F1 scandals give sponsors cause for concern

Earlier this week, the sport’s governing body the FIA ruled that Renault conspired to cause a deliberate crash in order to fix the result of last year’s Grand Prix in Singapore, an offence, it says “of unparalleled severity”. Former team boss Flavio Briatore, who days earlier had resigned from his post, has also been barred from any involvement in FIA-sanctioned events indefinitely.

This latest controversy, dubbed “crashgate”, follows a tumultuous twelve months that has seen Honda and BMW exit the sport, eight top teams threaten a breakaway championship over plans to impose a controversial voluntary budget cap – a crisis since averted – and McLaren admitting to deliberately misleading a steward inquiry.

Many observers believe that such events have damaged the sport’s appeal to sponsors in the short-term.

Pete Davis, managing director of marketing opportunities website Getmemedia, says: “Sponsorship investment is under increased pressure in this market. Any sport looking for new sponsors or wanting to protect its current partnerships needs to be going the extra mile for its sponsors, not taking such a big step back. F1 must now work very hard to regain its credibility and trust.”

Jonathan Neill, sponsorship PR Director of Generate, agrees the job of attracting new sponsors could be more difficult in the short-term, particularly, he adds, at a time when the sport is looking at boosting revenues and reducing the “huge costs involved”.

“Existing brands will be questioning their associations and brands looking to enter the sponsorship marketplace will now have a big tick in one of their negative criteria boxes during their evaluation,” he says.

Pippa Collett, managing director of Sponsorship Consulting, says although from an ethical point of view brands could now think twice about associating with the sport, from a commercial point of view F1 remains a “powerhouse” in terms of offering brands global reach and experiential opportunities.

Spanish banking group Santander certainly recognises the value of association with the sport, extending its sponsorship of the McLaren F1 team and signing a five-year deal with rival Ferrari earlier this month.

The bank has credited the association, in particular the campaigns fronted by McLaren driver Lewis Hamilton, with increasing brand awareness in the UK from 20 to 82% recognition.

The sport will survive the mis-steps of some of its number, while new teams and sponsors will replace old. However, brands might be a little wary of potential skeletons in the sport’s cupboard.

As advised by the European Sponsorship Association this week, some might even include extra clauses in their contracts to provide them with additional protection against the crimes of the sponsored when signing any new partnership in any sport.