Fixing IndyCar: an introduction
IndyCar, IndyCar commentary — By Steph Wallcraft on November 27, 2012 11:30 amLast week, I painted a fairly grim picture of IndyCar’s immediate future.
As promised at the end of that article, I sat down over the weekend to start hammering out some thoughts on what IndyCar needs to change to bring itself away from the brink and turn things around.
But I ran into a snag: when I started making notes, I found that I was writing… and writing… and writing. By the time I was done, there was far too much content to cram into a single article.
So, instead, my humble list of suggestions for how IndyCar can improve itself has turned into a multi-part series.
Over the next couple of weeks, I’ll take a deep dive (ahem) into number of areas in which IndyCar could make significant improvements — many of them simple and inexpensive to implement — that would improve the health of the IndyCar Series both with immediate effect and for the longer term.
Here’s a preview of the topics I plan to cover in the coming days.
– IndyCar needs to heal its identity crisis and carve out its own relevance in the sphere of motorsport worldwide. When I envision asking people within the organization why IndyCar exists, I have a hard time coming up with what the response would be. That shouldn’t be the case. IndyCar needs to know and be clear about how it defines itself before it can successfully sell itself to others.
– IndyCar needs to find a permanent resolution for its internal politics. The self-centered in-fighting that has defined open-wheel racing for the past 30+ years must be brought to an end through any means necessary. It’s been allowed to create diversions and impede progress for far, far too long.
– IndyCar needs to turn its drivers into heroes again. In an age where death on a racetrack is no longer deemed an acceptable by-product of the sport by the general population, this is no easy task. But it can be done. It just requires some fundamental paradigm shifting in the ways that certain things are approached.
– IndyCar needs to create an environment that allows casual fans to get more emotionally invested. Currently, emotional investment from fans is more often met with annoyance than appreciation. A closer look at what drives fan interest might help to change some philosophies and approaches within the organization.
– IndyCar needs to do a better job of doing right by the fans it already has. There are some corners of the paddock that do an excellent job of being open and engaging with the existing fan base, but there are others that constantly get it wrong. A few very simple changes could get things moving in the right direction.
– IndyCar needs to know how to measure progress and identify that these goals are being attained. More butts in the seats and in front of TVs is the obvious desired outcome, but there are other, smaller measures that can be used as checkpoints as well. Identifying how to know that these changes are working is key to maintaining focus.
By the end of this series, my hope is that people on both sides of the fence will have considered and openly discussed some of the positives and negatives, the celebrations and frustrations, that have brought IndyCar to the state it’s in today and how they can be set right to allow for future growth.
***
Before diving into all of that, though, I’d like to take a moment to flesh out in more detail exactly why what happens now is so critical in deciding the future of IndyCar.
After all, people have been predicting IndyCar’s demise in every off-season in recent memory, right? What makes this year any different?
There are a couple of things.
For one, 2012 was meant to be IndyCar’s breakthrough year — the year that the new car was going to change the face of the Series and bring it roaring back into the public consciousness.
And there’s no question that the racing was significantly better this season than it has been in IndyCar in years.
But the disappointing attendance numbers, the dropped race in China, and the disastrous television ratings (which, by the way, were reportedly down 27% this year over 2011 and a sobering 62% since 2008) tell the complete story: No one noticed.
Sponsors were signed on the promise that 2012 was going to be a year heralding change and growth. New events were wooed onto the schedule with it.
Now, with no promises left to be made, selling sponsors on where exactly their return on investment is and convincing tracks to spend millions of dollars on sanctioning fees is more difficult than it has ever been.
Meanwhile, IndyCar is too busy dealing with its Caesar and Brutus, he-said-she-said dramas to focus on how quickly the ship is taking on water.
But those who have been around for a while may find this to be the most distressing part of all: during The Split, all of the challenges and fears that saddled both sides always seemed slightly tempered by the fact that if one series were to fail then the other would be there to fall back on (as unappetizing as the notion may have seemed at the time).
Now, though, there’s no safety net. There’s nothing to fall back on. If this iteration of North American open-wheel racing fails, there’s a very real possibility that it will be the last. Sure, some owners might try to resurrect it, but at the current cost of running in IndyCar even the best-lined pockets will run dry eventually, and what sponsors would invest in a new series after the way the previous one was driven into the ground?
People who dismiss that notion or think that IndyCar is too big to fail are kidding themselves.
I’ve put together a rudimentary diagram to offer a basic demonstration of how cash flows within IndyCar.
This is highly distilled, but it works to prove the point. There are a lot of people who like to claim that the fans will always get the short end of the stick because they’re not where the bulk of the money comes from. The sponsors write the checks to the teams and the tracks write the checks to IndyCar, and that’s where the majority of the income that keeps the series running is found.
The problem is that if there are not enough fans supporting the Series to justify the money the sponsors and tracks are spending — i.e., if they’re not gaining attention and earning profit from their participation — then those entities no longer have a reason to give those bigger checks to the teams and Series to keep the whole thing going.
Everything in any sport — everything — starts with earning fans and keeping them engaged and happy. And that fact was lost in IndyCar long ago.
We’re well past the point of rallying the troops. There simply aren’t enough of us left who have stuck it out. Word-of-mouth is a great tool in plum times, but that yellow section in that diagram up there is laughably small right now. That group needs to get a lot bigger fast, and grassroots tell-your-friends movements are no longer going to cut it.
2013 may not be the final year of IndyCar, but it’s not at all unreasonable to suggest that the state of the sport by the end of 2013 will decide whether IndyCar ultimately lives or dies.
The changes that need to happen within IndyCar right now need to come from within. And the best way that the fans who are left can help make that happen is to generate ideas and hope they permeate the walls at 16th and Georgetown well enough to make a difference.
I certainly don’t claim to have all the answers, but if I can contribute one or two ideas and help to generate some more then the exercise will have been worthwhile. I hope you’ll join me in the discussion as I present the first of those ideas later this week.
Tags: Verizon IndyCar Series - Administration
This is the deep-dive we all want to see! Can’t wait to see your thoughts going forward, Steph.
My first event at IMS was in 1952 & as you can imagine im a life long fan. There are more than enough reasons to go around why Indy car racing is no longer popular & also more than enough blame but to state the obvious. The schedule is scatered about so much that the series has no identity. Look at NASCAR.Racing every week on a fixed schedule that is televised. They replaced any intrest in auto racing with the general public. Championship open wheel racing has for most of its 100 plus years in the US has been a ninch sport. By & large it has been supported by folks that had the welth to fund teams. Although there have been times when there was great changes in the technical side it usually reverted quickly to every one running a spec car & engine. Why would fans who watched open wheel racing for most of there life be interested in a North American open wheel series that featured special cars & engines built in other countries, running tires & accsesories made outside the US, & most of the drivers & mechanics are from other countries? And of course the very biggest reason (combine all of the above) it is not supported as a sport on network TV. Everyone that is in any way part of NASCAR when they speak the first words are almost always ( our sport). Even at my age 74 ill make several visits out to the track in May & watch the race with my son & many friends & hope that it will always be there in that wonderful month of May. Bill Wallace Cloverdale Indiana.
I’ve always contended that racing’s true stars are the CARS. Automotive racing’s origins helped innovate and improve vehicles in numerous ways.
Drivers we admired because they were doing something few could or would do (dare to pilot these extreme machines). Crews and engineers developed ways to outsmart the competition with innovation.
When the car ceased being the star, fans went away. I’d argue that relative to most motorsports, N-car fans have a higher than average connection to the driver, but a significant number of fans also went away at a time which coincides with the arrival of the bland COT, likewise in Indycar.
Point being, the Indycar drivers, short of putting on circus-like or pro-rasslin’ style entertainment, also need to be associated with innovative cars from a variety of suppliers and manufacturers. The time for using the ‘poor economy’ argument against more open car specs is fallacious.
Cost-containment is understandable, but neutering and homogenizing cars in the name of cost-cutting is exactly the opposite of what fans watched on TV and paid money to see in person.
Make the cars awesome and intriguing and varied and you’ll have plenty of fans again.
TV ratings. You could ignore everything else. Every seat for every race could be filled and it won’t be enough to make IndyCar a top tier, profitable business until there are millions watching each race on TV. Everything has to be evaluated by how it will impact TV ratings.
I’m not suggesting that everything else should be ignored, just saying that TV ratings result in the big money. I would also argue that an increased number of TV viewers will benefit ticket sales much more than increased ticket sales will benefit TV ratings.
So it’s simple, but it’s not easy.
First, limiting your TV audience by being broadcast on a channel that’s not part of the basic cable package is a big obstacle. That contract may make everything else moot. What could be more counterproductive than knowingly preventing interested viewers from seeing your broadcast.
Second, the story of eace race has to be presented properly. This is a big thing. If the viewer isn’t made aware of the nuances of the race, then you can’t capture their interest. You have to make people want to know more than just the outcome. They have to feel like they are in the middle of it actually happening. I would make the NBCSN IndyCar broadcast team and production crew watch every F1 race presented by Varsha, Hobbs, Matchett, and Buxton for the past year, maybe more. Plus steal every whizbang gadget on the screen. Scoring pylon, telemetry, radio transmissions, all of it. Tweak to fit IndyCar.
That’s just a couple of obvious things. I know there are plenty of others as you mentioned.
I’m not convinced that the drop in TV ratings is relevant to the discussion, especially when you have a series with so much international interest. It comes as no surprise that losing Dancia hurt the ratings considerably; ESPN used to claim that their viewership polls indicated a full HALF of their viewers in 2010 were watching because of Danica.
What are F1 rating in the US? Does anyone know, or care? Certainly they are low, but that did not preclude the $400M investment (if you believe the numbers) in building a new track and infrastructure.
Of course, the loss of Dan Wheldon, who was going to be the replacement as face of the IndyCar series, hurt dramatically in the overall marketing effort, as well as having a major effect on the relationship with IZOD as title sponsor.
That said, it always appears that IndyCar as a series never has a Plan B. “What if the ratings suck after we signed a long-term deal?” should have been asked in 2008 or 2009, not now.
The big thing is to create and leverage on the possible B2B relationships among sponsors so that money flows into the sport, using the APEX Brazil program as a template series-wide.
Make it mandatory for teams to employ a sponsor rep full-time, and host sponsor summits, even if just meet and greets with drivers, at each event. It is far easier to re-up and keep happy an existing sponsor than find a new one. Somehow this lesson has never been utilized by IndyCar as a whole, and some teams do a better job than others (Andretti comes to mind here.)
Going further, require teams to act like teams, and care about something other than themselves and making money. Everybody would be better off.
I very much look foward to the rest of your thoughts in the coming weeks. I agree with a lot of what you said, and I can’t wait to join in on the rest of the discussion.
In order to gain fans, IndyCar needs to make sure the ones they have are kept happy. If IndyCar is unwilling to put out a large marketing strategy, their current fans are the best shot they have to increase fan numbers.
I know I was personally unhappy with the decision to keep Dallara, and solely Dallara as car manufacture. I think more emphasis needs to be placed on automotive ingenuity and advancement. And like you said, the drivers need to be made hereos again. I think pushing the ladder system could help with that, at least with getting more American talent in the series.
As a college student studying business and looking for a career in sports, I am always on the lookout for people to make into new fans and new ideas to help the growth of the series. I know I do not have all the answers and I will never claim to. I just want to do all I can to help the sport I love survive.
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Nice article, but there is a flaw (of sorts) in your cash flow diagram: while there is a direct and precisely quantifiable flow of cash from fans to the tracks, which entirely determines the profitability of the event., the same realtionship does not exist between fans and sponsors.
For the sponsors, it is the *perception* of ROI that determines the level of their investment in Indycar – but unlike ticket sales for tracks, there is no precise metric for sponsor ROI.TV ratings are only a rough measure because there are other opportunities for ROI, like the impact of Indycar images in advertising outside of the Indycar race broadcasts.
But it is true that falling ratings are generally bad for sponsorship.
Thanks very much for your input.
I disagree with your assessment, though. The entire point of a sponsor bringing money into IndyCar, for any reason and no matter what other benefits may be had, is to increase its income. Target doesn’t sponsor two teams because its executives like shaking hands in corporate suites and using pictures of IndyCars in its advertising. The company expects its involvement in IndyCar to result in more people entering its stores and spending money there. Any attempt to claim otherwise is obfuscating the very basic purpose of sponsorship.
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