Simon Drake, CSM Asia
Cracking Asia is easy. That would be quite a statement! Anyone who says there is one simple solution to growing Formula 1 in Asia is lying. However, it’s not impossible either.
Before purchasing Formula 1, Liberty Media saw that the rights holder was under optimizing their asset globally. So when they bought it for $8bn USD they got a steal. By slowly fixing the basics – starting with a market orientation mindset and focusing on what the consumer wants - they have already given us a glimpse of what’s ultimately possible. While they’ve got off to a good start, one of their biggest challenges remains: how do they intend to invigorate the most populous continent on the planet: Asia.
To crack Asia, you’ve got to understand Asia. It’s not like North America, where the majority of the population speaks the same language, or Europe where each nation is largely developed to the same socio-economic extent. In addition Asia doesn’t have the same deep heritage in motorsport as the Western continents. Asian countries don’t have these basic building blocks – so one solution to Asia isn’t possible.
Breaking it down.
- Japan is a developed nation with a deep rooted car culture – as close in tradition to the US or Europe as you can get in Asia
- Singapore is a sovereign city state with a plan. It has a well thought-through and well-funded plan to put itself on the map as a finance powerhouse using the glamour of motorsport
- The Philippines is made up of around 7,000 islands and has a developing middle class in some areas, and aching poverty and insufficient infrastructure in others. A growing car culture but bikes still rule
- Indonesia has wealth and poverty in extremes, poor infrastructure and fractious politics. They have a love of bikes and the complexity of being made up of some 18,000 islands
- India has a huge population, but as we’ve seen from previous Formula 1 forays, cannot let go of its feudalist tendencies that bring commitment to a long term growth strategy for automotive to a grinding halt
- China – the ‘holy grail’ for brands and rights holders alike – is developing fast with a booming middle class and is the biggest new car market in the world, overtaking the USA in the process
- I could continue with Korea, Thailand, Vietnam, Malaysia etc – but you get the point – all different from each other and from the heartland of Formula 1 to date.
But hang on, back to China - it sounds perfect? But (and it’s the biggest but of all) China doesn’t follow in traditional footsteps in anything it does. It’s skipped through what the USA, Europe and Japan would consider the building blocks of a love affair with the automobile – straight to a car being a ‘thing’ at two ends of the usage spectrum. It’s either a means to get from A to B, or a status symbol. There is little mainstream understanding or desire to enhance, modify or experiment with individualizing cars. Upgrading in China doesn’t mean changing wheels, adding an aftermarket exhaust or an ‘AMG-pack’. It means giving your current car back, and getting a brand new one – and in that process changing brand, changing from a saloon to an SUV, and even changing from petrol to electric – Quantum leaps in old world thinking. And how do they select their car? Not by whether the brand has won the WRC, LeMans 24hrs or has an engine honed in Formula 1. By colour, by price and availability, or by what the influencer they follow on social media says. Reality is stranger than fiction.
So what to do ? Like every good strategy, the solution is to keep it simple and keep a laser focus on the consumer. Formula 1’s strategy for Asia could look something like this:
- Singapore – the simplest market. Leave it alone - they gave us modern city based Formula 1, with layers of vibrancy and excitement well beyond the on-track action. If anything, give them greater freedom to trial a few new ideas
- Japan – visibility is everything. Get Formula 1 back on free to air. Don’t be afraid to reinvigorate the old guard and the grey pound. Japanese viewers only disengaged because Formula 1 went dark on them. In parallel to TV, let people get hands on and show the car mad current monied generation that Formula 1 is still the pinnacle of racing by doing a ‘Tokyo live’
- In China – as in Japan, visibility is key. To anyone who’s not opened an atlas or travelled from Europe to Hong Kong, Singapore or Australia recently, China is MASSIVE. Formula 1 needs to invest in making Formula 1 visible and accessible to both the individual social media influencers, and the social channel owners. Getting back on CCTV wouldn’t hurt either. China needs street demos, exhibition events with social media influencers driving the cars, and 3 races per annum to shift the needle of interest.
- India – Don’t fight cricket, learn from it. Go short format and embrace some Bollywood craziness. Do they need their own race – probably – but that can come later. A great starting point would be having an India driver in a race winning car for the nation to get behind
- Indonesia, Thailand, Vietnam and the Philippines – Building Formula 1 in these markets in a way that avoids the white elephant syndrome is a 5-10 year project. Thinking otherwise is just kidding ourselves. The first question to ask is why anyone should feel that Formula 1 needs to be leading in these markets? It doesn’t. Let GT racing, Touring cars and TCR lead the charge here – link motorsport with road cars before rolling out multi-million pound open wheeled racers. Thinking otherwise is akin to opening a Rolex watch store next to Oliver Twist’s workhouse and expecting watch sales to pick up from the local community! It’s the wrong tool at the wrong time and could bring the Formula 1 brand crashing down.
We all want Formula 1 to top the 1 billion unique viewers mark, and Asia is a key piece in the jigsaw. One size won’t fit all but with some good insights, a nimble strategy and a focus on what the consumer in each market needs, success is very much attainable.