Of all the things Formula One owner Liberty Media might have been anticipating as it looked to overhaul the series’ digital strategy, a global pandemic was unlikely to have been on the list.
While it is unrealistic to assume that the global motorsport series – or any sport for that matter – should have been properly prepared for something as unprecedented as coronavirus, the health crisis has left Formula One facing a season like never before on and off the track.
A reduced season behind closed doors runs the very real risk of stagnating the digital growth Liberty has worked so arduously to achieve as part of broader efforts to attract younger fans. Since 2017, 62 per cent of Formula One's new followers have been under the age of 35, while last year page views on the series’ core digital platforms soared 82.3 per cent to surpass one billion.
There will be hopes that the rescheduled 2020 season can quash any fears of lost momentum. Be that as it may, and in keeping with Covid-19’s impact on the sports industry, this remains a critical moment in Formula One’s digital journey as it strives to make up lost time for a campaign that should have started some 16 weeks ago.
In a bid to plug the live content gap, the Virtual Grand Prix Series has proved a standout. Its run pulled in 21.8 million views on digital platforms alone, as well as 695 million impressions across social and 85 million video content views. Formula One’s real-life drivers also helped reach an additional 2.7 million viewers by streaming themselves racing on Twitch.
For Frank Arthofer, Formula One’s global head of digital and licensing, those esports events have helped continue the series’ efforts to attract a new generation of fan that had been left untapped by the sport’s previous owners.
Speaking to SportsPro ahead of this weekend’s season-opening Austrian Grand Prix, Arthofer previews Formula One’s revised digital plans for the new season, and discusses how lockdown has uncovered new learnings that can be applied for 2020 and further into the future.
How do you look back on the success of the Virtual Grand Prix Series and what ideas has it given you going forward?
Clearly it's engaged audiences across core fans and our core broadcast partners. ESPN, Sky Sports, Fox Sports have all taken it across the world and made it available in the markets where they're partners of ours. So that’s been good commercially, but it’s been good from a core fan opportunity point of view. Then [there is] the crossover potential there with the gamer fan and the younger fan, and perhaps more endemic gaming audiences but not so much F1 audiences.
The way that we stood it up was different than we typically do. For us, we launched that series basically on the back of a tweet of someone suggesting if Australia is cancelled we should run a virtual Grand Prix series. That tweet came through the week of Australia and by Sunday we had announced the Virtual Grand Prix Series. It wasn’t perfect the first race, the broadcast wasn’t perfect, there were a couple of technical glitches. But I think, ultimately, three months later we got to a much better place because we were willing to try something on the fly and iterate as we went.
There’s a really interesting media opportunity there. If you think in particular about the drivers and some of the dialogue that they had with one another during the races, [such as] trash talking or Lando Norris finishes a race, picks up the phone and calls Max Verstappen and spends a couple of minutes on a live phone call, with Max getting tips on how he could've run the race better in front of his entire Twitch audience.
That doesn't happen in real racing for a myriad of reasons, all of which are good ones. But I think there’s a takeaway for the real race around how we provide more access in our broadcast to fans to what’s happening behind the scenes. Also, how do we lean into that in virtual racing to make the programme and the production more compelling and deliver the biggest audience as possible? That’s probably the stuff that will inform our decision-making going forward.
What were some of the other things you did digitally to keep fans engaged during lockdown?
The great thing about sport - and you see this in the data across every sport - is you have built-in tentpoles, which are the games and, in our case, the races. That advantage is actually profound in sports where there’s a level of scarcity. You don't have 160 baseball games a year, 55 soccer games a year. You have 20ish Grands Prix a year, so 20 times a year you have a real tentpole that’s built in.
The first question for us was is there a way to replicate those tentpoles and build around that? The way we did that was first [with] virtual Grands Prix. Secondly, [it was] taking some of our best classic races that lived pretty much exclusively on F1 TV, our OTT (over-the-top) product and make some of those available to a broader audience across our social channels and digital channels like F1.com.
What we saw was the ability to build those tentpoles [which] gave us an opportunity to aggregate those spikes in audiences, not at the same degree as we would under a regular race, and build programming on the back of it. Those two elements have been really important to continue to build a programming strategy and fan engagement across our channels. As a result, we’ve seen really robust performance, again not necessarily at the same level you would see during a regular race weekend.
The other space we've been spending a lot of time is how do we build a platform to do good? That engages fans in a lot of ways but, more importantly, it’s about what our ethos is as a sport. We announced We Race as One. That’s something that was being worked on well before Covid and well before the Black Lives Matter movement, but [it] has been accelerated as a result of the public demand for businesses to take a view as to what they stand for in an environment that requires you to have a perspective.
Charles Leclerc wins on his Virtual Grand Prix debut! ��— Sky Sports (@SkySports) April 5, 2020
Dominant drive from the 22-year-old ��
Watch the highlights of the #VirtualGP
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Has it started to feel like things are getting back to normal with the return of live races? What’s the transition back to that been like?
I wouldn’t say it's been normal. I don't know that’s even the right way to think about it. What I do think is exciting is the suspense, excitement and hope that comes from the beginning of the season will be present for our fans, and that’s going to be really exciting for the business right now.
While I don’t think things will, as I said, get back to normal, I also hope it will be a very competitive season on track. We’ve certainly taken a lot of steps to make the sport more competitive as we’ve looked forward to 2021. So, all the good we’ve done from the beginning of quarantine with Drive to Survive and virtual Grands Prix, hopefully the platforms we’ve started with We Race as One, will extend to new fans who will try F1 for the first time this year.
It’s our sincere hope and belief that ultimately the core product - and competitive and exciting racing - is the key to our long-term success first and foremost. I think that’ll solidify the new fans that we've started to acquire to the sport and that will put us in a great place as we get to an even more competitive product hopefully next year.
F1 will be running a remote TV production for the first time at a Grand Prix this weekend
How are restrictions going to affect you as a digital team in terms of the number of people you have on site and working remotely?
We’ve cut down the team. We’ll be running a remote production for the first time in a real race in the history of the sport on the TV side. You won't see Will Buxton [Formula One’s digital presenter] with his arm around drivers when he’s doing interviews.
It will definitely change but it also gives us an opportunity. Are there ways to take what we learned from the virtual Grands Prix and provide more behind the scenes access to teams? Can we have an inside the garage camera view that we can make available on the TV? Can we mic up a team principal and get an insight into the conversations he or she is having during the race we can make available after the race on digital or through TV production and through our broadcasters?
There are a lot of innovation opportunities that come from the situation, so it’s not all about limiting what we do, it’s also about changing what we do. Some of that we won’t do in the first race because it’s important to get it right. It’s important to evaluate risk and make sure that we limit it where we can. But once we get more comfortable producing races in the environment we’ll start to test and try new things.
How do you assess the progress of Formula One’s digital operation so far and how much is there still to do?
I think we’re still in the early stages. We said it was a five-year plan and then you remember that in digital you can only plan three years ahead. So, I’d say we've made a lot of progress in three years but we’ve got another five-year plan in front of us, and three years from now we’ll probably have a five-year plan in front of us then.
We’re very proud of the audience growth and we’re very proud of the commercial growth, whether that’s direct revenues through our subscription [or] advertising business, or indirect revenues through our branded content strategy with sponsors through our ability to build licensing businesses in a material way that weren’t that large at the time. That could be through video game sales or F1 Store, which has been growing at a rapid pace, and the digital media business has been growing alongside it.
Going forward, there’s clearly a lot more we can do. On F1 TV we have an opportunity to tell more stories now that we have a more stable technical platform that really goes deep inside the sport, and we know that’s an avid fanbase. Equally, as we think about distribution, there’s probably more we can do with F1 TV alongside our core broadcasters. We announced that in the Sky Germany deal we’ll work together on F1 TV, and I think that may serve as a template for additional markets going forward.
Despite the delayed season, Arthofer is expecting continued audience growth on F1’s digital channels
Clearly, we’re in the early stages of our social growth still even though we’ve grown at such a massive rate over the last three years, and our engagement is quite high.
But on the commercial side, how do we continue to be leading in the marketplace from a branded content perspective and a storytelling perspective? How do we work with our sponsors to ensure that there’s no better place to go for Formula One storytelling than Formula One if you’re a sponsor for the sport? AWS [Amazon Web Services] insights work across TV and digital as a great example of that. What we do with DHL around fastest pitstop, which is compelling content but also very resonant to their brand equity as the best and fastest innovation logistics provider in the world, is very relevant. How do we do more of that? Gaming is [also] a big opportunity to grow in the media space.
One I would probably be remiss if I didn’t mention is original content. We’ve grown massively in the SVOD [subscription video on demand] and OTT space through the success of Drive to Survive, and that’s a hit-driven business. You have a hit like that and it creates a lot of opportunities on the back of that.
Equally, our podcast business is in a similar position. F1’s Beyond The Grid podcast I think is the single biggest motorsport podcast in the marketplace. Clearly, there’s a big market there. Podcasting has become more competitive and certainly original content has become more competitive. Those areas feel really rich as opportunities to develop. All of them present ways for us to engage and grow the sport.
Speaking of Netflix and Drive to Survive, what’s the latest on season three?
I don’t have an update formally on season three. I will only say that, as I said, original content is largely a hit-driven business and that show seems to have really found a big audience on Netflix. I’m optimistic that we’ll find a path to continue to produce it together and continue to see the audience grow as it has.
How have you had to revise your digital targets for this season?
We set targets both for reach and engagement. All the commercial opportunities typically fall out of that, whether that’s churn reduction on F1 TV or advertising sales growth. We have had a chance to step back and look at those and create more modest targets, as we have as a business at large.
But, for us, growth is the key and I think we'll anticipate and expect to continue to see our audience grow on our digital channels, and continue to see higher engagement per fan that spends time with us. That second metric is most important. If you find the fans are really engaging with and interacting with the content you’re producing, that’s a really good indicator of ‘are you making content that resonates with your core fanbase?’. If we can see that engagement metric go up, whether that’s liking, sharing or commenting on a post on social, or passing along or talking about a new series on F1 TV on the Reddit community, for example.
If we see those two things continue to grow then we’ll feel enthusiastic and positive about the work that we’re doing this year during a very difficult time in sport.