Apple, Samsung, Sony and relative newcomers HTC and ZTE. These businesses have dramatically increased their level of brand equity through continuous investment of time and money into their brand – sports sponsorship playing a central role in all but Apple’s case. BlackBerry has sponsored sports events but had not invested to the level of their competitors.
Subsequent to the announcement I read several articles by marketing journalists questioning the deal and its likely effectiveness of generating BlackBerry enough phone sales to warrant the $12m per annum rights fee. These writers gave no alternative suggestions, only saying that BlackBerry needs to increase phone sales and make an impact on the consumer. So are these journalists correct? Does Formula 1 represent money down the drain for Blackberry? No! In fact I think completely the opposite, I think BlackBerry have signed the best sponsorship they could have possibly done. To explain…
Formula 1 provides global brand coverage to BlackBerry’s target markets:
Formula 1 will provide BlackBerry with a common platform to communicate with over 500 million unique individuals in 187 countries. Frank Boulben, BlackBerry CMO, said the company is splitting its audience into three segments: executives, working mums and teen students. The marketing journalists in question couldn’t understand how Formula 1 would help BlackBerry in any of these market segments. In fact F1 delivers in all three;
- Executives: There are 40,000+ global business executives from the largest global brands in the Formula 1 Paddock Club each year. This represents an unrivalled business development platform for any business, and in particular a mobile phone brand.
- Working mums: Over 170 million women watch Formula 1 annually with the core demographic in the 30-50 age category
- Teen students: Formula 1 is listed as one of the key interests among youths in Europe and Asia and are attracted by the technology, excitement and glamour the sport provides.
Formula 1 provides product relevant marketing opportunities
Question was raised about whether Formula 1 was any better than any other sport at promoting mobile technologies. In Formula 1 mobile communications are a central and highly visible component of team performance.
There is lots to be said here, but let’s focus on the most relevant points.
BlackBerry will be able to place their brand in a product relevant environment – to give a similar example, Vodafone are able to brand the McLaren headphones which directly relates to their product offerings.
Formula 1 is the world’s most data driven and exclusive sport – fans rely on smartphone devices to enhance their viewing experience through dedicated apps, social media, videos and other web content. Frank Boulben talked last year about implementing what he describes as a “real time marketing strategy”; helping the brand leverage its products around current trends, news and conversations. I think this could work better in Formula 1 than in any other sport, engaging F1 fans globally with live-race data, insights and video. How? By utilising BlackBerry’s exclusive access to the Mercedes F1 Team, allowing them to create media rich content that they can deliver to BlackBerry users through a dedicated application or social media channels.
Formula 1 will promote better and quicker innovation
I would argue that one of the main reasons BlackBerry lost so much of its market share was the long periods of time between flagship smartphone releases; Apple releases a new iteration of the iPhone at least every year, Samsung every nine months, and brands like Sony every 6 months.
The BlackBerry 10 was delayed 12 months, and one point the articles I read failed to point out was that Formula 1 teams, such as Mercedes, are leaders in creating innovative products on impossibly short timescales – 80% of the cars design will change between the first race and the season finale.
Some brands enter Formula 1 as sponsors purely for the insights into design and manufacture of ‘products’ to help speed their own R&D and manufacturing. GSK is one current business involved in the sport gaining operational performance improvements from the McLaren F1 team.
Unrivalled for Business Development
Formula 1 will provide BlackBerry opportunity to develop business with 1) mobile carriers (there are currently nine involved in the sport as sponsors) 2) global businesses (220+ that BlackBerry can develop corporate sales through – supplying company phones) and 3) Mercedes, whom I expect will sit down to discuss mobile phone supply for its large global network of employees and dealers.
BlackBerry has made one large step in the right direction in choosing Formula 1 as a way to re-invigorate the brand and develop global sales. I will however say that success depends on their sponsorship activation – you wouldn’t pay to make an advert then not spend on placing it on TV. Sponsorship is the same, you must select the correct property and rights but then you have to maximise them for your requirements. Formula 1 will provide BlackBerry an opportunity to sell an astronomical number of phones however, BlackBerry is a consumer goods brand with exciting products that are meant to enrich our passions and lives. So please BlackBerry get creative and deliver leading edge, exciting sponsorship activation!