Sean Bratches, Formula One’s managing director of commercial operations, might not quite be sport’s Michael Corleone but he admits that, after calling time on his 27-year career with broadcasting giant ESPN in 2015: “I thought I was out – until they dragged me back in.”
The smile Bratches wears as he says this reveals there is no ambiguity to his remark. Having overseen ESPN’s growth from a single channel to a global juggernaut, pioneering high-definition broadcasting and crafting its cable and satellite distribution network in his stay of more than a quarter of a century with the company, no one could have held it against Bratches when he headed for a well-deserved retirement.
That retirement ultimately lasted less than two years. In early 2017, Bratches was coaxed back to work by new Formula One Group chief executive Chase Carey after the completion of Liberty Media’s takeover of motorsport’s elite series. He would not have returned, he says, for anything other than a project of this magnitude.
“Now, I feel like a puppy!” he adds. “My tail’s always wagging, I’m smiling the entire time.”
Bratches certainly does not come across as the kind of character who would settle down into a retirement of leisure – although he is, reportedly, a skilled woodworker in his spare time, he appears to thrive off the energy and bustle of the sports industry. “I feel like a shark here,” he says. “If I stop swimming I’m gonna die – there’s just so much to do.”
*****
Bratches, pictured here at a Lagardere Sports event in Shanghai, says China is a priority for the sport
Liberty has now been in control of Formula One for ten months, and it’s hard to imagine a more hectic environment in the world of sport to come back into. Talking about the process that brought him into the Liberty fold, Bratches jokingly describes it as a “classic bait and switch,” in an anecdote that tidily illustrates the scale of the job before him.
“I was approached to come over and run the business group,” he explains, speaking to SportsPro in Shanghai in August. “And then I got here, and there was no business group! There was no marketing team, or digital team, or communications, or research. Nothing.
“So I’ve been in the process of hiring the leads of each of those respective groups. I spent the first three or four months effectively by myself before people starting coming on board. I was just rolling a grenade into every room I went into because there was nothing in the pipeline. There were no deals pending or anything.”
Much of what Liberty found after finally completing its takeover of the sport in early 2017 was in a similar state, with rumours suggesting that former chief executive Bernie Ecclestone’s grip over Formula One Management had become so dominant that nothing could be done without his say so – meaning, in effect, that very little got done at all.
I feel like a shark here. If I stop swimming I’m gonna die – there’s just so much to do.
Formula One was hardly falling into disrepair – global audiences were still impressive and, as the size of Liberty’s US$8 billion buy-out would attest, it was still a huge generator of revenue – but a sense of stasis had permeated the sport for a number of years, with many modern, and even some not-so modern, innovations passing Formula One by.
It is instructive, for instance, to note that at the time of Liberty’s takeover, the official MotoGP account had almost the same number of followers on Twitter as that of Formula One. It is not to denigrate two-wheeled racing to suggest that such a situation was not reflective of the two series’ wider overall popularity. Social media, says Bratches, is something the new owner has “put its shoulder behind” significantly, issuing new guidance to teams, drivers, sponsors and race promoters on developing the sport’s digital offering.
Bratches emphasises that he is not here to compare and contrast the two different ways of working – “I didn’t work under the Bernie regime, and I don’t really have a lot of context for the way things were run,” he says – but it is nevertheless apparent that Liberty has taken a revolutionary approach to its start at Formula One, rather than an evolutionary one.
“I think we’ve already demonstrated things that are representative of the new way of thinking,” he says. “We did an event in London where we raced cars up and down Whitehall, we had Bastille, Little Mix and Kaiser Chiefs, sponsor activation, fan elements, show cars. I’ve got a tender out to seven different firms to create fan experiences, fan festivals in city centres in proximity to Grands Prix next year.”
That, Bratches says, is a “total reinvention of the fan experience at Grands Prix,” which previously were focused on the hardcore Formula One fans who were turning up to races just to see the racing. “Reinvention” is a word that comes up frequently while talking with Bratches. So, too, is “fan” – but it is quickly apparent that the fans being courted by Liberty are a much broader, more diverse group than the petrolheads who were the bread and butter of the previous regime.
“We’re trying to put more water in the ocean to rise all tides in an effort to create a better fan experience at these events, whether it’s in the fan festival area, the public area, in the paddock, in the paddock club or if it’s on the grid,” Bratches says. “We’re doing substantive things in all of those areas to bolster the fan experience.”
*****
Bratches says Formula One needs to become “an entertainment company as much as a sporting one”, with concerts and other events forming part of the experience
All of this is in service of Liberty’s ultimate task, which is, in Bratches’ words, “trying to pivot this from purely a motorsport company to a marketing and entertainment company”.
The way there, he says, will be through “massively improved digital engagement”.
“We’re certainly going to emphasise the linear business in terms of broadcast and we’re going to make that better,” he adds. “We’re going to produce it better than it’s ever been produced before, really show the speeds, the sounds, the wheel-to-wheel racing, what people are really, really interested in. But at the same time, the digital side is really interesting to us.
“We have an RFP [request for proposal] in the marketplace right now to create a live and non-live over-the-top [OTT] product and to better utilise the data and metrics that come out of each race. There are 1,500 points of data that come out of each of these cars every second of a Grand Prix. We’re not going to suffocate the fan but we want to identify a substantive amount of those metrics that we can convert the ones and zeroes into very compelling user interfaces to tell our story, to engage fans, to take the non-fan to the casual level, and the casual fan to the avid level.
“We need to fight in the weight class that we should be in, which we’re not at now.”
Aside from Bratches, one of the men most responsible for getting the sport into its rightful place is Frank Arthofer, another ESPN alumnus who was named Formula One’s global head of digital and new business in May.
Speaking to SportsPro at August’s Black Book Motorsport Forum in London, Arthofer notes that getting digital engagement right is crucial to the future flourishing of the sport, and to that transformation into an entertainment company as much as a motorsport one.
I spent the first three or four months effectively by myself before people starting coming on board. I was just rolling a grenade into every room I went into because there was nothing in the pipeline. There were no deals pending or anything.
Although there are an estimated 470 million Formula One fans of some description worldwide, he says, “there is a significant subset of those fans who are incredibly avid and passionate about the sport, and they haven’t had access to historical Grands Prix in the past. There’s an opportunity to serve that up and meet that unmet demand through digital engagement.
“Generally in digital we’ve all, to a man, said we need to make an investment there because these things take time and resources,” continues Arthofer. “The PGA Tour, Nascar, other sports in America that are similarly positioned – they have dozens and dozens of products in tech and a whole team of editorial people. We’re going to outsource some of the technology development because we think there’s great partners who can help us build it, but we also need to have a really small but really effective internal editorial team to help us grow.”
The benefit of coming into an organisation so under-developed digitally is that there is still plenty of “low-hanging fruit”, adds Arthofer, with opportunities and challenges presenting themselves equally as he and his team attempt to enact a digital makeover not just for the benefit of Formula One itself, but all of its stakeholders.
He explains that it is as much about making sure the little things are done – things which may appear obvious at first glance, but which until now have lacked strong implementation.
“We need to work more collaboratively with the teams – it starts with them, because there are certainly a lot of fans who love the drivers but there’s a lot of fans who love the teams, too – and we’re working on that,” he says. “There’s little things, like allowing them to film at the event for social media platforms, letting them share their own content instead of keeping them on a leash. And there’s bigger things that we’re talking about as well.
“Our sponsors, who haven’t really been able to activate digitally in the past, are champing at the bit for this, so it’s first and foremost about how we activate them and grow those relationships and deliver high ROI for them and for us. Longer-term, we want to grow our sponsor relationships, too, and I think having bigger and better digital assets will help us do that.”
Frank Arthofer, Formula One’s global head of digital and new business, speaking at the Black Book Motorsport Forum
Long-term thinking, however, is proving a problem in a fast-paced world in which Formula One is already starting from the back of the grid.
“We have a modest and profitable business in the near term,” says Arthofer. “Long-term, how far can you really plan in the digital media world? A couple of years at this point? So we’re focused on getting a great product out in front of the fans who have been asking us for it, and then converting some of those fans to subscribers.
“Part of the challenge and the opportunity is that also yields a global fanbase. In the world today that’s a great thing; you want to have a global fanbase. Marketers, brands, media companies, they all want to be global and we already are. On the flipside, it means you have to serve different audiences in different languages with different kinds of content and product experiences. That’s the part that I have to figure out, and our broadcast partners have to figure out, and our production team has to figure out.”
That Arthofer and Bratches both have significant backgrounds in the world of broadcasting is clearly no coincidence, and is indicative of where Liberty is hoping to see the biggest return on its investment. The TV product was already Formula One’s strongest asset, but there are those in the motorsport world who feel that it has been held back and, despite the vast amounts of cash already pumped into the sport by broadcasters, see it as an area due for major growth.
“I’ve got a lot of top priorities,” jokes Bratches, “but that is clearly my top, top priority. It’s on the top of the list. There are huge opportunities on the broadcasting and production side to move this to be a more 21st century display of our brand and of our content, and I agree with those who say that fans are expecting more.”
Turn the channel to any other sporting event, he says, and you’ll see an example of something Formula One could be doing better than it currently is or an idea that could be implemented in the world of high-speed racing. The ongoing shake-up of the broadcast world – with innovations like over-the-top (OTT) and direct-to-consumer platforms changing the way rights are sold, and virtual and augmented reality set to transform how sports are consumed – is again a hindrance to long-term planning, but that is more a cause for excitement than negativity, says Bratches.
Arthofer says the first step in the digital revolution at Formula One is to work more closely with the teams themselves
“We are encouraged about the future of the display of our content on television,” he says, “but clearly this is a sector that is undergoing rapid transformation. We need to try and strike a balance, particularly with regards to OTT platforms.
“We’re in a window right now where I don’t think it would be prudent that we went 100 per cent pay. From a brand standpoint, we need and are desirous of a free-to-air component to each of the packages that we do. As we look at the pay marketplace we’re going to have to assess how our OTT plans fall in line.
“We’ve got a pretty significant amount of the global population that doesn’t have television, either for economic reasons or, in the case of a younger generation of fans, philosophical ones. We want to serve all fans, and have a voice out there, so we have a pretty good vision in terms of how a live and non-live direct-to-consumer platform could work in concert with our incumbent partners today and tomorrow. That’s a big priority to us because it’s a substantive amount of our revenue stream and it’s a consumer touchpoint that we want to amplify, not do anything to degrade. We’re excited about that opportunity and, as technology unfolds, I think the consumer ends up being the winner.”
Arthofer adds that the strategy for both the short and long term is to “always work with broadcast partners”.
“They’re great at what they do, and they have massive distribution outlets that we can’t hope to match,” he says. “I come from ESPN and I believe in the future of ESPN, and I believe in the future of media brands and broadcast partners, but I think it’s more about changing incrementally than cannibalism. It’s about: how do we add value to the ecosystem and add value to fans rather than how do we take share from the broadcast partners? We want to support them and just as we’re going to do more with the promoters and sponsors, we want to do more with the broadcast partners as well.”
*****
Max Verstappen and Lewis Hamilton duke it out in the 2017 Malaysian Grand Prix, the last in the country under the current deal
In the course of each conversation, both Bratches and Arthofer refer to Formula One as having a “startup feel”, which is not just a hat-tip to current marketing vogue. Despite, as Bratches points out, “having a global brand, half a billion fans and a strong financial balance sheet,” it feels like a legitimate way to look at a project which, in many ways, is starting from the ground up as a modern sporting institution.
“I don’t know that there’s too many opportunities like this in the world of sport on a global basis,” adds Bratches. “At the beginning, we were spending a lot of time trying to flesh out what were the key ideas and what we should put our shoulder behind and trying to create a strategic plan and a vision for going forward. We’re trying to evolve this from a very deal-oriented transactional business to one that is I think much longer-term thinking, much more strategic decision and planning-oriented.”
We need to fight in the weight class that we should be in, which we’re not at now.
Investments are going into every sector of the business to ensure it is firing on all cylinders, including a series of well-overdue brand and audience studies. “We’re not going to be a company where research makes decisions,” says Bratches, “but it’s going to ultimately inform better decision-making as we go forward and I think there’s a lot of business aspects of Formula One that were developed that we’re trying to evolve and improve upon.”
That, in turn, will help to exploit those opportunities that had “laid fallow” under the previous ownership.
“We’re really starting to build from the ground up and, brass tacks, the plan is working,” says Bratches. “Every Grand Prix this year has had significant increases in ticket sales, other than the British Grand Prix. Television ratings are up globally, our digital numbers are through the roof, we’re above any major global sport and I will say that we started down here but we’re growing faster in 2017 in the digital world than any other sport.
“We’re encouraged by the early signs, there’s a lot of work to do, but I think we’re encouraged by the immediate metrics that have come out of it and we feel very supported by the Formula One community, including the fans, but also the promoters, the sponsors, the teams, our media rights holders – they’re all very encouraged in terms of what we see and how we’re activating in trying to detonate this brand.”
Bratches, for one, is glad he was dragged back in. With time, all of Formula One should be, too.
This article originally appeared in issue 96 of SportsPro Magazine. To find out more or to subscribe, click here.