Cohesion, brand messaging improvement key for Hulman’s new hires

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Consider Mark Miles the head coach of the Hulman & Co. organization, and this football analogy describing IndyCar’s future strategy will work.

Miles, the head of IndyCar’s parent company, finalized his leadership team on Thursday with the hires of C.J. O’Donnell as Hulman Motorsports chief marketing officer, and Jay Frye as chief revenue officer. So consider these two part of the coaching staff: maybe your offensive (pushing the product) and defensive (protecting the financial bottom line) coordinators.

The rest of the coaching staff, as it were, are Derrick Walker (INDYCAR president of competition and operations), Doug Boles (president, Indianapolis Motor Speedway), Robby Greene (president, IMS Productions) Gretchen Snelling (general counsel) and Jeff Belskus (president, Hulman & Co.).

“We believe that that separateness led to a less than effective, than maximally effective way to deal with our stakeholders,” Miles explained during a teleconference on Thursday. “It doesn’t make sense to us optimally to segregate based on kind of the location. Really the businesses are part of the same industry, same ownership, and largely the same stakeholders and customers.”

Collectively, they’re the new administration working together for the first time as a group, to bring about change to a struggling organization.

IndyCar is the opposite of a bad football team, for example. It has a great product, but remains largely invisible to the general public. Whereas a bad football team, i.e. the Jacksonville Jaguars this year, puts out a bad product but still gets a decent ratings number both on local and national levels.

The task for Frye and O’Donnell, who have each turned around organizations and brands in the past, is to do likewise for IndyCar. You might be thinking, “Well, aren’t these two just the latest to try?” The initial message from the conference call was positive that changes seem legitimate in coming.

“It’s been really kind of unique since this was announced today, my phone has been blowing up, and a lot of them have been from friends of mine who are prospective sponsors,” Frye said. “So I think the opportunity is definitely there to do some really good things actually relatively quickly.”

The biggest task on the sponsor standpoint is finding a replacement for departed title sponsor IZOD.

“Once that partner is identified, that actually helps address a lot of the things we’ve talked about,” Frye explained. “One is activating the sport, one is promoting the sport, one is getting the fan engagement together, which is very important to the overall health of the sport. Really the first week we’re going to kind of figure out where we’re at, try to get the groups blended together, get a nice plan and goals and direction, and then once that’s done we’re going to hit it hard to go out and find a great title sponsor partner.”

O’Donnell added that beyond the partner activation, an the PR and marketing effort will be improved and enhanced.

“I’ve got definitive assurances of that,” he said. “In fact Mark and I have had several conversations about adding capacity to the organization to really develop it into a world‑class marketing and PR team.”

For O’Donnell, the chance to come full circle to Indianapolis is a dream come true after 20 years with Ford and associated brands.

“I have to add a passionate sort of personal note to this,” he said. “At one point in time in my life I had an aspiration of actually driving at Indianapolis, and I knew someday somewhere I’d get a chance to participate in the business.”

Street race in Vietnam could lead Formula One’s Asia expansion

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TOKYO (AP) — Formula One is expected to add more races in Asia, including a street circuit in the capital of Vietnam, a country with little auto racing history that is on the verge of getting a marquee event.

“We think Hanoi could come on in the next couple of years, and we’re working with the Hanoi government to that end,” Sean Bratches, Formula One’s managing director of commercial operations, told the Associated Press.

There is even speculation it could be on the schedule next season, which Bratches rebuffed.

Vietnam would join countries like Azerbaijan, Russia and Bahrain, which have Grand Prix races, little history in the sport, and authoritarian governments with deep pockets that serve F1 as it tries to expand into new markets.

“This (Hanoi) is a street race where we can go downtown, where we can activate a large fan base,” Bratches said. “And you have extraordinary iconography from a television standpoint.”

A second race in China is also likely and would join Shanghai on the F1 calendar. Bratches said deciding where to stage the GP will “be left to local Chinese partners” – Beijing is a strong candidate.

Bratches runs the commercial side of Formula One, which was acquired last year by U.S.-based Liberty Media from long-time operator Bernie Ecclestone.

Formula One’s long-term goal is to have 24-25 races – up from the present 21 – and arrange them in three geographical segments: Asia, Europe and the Americas. Bratches said the Europe-based races would stay in middle of the calendar, with Asia or the Americas opening or ending the season.

He said their positioning had not been decided, and getting this done will be slowed by current contracts that mandate specific places on the calendar for several races. This means eventually that all the races in Asia would be run together, as would races in Europe and the Americas.

The F1 schedule is now an inefficient jumble, allowing Bratches to take a good-natured poke at how the sport was run under Ecclestone.

“We’ve acquired an undermanaged asset that’s 67-years-old, but effectively a start-up,” Bratches said.

Early-season races in Australia and China this year were conducted either side of a trip to Bahrain in the Middle East. Late in the season Formula One returns to Asia with races in Japan and Singapore.

The Canadian GP this season is run in the middle of the European swing, separated by four months from the other races in the Americas – the United States, Mexico and Brazil. These three are followed by the season-ending race in Abu Dhabi, which means another trip across the globe.

“With the right economics, with the right structure and cadence of events across territories, 24 or 25 is probably where we’d like to be from a longer-term standpoint,” Bratches said.

Big changes are not likely to happen until the 2020 season ends. This is when many current rules and contracts expire as F1’s new owners try to redistribute some income to allow smaller teams to compete.

“There’s more interest than we have capacity in the schedule,” Bratches said, firing off Berlin, Paris or London as potentially attractive venues. “We want to be very selective.”

“Those cites from an economic impact standpoint would find us value, as do others around the world,” Bratches added. “It’s very important for us as we move forward to go to locations that are a credit to the Formula One brand.”

An expanded schedule would have to be approved by the teams, which will be stretched by the travel and the wear-and-tear on their crews. The burden will fall on the smaller teams, which have significantly smaller revenue compared with Ferrari, Mercedes or Red Bull.

Bratches also envisions another race in the U.S., joining the United States Grand Prix held annually in Austin, Texas. A street race in Miami is a strong candidate, as are possible venues like Las Vegas or New York.

“We see the United States and China as countries that could support two races,” he said.

Liberty Media has reported Formula One’s total annual revenue at $1.8 billion, generated by fees paid by promoters, broadcast rights, advertising and sponsorship. Race promotion fees also tend to be higher in Asia, which makes the area attractive – along with a largely untapped fan base.

In a four-year cycle, F1 generates more revenue than FIFA or the International Olympic Committee, which rely almost entirely on one-time showcase events.

Reports suggest Vietnamese promoters may pay between $50-60 million annually as a race fee, with those fees paid by the government. Bratches said 19 of 21 Formula One races are supported by government payments.

“The race promotion fee being derived from the government … is a model that has worked historically,” Bratches said.