43 replies to this topic

[wj_gibson]

Having read the silly season thread and several of the comments comparing Marcus Ericsson to Pedro Diniz as mediocre talents that have been able to stick around the F1 fraternity for far longer than really justifiable because of the sponsor money they bring, a question struck me.

*Why* do the likes of Diniz and Ericsson attract sponsorship to the industrial scale that they do when dozens of more naturally gifted drivers fail to do so? What is actually in it for their sponsors to be seen backing someone held in low esteem? What actual reward do they get? They must get something, but why are they not transferring that sponsorship to, say, a Robin Frijns or someone like that? Genuinely curious to know.

[RedBaron]

It's often family money and family connections that bring the money to these drivers.

 

Pretty sure Diniz Father was well off. Carma Jorda for example her Father's a big deal in Santander.

[DeKnyff]

I imagine the first reason is a personal and/or a long-time relationship with sponsors. Or sponsors who want a driver of a given nationality, or a given profile.

[BullHead]

Yeah, it's who a driver knows, through family or whatever. They've still got to be good though. Maybe not comparitively good to others in the field, but good nonetheless. A super licence is needed, and a bad reputation is not good for anybody's investment.
It's the same throughout all levels of motorsport.

[Imateria]

If I remember right Diniz family owned a supermarket chain so thats where his money came from.

[Marklar]

-Rich Family
-Nationality(eg Maldonado and PDVSA)
-personal (business) relationships (isnt vdG sponsor his father in law?)

[Talisman]

If I remember right Diniz family owned a supermarket chain so thats where his money came from.

One of Brazil's largest chains iirc. I remember his father seriously considered buying and taking over prost or arrows. Have to say that after his years in f1 diniz was alright as a driver.

I suspect that many sponsors are linked through family beginning in childhood and the relative lack of talent only becomes apparent too late to abandon them ie at gp2 or f1 level.

Edited by Talisman, 23 July 2015 - 20:30.

[redreni]

Another way of looking at this question - why don't the best drivers attract the big sponsorship money - is to realise that they do.

 

I very much doubt any of the "pay drivers" running towards the back end of the grid get more than a tiny fraction of the backing a driver like Hamilton or Alonso get. The difference is, top drivers get to strike a deal with the team that allows the sponsor's logos to go on the car and on the team gear, without necessarily having to let the team take 100% of the sponsor's cash. And the top drivers normally get paid more than what the sponsorship they bring is worth to the team.

[TurnOffTheLights]

Diniz was sponsored by Parmalat, an Italian food corporation, that has been in Formula 1 sponsoring before:

http://www.grandprix...e/spon-008.html

Not sure, how much influence Diniz' father had on this deal (probably a lot), but Parmalat followed Diniz every time he changed teams.

 

It must be said, I highly doubt Ericsson will achieve anything near to what Diniz has done in his Formula 1 career. There have been far worse drivers than him.

 

In his rookie season 1995 Diniz managed to beat his teammate Roberto Moreno. With today's points system it would have been 10:0 in points!

Edited by TurnOffTheLights, 23 July 2015 - 20:41.

[DeKnyff]

Another way of looking at this question - why don't the best drivers attract the big sponsorship money - is to realise that they do.

 

I very much doubt any of the "pay drivers" running towards the back end of the grid get more than a tiny fraction of the backing a driver like Hamilton or Alonso get. The difference is, top drivers get to strike a deal with the team that allows the sponsor's logos to go on the car and on the team gear, without necessarily having to let the team take 100% of the sponsor's cash. And the top drivers normally get paid more than what the sponsorship they bring is worth to the team.

 

I think the big question is why THE SPORT does not attract big money. If there was plenty of sponsoring funds, the best drivers would automatically attract it, just like in football Barça, Bayern or Chelsea attract the richest companies. Just my opinion, of course.

[BoozeBaron]

Most comments above are spot-on and nail it (impressive) ... Wealthy families with strong ties are the most common reason and the answer -

 

FWIW - We sponser a (nameless) series with a kiwi driver who came to the table with NZD$10M - I'll confess if I have 2 quasi-equal drivers sitting in front of me - and one is asking for millions, and the other is offering... (again, close to being equal in talent) - It's a no-brainer, of course we're gonna take the cash ... especially these days, when finding sponsors and funding is so very difficult ... I suppose in thinking about it more - it applies to all segments of life really - not just racing... which is why I admire those that come from nothing that have now 'made it' ... (Though I do think PM has wrecked more in parts over the years than he's brought to the table;))

 

OFF TOPIC - but just saw that Lotus dodged a bullet by finally paying off their gearbox supplier - and makes me wonder if they ever paid Kimi in full for the year he left 2 races early to have back surgery? Wasn't it like £12M owed? Hmmmm ....

[Nathan]

What I remember of Diniz is in exchange for sponsoring his son, Parmalat, Arisco etc. received better product placement in the family grocery stores, more promotions etc..  You scratch my back, I scratch yours.

The Ericsson one puzzles me.

[Marklar]

Ericsson is apparentely sponsored by private persons from tetra pak and h&m. Both swedish companys who are supporting the only driver who has a chance to drive in F1. Nothing special. What puzzles me is that they are making such a big secret of it but didnt even take advantage of it with having some stickers on the car. Thats strange.

Edited by Marklar, 24 July 2015 - 04:10.

[FerrariV12]

Yeah Ericsson had two separate sponsors on his cars in the 2 years I watched GP2 with him in it, then since joining F1 a completely different company "Silanna" has appeared on the Caterham and Sauber he has driven. No idea of the connection and to be honest it requires a Google search for me to know what these companies are.

 

At least Nasr's deal seems to make more sense, for all the "pay driver" comments he's probably the best Brazilian driver outside of Massa already in F1, and the Brazilian IndyCar veterans who will probably see out their careers in that series, being sponsored by a company whose name translates to "Bank of Brazil", perfectly logical.

 

Same with Maldonado, for all his flaws he's the best Venezuelan driver out there and being is bankrolled by "Petroleum of Venezuela Ltd."

 

As an aside I remember when Enrique Bernoldi back in 2001 and (Klien at Jaguar come to think of it) was branded as a "pay driver", when really he was the predecessor of Vettel and co. except that Red Bull didn't own their own team at that point.

[Prost1997T]

Unfortunately even Nascar is starting to see a rise in pay drivers and those with family connections\wealth. Motorsport is one of the more expensive competitions you can participate in, and there's not as much traditional sponsorship as there used to be.

[proviz]

Once again, the money behind Ericsson is not tied to any businesses at all. It´s private money that comes from a member of the Rausing family (of Tetra-Pak fame) and it's use is totally down to the whims of that individual.

Ericssons and Rausings are not related and there's no history between the families that anyone seems to know about.

The only apparent motive behind throwing all that money at Marcus is to have a Swede in F1. I cannot recall another case like it. Well, at least not on the same scale. 

[BlinkyMcSquinty]

One aspect many fans ignore is that drivers must understand the business side of life and how it relates to their careers. The good ones seek out and cultivate good relationships with companies, and they also deliver a return for the investment by the sponsor. Irrespective of their on-track performance, if they deliver a return that makes the sponsor happy, then their careers blossom because they are attractive to sponsors and bring in the money.

 

 

One good example is Mike Skinner who enjoyed a career in NASCAR. His best finish was 10th for a 22 year career. Yet he drove one of the best cars in one of the best teams. Sponsors loved him.

[noikeee]

A potentially relevant Wikipedia article: https://en.wikipedia...oney_laundering

[BullHead]

One aspect many fans ignore is that drivers must understand the business side of life and how it relates to their careers. The good ones seek out and cultivate good relationships with companies, and they also deliver a return for the investment by the sponsor. Irrespective of their on-track performance, if they deliver a return that makes the sponsor happy, then their careers blossom because they are attractive to sponsors and bring in the money.

 

 

One good example is Mike Skinner who enjoyed a career in NASCAR. His best finish was 10th for a 22 year career. Yet he drove one of the best cars in one of the best teams. Sponsors loved him.

 

Absolutely. It's part of the sport. A driver has to have the talent to shine on the track and the talent to find the right audience for backing.

Drivers get successful by being businessmen.  There's a lot of luck when it comes to backing, but there's also a lot of hard work to be in that lottery draw in the first place.

[TimRTC]

The first things that a lot of young drivers have to do, is find sponsorship. Most driver training these days includes elements of PR, marketability etc. Those who sit and moan on twitter etc. about not being able to get a drive are often the ones who are hoping that someone will just sign them up with a million pound contract.

 

See David Coulthard on Formula Ford:

 

 

However, this is not limited to motorsports. The vast majority of sportsmen and women these days have to look for sponsorship or have wealthy parents - professional level sports gear, travelling to events and training camps etc. all adds up. Not to the same level as for a prospective racing driver who has to pay these sort of fees plus the actual running fees of the car, but still far more than an average wage family could cover alone.

 

http://trackandfield...-field-athlete/

[Mohican]

This "pay driver" debate is tedious. F1 cars are driven by very good drivers, but F1 is the ultimate equipment sport - without a good car you do not win. Full stop.

Of course there are third party financial contributions to the teams, there always have been. Whether these are tied to the presence of a specific element - driver, branding, colour schemes, locations - varies, but the fundamentals apply.
OK, so Ericsson would not be driving in F1 without sponsorship. Nor would his teammate Felipe Nasr.

Nor would Sergio Perez, Pastor Maldonado and Romain Grosjean (Total) just to mention a few. In the cases of the Red Bull teams and Force Indianit must be understood that the teams are owned outright by the sponsors and the drivers are simply employees.

Again, outside F1 this is so obvious as to never be questioned. Every GP2 team requires funding to run their drivers, simply because they are commercial operations. Nothing strange in that. Many people on this forum write about for instance Williams as "true racers" or similar. Fine, but do you seriously believe that Williams - and all other teams - do not need to make a profit ? That team is as much a commercial entity as Sauber or any other.

At a tangent, it is very interesting to see that 10% of Ferrari is being sold on the NYSE; people tend to overlook that this will require much clearer accounting, public reports, etc, etc which will make Ferrari's F1 finances better understood by the rest of us - which should be interesting.

[proviz]

This "pay driver" debate is tedious. F1 cars are driven by very good drivers, but F1 is the ultimate equipment sport - without a good car you do not win. Full stop.

Of course there are third party financial contributions to the teams, there always have been. Whether these are tied to the presence of a specific element - driver, branding, colour schemes, locations - varies, but the fundamentals apply.
OK, so Ericsson would not be driving in F1 without sponsorship. Nor would his teammate Felipe Nasr.

Nor would Sergio Perez, Pastor Maldonado and Romain Grosjean (Total) just to mention a few. In the cases of the Red Bull teams and Force Indianit must be understood that the teams are owned outright by the sponsors and the drivers are simply employees.

Again, outside F1 this is so obvious as to never be questioned. Every GP2 team requires funding to run their drivers, simply because they are commercial operations. Nothing strange in that. Many people on this forum write about for instance Williams as "true racers" or similar. Fine, but do you seriously believe that Williams - and all other teams - do not need to make a profit ? That team is as much a commercial entity as Sauber or any other.

At a tangent, it is very interesting to see that 10% of Ferrari is being sold on the NYSE; people tend to overlook that this will require much clearer accounting, public reports, etc, etc which will make Ferrari's F1 finances better understood by the rest of us - which should be interesting.

 

None of this changes the fact that Ericsson's backing is entirely different in nature to the vast majority of sponsorship arrangements. Who else has been receiving an unconditional annual donation in the region of 15-20 million euros just to drive in F1? No requirement of publicity or b2b benefits, probably not even dependent on level of achievement.

[sopa]

I agree that some of the backing of truly underwhelming drivers are a mystery. Some drivers, i.e Sakon Yamamoto, who had the ability to pop up here and there for years without showing any performance for it!

 

But as mentioned, the issue is that even though world is one and F1 seems global, there are lots of regional criterias to take into account. Only very few companies are of truly global reach, i.e Philip Morris or Red Bull, who would also hire drivers based on talent. Or should I say, they are not tied to regional interests as much as many other companies, even if marketing is still important for them.

 

Other drivers however, even if we consider them average and almost non-existent from our point of view, could be significant names in the area, where they come from and/or where their company does most of the marketing. If a driver is a sole representative from a country (in this case Maldonado, Ericsson) it is not even that important that they do not have results. Company can show to compatriots that "look we have supported OUR (meaning from our nation) driver all the way to F1".

 

The business interests of those, who perform direct nepotism, i.e the van der Gardes, Pics and Chiltons of this world, are more vague. I am unsure how much marketing benefit they get from it, especially when the driver in question is not the key competitor from the country (Chilton, Pic here). But still - the companies may feel they need a public face they can rely on, and using a driver/person, who they have known basically from his childhood, is a comfortable way of doing it. In this case driver doesn't need to be a superstar, they can just show that "we have also supported a driver in F1, among other activities".

 

Bottom line is... I think it is not a secret that at least some of the marketing budget of big companies can easily disappear in a way that no-one is quite sure about the benefits. Money laundering, corruption, whatever.

Edited by sopa, 25 July 2015 - 09:18.

[Talisman]

I agree that some of the backing of truly underwhelming drivers are a mystery. Some drivers, i.e Sakon Yamamoto, who had the ability to pop up here and there for years without showing any performance for it!

But as mentioned, the issue is that even though world is one and F1 seems global, there are lots of regional criterias to take into account. Only very few companies are of truly global reach, i.e Philip Morris or Red Bull, who would also hire drivers based on talent. Or should I say, they are not tied to regional interests as much as many other companies, even if marketing is still important for them.

Other drivers however, even if we consider them average and almost non-existent from our point of view, could be significant names in the area, where they come from and/or where their company does most of the marketing. If a driver is a sole representative from a country (in this case Maldonado, Ericsson) it is not even that important that they do not have results. Company can show to compatriots that "look we have supported OUR (meaning from our nation) driver all the way to F1".

The business interests of those, who perform direct nepotism, i.e the van der Gardes, Pics and Chiltons of this world, are more vague. I am unsure how much marketing benefit they get from it, especially when the driver in question is not the key competitor from the country (Chilton, Pic here). But still - the companies may feel they need a public face they can rely on, and using a driver/person, who they have known basically from his childhood, is a comfortable way of doing it. In this case driver doesn't need to be a superstar, they can just show that "we have also supported a driver in F1, among other activities".

Bottom line is... I think it is not a secret that at least some of the marketing budget of big companies can easily disappear in a way that no-one is quite sure about the benefits. Money laundering, corruption, whatever.

Advertising costs can be offset against tax, therefore you don't have to go as far as criminal activity to justify the costs. I can fully understand what chilton's father gets from sponsoring his son through his own insurance company.

[MortenF1]

Yeah, Ericssons arrangement is pretty unique, as has been mentioned - in that his backers don't demand ANY visibility in return! Which is strange, owners(?) of Tetra Pak as rumour has it. Have also heard that the guy(s) behind H&M chips in.

 

On Diniz, he was far better than many gave him credit for, and Ericsson does not deserve to be mentioned together with him. Diniz was hot and cold, but could, on his best days, beat Damon Hill and Jean Alesi for instance.

[proviz]

I cannot see what good all that secrecy does for Ericsson's cause. If anything, it makes the whole set-up smell decidedly fishy.

If a private person pays that much to buy a seat for his protege in F1, why does he want to shy away from being seen as a benefactor to Swedish motor sport? An intriguing aside is how all the people in the know, journalists included, have been sworn to secrecy. And there's more: like Ericsson is not even supposed to have a "manager", Eje Elgh always referred to as just an "advisor". The boy could never ever handle his own business affairs.

[Mohican]

Why is Ericsson a pay driver but Nasr not ? Makes no sense at all.
And btw, Ericsson has now outqualified Nasr in three out of the last four races.

[chrisPB15]

Speaking of rich families, how many people here were given a racing Kart for Xmas as a little kid?

 

Senna was gifted a Kart and his parents had the land to drive it on. Mansell was gifted a Kart and parents had the land. Those two were always considered 'poorer' drivers. 

Hamilton was also gifted a very expensive Kart package aged 8.

 

Coulthard's dad owned a haulage company and could afford to keep all of his son's racing cars. Button was gifted a quad bike as a little kid and then a Kart. Button sold himself to hard investors as a last resort and now has to share his salary.

 

All Formula One drivers have enjoyed advantages other potentially more talented kids wouldn't get access to.

 

Having said that, they all had dedicated parents, to the extreme. Even the pay drivers.  You can't begrudge dedicated parents and good nurturing. The majority of mine and friend's parents couldn't be bothered to watch us play football.

Edited by chrisPB15, 25 July 2015 - 16:08.

[Myrvold]

Speaking of rich families, how many people here were given a racing Kart for Xmas as a little kid?

 

*raises hand*
Or, not for Xmas, but my parents bought a racing kart for me when I was 10 (couldn't start earlier in Norway).

My divorced parents, who did not have a new partner, my dad, a car mechanic, my mom without education, working her way up to working in the office at a foundry. They weren't rich at all, but I was spoiled, or they had a feeling of guilt because of the divorce and me being an only child. I "moved" between them every week. So the week I wasn't at my dad's. He didn't do much other than work, sleep and eat. While my mom, she dropped dinner quite a few times when I wasn't at home, just to save money.

My grandparents on both sides also helped out a bit with my karting.

 

The point I am trying to make, is that you don't have to be rich to get a racing kart, you will most likely be a bit spoiled, but you don't have to come from a rich family

[proviz]

Why is Ericsson a pay driver but Nasr not ? Makes no sense at all.
And btw, Ericsson has now outqualified Nasr in three out of the last four races.

 

Not much sense in trying to feed logic to blinkered fans, I guess, but for the sake of making things absolutely clear, let's make the distinction:

-Nasr's sponsor gets blanket exposure on the cars. Publicity, presumably worth something, so the arrangement can be seen as a fairly conventional commercial link.

-Ericsson's backer gets nothing tangible in return at all. From the driver, that is; of course the team has to seat said driver in one of their cars, but what measurable benefit does that bring to the backer? So, in effect, Marcus Ericsson is a paydriver in the most purified sense of the word. There has not been another like him for a long, long time. Quite extraordinary! And worth more attention than it has been getting.

[Mohican]

Why should Ericsson's backers have any obligation to report to you ? And why should you have any right to know what their motivations are ? "Measurable benefit" ? What is that to you ? You are being very arrogant in demanding answers like that.

If Ericsson has managed to attract backing to fulfil his dream, all credit to him. Some drivers do, others don't. Making it in motor racing is down to a lot of factors, not least being successful in attracting support. This has always been the case.

Diniz has been mentioned - Guy Edwards, Brett Lunger and Harald Ertl are other and perhaps better examples since they were active already 40 years ago. They did not set the world alight, but we're able to make it to F1 due to being good both in and out of the cockpit.

[Talisman]

Why should Ericsson's backers have any obligation to report to you ? And why should you have any right to know what their motivations are ? "Measurable benefit" ? What is that to you ? You are being very arrogant in demanding answers like that.

If Ericsson has managed to attract backing to fulfil his dream, all credit to him. Some drivers do, others don't. Making it in motor racing is down to a lot of factors, not least being successful in attracting support. This has always been the case.

Diniz has been mentioned - Guy Edwards, Brett Lunger and Harald Ertl are other and perhaps better examples since they were active already 40 years ago. They did not set the world alight, but we're able to make it to F1 due to being good both in and out of the cockpit.

 

Why the defensiveness?

 

I think its natural to express curiosity as to why Ericsson's backers have put a lot of money into his career with no exposure.  It isn't common to say the least to not use driver sponsorship to promote a company or product and this is something that usually comes with significant tax benefits.  It appears as if Ericsson's backers only receive the satisfaction of watching his career grow with no other tangible benefit.  It is unique IIRC.

[TheRacingElf]

Speaking of rich families, how many people here were given a racing Kart for Xmas as a little kid?

 

Here another rich kid haha

 

No I got a kart, in fact several karts from my parents but I don't consider my family particularly rich. But as an only child I maybe was a bit spoiled though

But i get what you're saying, you don't need to be rich to buy a kart but you have to be when you want to race with it. Most of the "poorer" F1 drivers had parents who already had a bit more money than average Joe. For a real middle class kid it's almost impossible to build a racing career, karting is already too expensive to start with

[midgrid]

Senna was gifted a Kart and his parents had the land to drive it on. Mansell was gifted a Kart and parents had the land. Those two were always considered 'poorer' drivers. 

Since when?  It's well-known that Senna was from a wealthy family, and the Mansells were also decently off until Nigel mortgaged his house later on.

[KnucklesAgain]

Lauda was a pay driver.

[Jimisgod]

Why the defensiveness?

 

I think its natural to express curiosity as to why Ericsson's backers have put a lot of money into his career with no exposure.  It isn't common to say the least to not use driver sponsorship to promote a company or product and this is something that usually comes with significant tax benefits.  It appears as if Ericsson's backers only receive the satisfaction of watching his career grow with no other tangible benefit.  It is unique IIRC.

 

Yeah, pretty much every other sponsorship con be explained by some combination of 1. talent, 2. family connections, or 3. nationality - which all adds up to exposure for the sponsor. I suppose you could argue Ericsson satisfies 1. and 3. but his sponsors seem to want the opposite of exposure. Maybe he's a secret love child or something.

[TimRTC]

I find it amusing when people rag on 'paydrivers' in modern motorsports, then go and watch historics racing which is 90% wealthy businessmen and 10% friends of wealthy businessmen too old to drive.

 

F1, NASCAR, DTM, LMP1 and Formula E are pretty much the only paying seats in motorracing at present and you can be damn sure no-one got to those seats without paying to drive in smaller classes earlier.

[Fisico54]

I find it amusing when people rag on 'paydrivers' in modern motorsports, then go and watch historics racing which is 90% wealthy businessmen and 10% friends of wealthy businessmen too old to drive.

F1, NASCAR, DTM, LMP1 and Formula E are pretty much the only paying seats in motorracing at present and you can be damn sure no-one got to those seats without paying to drive in smaller classes earlier.

+ indycar, lower WEC classes works cars, WTCC, national touring car series, several lower 'stock' series in the US plus various Japanese series.

[Fisico54]

I find it amusing when people rag on 'paydrivers' in modern motorsports, then go and watch historics racing which is 90% wealthy businessmen and 10% friends of wealthy businessmen too old to drive.

F1, NASCAR, DTM, LMP1 and Formula E are pretty much the only paying seats in motorracing at present and you can be damn sure no-one got to those seats without paying to drive in smaller classes earlier.

+ indycar, lower WEC classes works cars, WTCC, national touring car series, several lower 'stock' series in the US plus various Japanese series.

[Ross Stonefeld]

Since when?  It's well-known that Senna was from a wealthy family, and the Mansells were also decently off until Nigel mortgaged his house later on.

 

I know it was a *completely* different time period, but does anyone else laugh at the idea of being young enough to race but also having a house that you can mortage to pay for it?

[ninetyzero]

I know it was a *completely* different time period, but does anyone else laugh at the idea of being young enough to race but also having a house that you can mortage to pay for it?

 

(Off topic)House prices weren't completely ridiculous back then, people could actually afford to buy them...

[Heisenberg]

No one made it to F1 exclusively because of their natural driving abilities, but I think that the problem people have with drivers like Maldonado, Ericsson and such is that they do not deliver. Had Pastor Maldonado been THE NEXT BEST THING I think that these discussions would not take place any longer, but he is dreadful to be honest! However, the thing is, these drivers simply do not go, because the team needs money. In a normal world, Maldonado would have already been fired, a couple of years ago...

Edited by Heisenberg, 28 July 2015 - 20:06.

[Risil]

(Off topic)House prices weren't completely ridiculous back then, people could actually afford to buy them...

 

It still happens in the parts of the country that aren't the south. (Off topic)

Edited by Risil, 28 July 2015 - 20:32.

[Ross Stonefeld]

Look forward to seeing you on BTCC weekends in 2016 in a Formula 4 car.