F1 - the marketing and advertising of

[bhall]

Straight from the horse's mouth. Pirelli's ROI on its F1 program is based around an affirmation of brand positioning synergies. And they're quite aware and prepared to deal with potential on-track issues affecting their marketing strategy.

You realize that you've basically just summarized my position on the subject in its entirety, right?

Pirelli feels they've nailed down the high-end demographic through their OEM contracts. Now they're going after consumers in a decidedly different demographic: F1 fans.

Let's not forget that the original question in this discussion asked if Pirelli is damaging their brand image with the "tire lotteries" now associated with F1.

[Cam]

Straight from the horse's mouth. Pirelli's ROI on its F1 program is based around an affirmation of brand positioning synergies. And they're quite aware and prepared to deal with potential on-track issues affecting their marketing strategy.

You realize that you've basically just summarized my position on the subject in its entirety, right?

Pirelli feels they've nailed down the high-end demographic through their OEM contracts. Now they're going after consumers in a decidedly different demographic: F1 fans.

Let's not forget that the original question in this discussion asked if Pirelli is damaging their brand image with the "tire lotteries" now associated with F1.

I think we've finally got our answer on this one. This did go around the long way and yes, the original question was about the potential of brand damage in this situation - not if there was or is - but 'could it' happen. Pirelli have obviously thought about it, as one would expect. They would try to cover off every base. It would be interesting to see to what degree the risk management is on this venture. We'll probably never know. Any business would still yell from the rafters 'we're very happy' even when the boat falls below the waterline. The magic of marketing........

[Cam]

So, moving on to F1 itself, with an obvious push to grow it's audience by 'spicing it up' is this the right communication message for the sport? F1 seems to want to attract more regular viewers just to watch the show, however F1 has a decidedly in-depth technical side - more so than any other sport. I suppose you could argue F1 is a race within a race, with the technical side playing just as much importance on the winner. So, will F1 have to make an effort to educate these new viewers on the intricacy's of F1 tech or will we see a decline in that reporting and coverage - as that may 'bore' people too, and in fact probably would bore the average joe who just wants to see action? Could be a catch 22?

Thoughts?

[Fil]

Straight from the horse's mouth. Pirelli's ROI on its F1 program is based around an affirmation of brand positioning synergies. And they're quite aware and prepared to deal with potential on-track issues affecting their marketing strategy.

You realize that you've basically just summarized my position on the subject in its entirety, right?

Pirelli feels they've nailed down the high-end demographic through their OEM contracts. Now they're going after consumers in a decidedly different demographic: F1 fans.

Your first sentence, yes I told you before we're saying the same thing..

Although in one sense we disagree, fundamentally we're saying the same thing. Brands are in F1 to look successful. How we define that is different i guess. You look at it only at a fan level, others see if from a global market perspective. That's fine. We just need to be open to both.

As was Raymond..

What he means by brand positioning is in the hierarchy of the industry.. ..It in fact confirms what I was saying - that they're in it for branding, and not product recognition/awareness

As for your last sentence, yes they really have nailed OEM.

When you say "F1 fans", you just mean anyone willing to pay extra for a quality tyre, yes? In other words the 'Premium market'.
Their strategy is clearly defined. Yes, they're using F1 to target the 'Premium market'. And no they haven't nailed that yet, they're #5 in the world & their aim is to be #1 by 2015.

Hembery mentions pursuing a global market (currently 33% of their sales are in Italy). Anyone interested should spend 2min on their corporate website and you'll understand where that is. Amongst identified continents, it's primarily Russia (explains why Petrov was linked with Pirelli in the off-season... ).
In fact, they specifically segregate Russia in their forecasts/targets up to 2015.

...the original question was about the potential of brand damage in this situation - not if there was or is - but 'could it' happen.

As for brand damage due to perceived tyre lotteries in F1, yes there is "potential".
Being at the halfway point of Pirelli's contract, it is vital to see if that potential has been realised. Thus-far they have had to deal with spot-fires within F1 circles, but not at POP.

So no, they haven't suffered brand damage "yet", at least not sales-wise & financially.

Net Sales:
2010: 4,772m
2011: 5,602m

Net Income:
2010: 252m
2011: 371m

[Fil]

So, moving on to F1 itself, with an obvious push to grow it's audience by 'spicing it up' is this the right communication message for the sport? F1 seems to want to attract more regular viewers just to watch the show, however F1 has a decidedly in-depth technical side - more so than any other sport. I suppose you could argue F1 is a race within a race, with the technical side playing just as much importance on the winner. So, will F1 have to make an effort to educate these new viewers on the intricacy's of F1 tech or will we see a decline in that reporting and coverage - as that may 'bore' people too, and in fact probably would bore the average joe who just wants to see action? Could be a catch 22?

Thoughts?

F1 is a race within a race within a political ----storm.


Under Bernie, F1 has never made the effort to educate the masses, and post-Bernie FOM probably still won't either. He leaves that up to the media. And largely their aim is sheer numbers, not education. So in that sense, F1 is always going to be dumbed down to highlights & results. And that's how the sport will attract the mass audience. That's also why DRS, Pirelli lottery & 'push-to-pass' systems are F1's sporting future; it creates more action for the masses.

The minority, the die-hard fans, have to discover their own niche media to source the juicy technical & political news themselves. There's little money in that so it doesn't get pushed into the mainstream.

[raymondu999]

I think we've finally got our answer on this one. This did go around the long way and yes, the original question was about the potential of brand damage in this situation - not if there was or is - but 'could it' happen.

This is a bit of a pointless question IMO. No disrespect intended.

For example - a marketing campaign I ran recently for a company of mine focused on convenience and low costs. I'm fine with that because my primary target market were those in the mid-high to mid-low income range. However to a different segment, those above that range - could see it as "it's cheap for a reason - there's no way that thing could be as good as a more expensive product." Those below that range could see it as "it's a scam."

Marketing in itself is an exercise of compromises, especially with so many different demographics, backgrounds, and preconceived judgments in everyone's minds. It's probably why you're very adamant on your point - we're just on a different point along the spectrum, and hence we're seeing (and receiving) different messages. An ad that looks fantastic to you might not appeal at all to another person. Every (disclaimer: every DECENT one) ad - just about - has the potential to make or break a company's image. The better ads just encompass a wider demographic, and have a lower chance of brand damage.

"One man's garbage is another man's treasure," you know?

[Cam]

I think we've finally got our answer on this one. This did go around the long way and yes, the original question was about the potential of brand damage in this situation - not if there was or is - but 'could it' happen.

This is a bit of a pointless question IMO. No disrespect intended.

For example - a marketing campaign I ran recently for a company of mine focused on convenience and low costs. I'm fine with that because my primary target market were those in the mid-high to mid-low income range. However to a different segment, those above that range - could see it as "it's cheap for a reason - there's no way that thing could be as good as a more expensive product." Those below that range could see it as "it's a scam."

Marketing in itself is an exercise of compromises, especially with so many different demographics, backgrounds, and preconceived judgments in everyone's minds. It's probably why you're very adamant on your point - we're just on a different point along the spectrum, and hence we're seeing (and receiving) different messages. An ad that looks fantastic to you might not appeal at all to another person. Every (disclaimer: every DECENT one) ad - just about - has the potential to make or break a company's image. The better ads just encompass a wider demographic, and have a lower chance of brand damage.

"One man's garbage is another man's treasure," you know?

None taken. I like debate and I often learn from it. It's quite informative.

The question was very simple - is it possible Pirelli could suffer from brand damage as a result of the criticisms of the tyres in F1. That was it mate. They 'could' suffer and it seems they admit that and are prepared for it.

As too the degree (large or small) the demographic (retail or performance) is another debate. I think that's where everyone else is coming from, and to some extents, I agree with some of those points. But those points didn't actually say "yes" or "no", they all said "no' and gave many insights into branding and marketing strategies to support their argument.

Could Pirelli suffer brand damage from F1 - yes IMO

Maybe we should drill down into what target market they are truly aiming for here and then the debate would be better formed around if that market would be adverse to any F1 crtitisim?

Personally, I think Pirelli are aiming for mums and dad's - the average punter. They want to put tyres on every second hand corolla out there. Would the average punter care about the F1 tyre criticism? Now that's a debate.

Let's try and determine the target market - Ray, who do you think they're trying to capture here?

[raymondu999]

Personally - I think they're still going for the upmarket. A lot of people know of F1 and its status in the global motorsport hierarchy, much more than the number of fans it has. It's also generally recognised as the fastest form of racing/motorsport out there. Whether or not it is is a different debate.

By aligning themselves with F1 - I think they're showing, "look, the world's fastest racing/motorsport - the pinnacle of motorsport - uses us." This endorsement in my view would have the greatest impact when these people think, "Wow - they were chosen by the best racers and fastest cars around - they must be good."

In the early morning and before any means of coffee or breakfast - it's still early where I am - that's what I can think of, off the top of my head

[Cam]

Personally - I think they're still going for the upmarket. A lot of people know of F1 and its status in the global motorsport hierarchy, much more than the number of fans it has. It's also generally recognised as the fastest form of racing/motorsport out there. Whether or not it is is a different debate.

By aligning themselves with F1 - I think they're showing, "look, the world's fastest racing/motorsport - the pinnacle of motorsport - uses us." This endorsement in my view would have the greatest impact when these people think, "Wow - they were chosen by the best racers and fastest cars around - they must be good."

In the early morning and before any means of coffee or breakfast - it's still early where I am - that's what I can think of, off the top of my head

So with Mr E trying to increase the show by spicing things up - he's trying to grow the audience yeah? Where's that growth coming from? So you think F1 (and by association Pirelli) are trying get more 'up market' people to watch - so they can effect them with brand awareness? Would that be correct, or close?

[raymondu999]

I think the spicing of the show isn't necessarily in linkup with Pirelli's F1 campaign. What I'm talking about is people who AREN'T fans of F1, but know about F1 and its status as the top rung in motorsports.

They probably would get a few more upmarket people to watch F1 due to the whack races this year - but here's the thing with this segment. For those new fans generated by the extra "spicing up" - let's look at the upmarket again.

A) higher-income folks who only KNEW F1 in the past - but never watched it. These folks, IMO, would become fans, and then they see F1 (the fastest racing) using Pirellis. Same story.
B) higher-income folks who made a conscious decision to not like F1 in the past. These folks, if they chose not to see the old F1, and choose to do so now (remember we're talking about additional fans through "spicing up") will think, "you know what? F1 used to be boring, but it isn't now! And you know why? It's these Pirelli tyres giving us fantastic on track action!"

That's generally the generalisation that I'm making. Generally speaking.

[Cam]

I think the spicing of the show isn't necessarily in linkup with Pirelli's F1 campaign. What I'm talking about is people who AREN'T fans of F1, but know about F1 and its status as the top rung in motorsports.

They probably would get a few more upmarket people to watch F1 due to the whack races this year - but here's the thing with this segment. For those new fans generated by the extra "spicing up" - let's look at the upmarket again.

A) higher-income folks who only KNEW F1 in the past - but never watched it. These folks, IMO, would become fans, and then they see F1 (the fastest racing) using Pirellis. Same story.
B) higher-income folks who made a conscious decision to not like F1 in the past. These folks, if they chose not to see the old F1, and choose to do so now (remember we're talking about additional fans through "spicing up") will think, "you know what? F1 used to be boring, but it isn't now! And you know why? It's these Pirelli tyres giving us fantastic on track action!"

That's generally the generalisation that I'm making. Generally speaking.

Let's try and group them.

So, what would be the average age and salary ($US) of the current fan base - so up to 2011. What percentage would it break down too i.e. 10% millionares, 30% high income, 60% low-medium income etc?

Edit: also, anyone know what a set of consumer tyres costs in $US - P Zeros?

[raymondu999]

So, what would be the average age and salary ($US) of the current fan base - so up to 2011. What percentage would it break down too i.e. 10% millionares, 30% high income, 60% low-medium income etc?

I have absolutely never done any F1-related marketing campaigns, and I've never even looked in that direction, so I can't quote figures. If you want to do this though - you'll need to break down who is what. I think generally, it's about how liquid they are. 100,000 in LIQUID financial assets counts as "affluent," until you move up to 1 million, you become a "HNWI" (High Net-worth Individual). 5 million IIRC starts to be called "Very HNWI" before finally you get those above 50 million as "UHNWI" (U = ultra)

[bhall]

[..] I told you before we're saying the same thing..

I can accept that.

I can also accept that I got hung up on a single facet of this discussion, one in which we're not likely to find common ground, because it simply violates everything I know to be true of marketing.

(And it must be said; I do occasionally enjoy standing atop a soap box to shout down upon the masses, "You're wrong! Follow me to righteousness!" Such sentiments readily agree with my inexplicable ego.)

[Cam]

So, what would be the average age and salary ($US) of the current fan base - so up to 2011. What percentage would it break down too i.e. 10% millionares, 30% high income, 60% low-medium income etc?

I have absolutely never done any F1-related marketing campaigns, and I've never even looked in that direction, so I can't quote figures. If you want to do this though - you'll need to break down who is what. I think generally, it's about how liquid they are. 100,000 in LIQUID financial assets counts as "affluent," until you move up to 1 million, you become a "HNWI" (High Net-worth Individual). 5 million IIRC starts to be called "Very HNWI" before finally you get those above 50 million as "UHNWI" (U = ultra)

Okay, so I've dug up some stats from a widely read publication (both print and online) that covers F1. In fact, you probably read it (and most others on this forum would too). Although the exact demographic will not be spot on, I think we can draw some similarities between both F1 and this publication to assume F1 is talking to the same market.

• appeals to most levels of society, but is especially popular with professional people from a more affluent background.
• majority under 55. 60% are between 25 and 55. 16% in their late teens or early twenties.
• 84.9 % male & 15.1% female
• 20.5% earn £30,000 - £49,000

Would you agree?

If so, looking at this, where is F1 now (with it's 'spice it up' campaign) trying to increase it's viewership from? Thoughts?

[Jersey Tom]

If so, looking at this, where is F1 now (with it's 'spice it up' campaign) trying to increase it's viewership from? Thoughts?

Everyone. 0% of the demographic enjoys watching / paying to watch a boring event.