IndyCar Series and Indianapolis Motor Speedway and TV Ratings and Communications and Media & Marketing and Sports Business

Critics push IndyCar chief to shift focus to driver development

February 1, 2014
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There’s no disputing that Hulman & Co. CEO Mark Miles has added horsepower to the IndyCar Series and Indianapolis Motor Speedway in his first year on the job.

In 2013, Miles secured $100 million in tax revenue over 20 years from the state to make upgrades at the track; overhauled management ranks; and retooled the IndyCar schedule, including May at the Brickyard.

But there are grumblings Miles has not focused enough on the products that literally drive the series—the drivers themselves.

Motorsports observers including analyst Derek Daly say Miles—who led Indy’s 2012 Super Bowl Host Committee after a stint at the helm of professional tennis—needs to focus on raising driver profiles and on training and recruiting more top-flight Americans.

Mark Miles Miles

“[IndyCar officials] are focusing on the symptoms and not the problems,” said Daly, a former open-wheel racer who maintains a home base of Indianapolis. “The symptoms are, nobody shows up at the races and no one watches on television. The problem is, no one cares. So why does no one care? Because there’s nothing to engage them. The drivers are the key components to engaging fans.”

Miles is asking for a little patience, but makes no apologies for his approach. He has promised to focus this year on marketing and promoting drivers.

“We had to get the building blocks in place,” he said. “We felt we had to get the organization aligned.”

New title sponsor?

Miles is “very optimistic” he will have a deal signed for a series title sponsor to replace Izod by the first race March 30, as well as several other “official” series sponsors.

“We’re having serious conversations with more than one prospect,” he said. “Any of the organizations we’re talking to would be instantly recognizable and have substantial advertising budgets.”

Though Miles would not comment on possible terms of a sponsorship deal, any agreement is likely to require promoting the series and its drivers.

Daly Daly

“[Sponsors’] ability to help us grow the sport, project the brand and enhance our fan experience is the highest priority,” he said. “The rights fee is secondary to that.”

The series, which hasn’t turned a profit since its 1996 inception, also plans to work with teams and drivers to formulate a “brand plan for each driver” that maps out how a driver should “be put forward by broadcasters, sponsors and other stakeholders.”

Retired racer and motorsports consultant Mario Andretti questions whether Miles’ moves have put IndyCar in a growth position.

Andretti criticized IndyCar officials for scheduling around the National Football League and college football, and called Miles’ idea of a more compact schedule—ending before Labor Day—“not plausible.” He said those moves will cost the series exposure and weaken it in the long run. He also criticized an idea Miles had floated to run non-points races on foreign soil during winter.

Miles told IBJ in January that he hopes eventually to bolster—not shorten—the schedule. He promised to lengthen the schedule to seven months by adding points races in February and March, possibly in South America, South Africa and the Middle East—a plan that supplants his earlier proposal for winter non-points races. Miles is optimistic the new races will be added to the 2015 schedule and will raise the profile of the series and its drivers in diverse and growing markets.

Some say the changes are coming too slowly.

“It’s a difficult balance [Miles] has tried to maintain,” said Ken Ungar, the former IMS chief of staff and IndyCar Series senior vice president before forming his own sports marketing consultancy, US Sports Advisors, in 2006. “A lot of the sport of auto racing is about the auto, but the fan connection is to the driver.”

American revolution

Critics like Andretti and Daly argue that Miles needs to raise the series’ “prestige level” to attract more and better U.S. drivers.

Andretti Andretti

The series “needs more American drivers to attract a bigger audience in the U.S. where it is based and most of its fans reside,” Daly said.

Daly, whose 22-year-old son, Conor, races in the Formula One feeder system and has dabbled in the IndyCar Series, said Miles needs to work with team owners to make sure development programs foster the next generation of American stars, and to ensure that at least some of them are drawn to IndyCar instead of NASCAR.

Daly insisted his complaints have nothing to do with gaining IndyCar opportunities for his son.

He’s concerned that the series instead is recycling older drivers such as Juan Pablo Montoya, a 38-year-old who will return this year to IndyCar after spending most of his prime in Formula One and NASCAR.

“Look at what F1 is doing,” Daly said. “They’re bringing in new, young stars, guys like Sebastian Vettel and Daniil Kvyat.”

The 26-year-old German-born Vettel and Kvyat, a 19-year-old Russian, have attracted huge followings for F1 in their home markets where that series races, Daly said, “and that’s what American drivers would do in America for IndyCar.”

Last year, IndyCar sold its top feeder series, Indy Lights, to promoter Dan Andersen, who is promising big improvements to the series, which last year featured minuscule fields.

Miles said creating opportunities for U.S. drivers should be “part of the mix” for IndyCar, but he’s not concerned by the lack of American drivers in the series, calling the current drivers “an incredibly attractive set of personalities.”

miles-factbox.gifDaly said Miles misses the bigger picture.

“The power of national pride in major sporting events is something Mark Miles doesn’t understand,” Daly said. “That’s what drives TV ratings for the Olympics. That’s why NBC will focus on Americans in the upcoming Winter Olympics. Until someone in IndyCar recognizes that, the series will drift wayward.”

Attendance, TV ratings sag

Critics point to the series’ attendance and TV ratings, which continue to decline. While IndyCar officials don’t divulge attendance figures, they admit there are too many empty seats.

 TV viewership numbers, generated by New York-based Nielsen Media Research, speak for themselves. The average Nielsen Co. rating for IndyCar races that aired on ABC declined from 1.34 in 2012 to 1.25 in 2013. Worse yet, the Indianapolis 500 was the only race that earned a rating over 1.0, which advertisers said is a key metric in selling spots. Even the 500 saw a rating decline from 4.34 in 2012 to 3.68 last year.

Series races on NBC Sports Network saw ratings drop from 0.29 in 2012 to 0.27 in 2013.

“I think that’s the biggest thing they could do to turn the series around,” said Zak Brown, founder of Zionsville-based Just Marketing International, which represents some of the world’s biggest motorsports sponsors. “To attract more advertisers and sponsors, they have to consistently hit that 1.0 TV rating threshold.”

The results the series is seeking could take up to three years, said C.J. O’Donnell, who worked in marketing for Ford Motor Co. for 20 years before joining Miles’ staff in November as IndyCar’s chief marketing officer.

O’Donnell admitted the Speedway and IndyCar Series have been hurt by “an inconsistent strategy in bringing our drivers forward.” Constant turnover in the marketing department, O’Donnell said, has added to the problem.

A number of current longtime and former IMS and IndyCar employees agree. Instead of focusing on driver promotion, IndyCar and IMS officials struck deals with former Kiss star Gene Simmons and John Mellencamp’s then-wife, Elaine Irwin Mellencamp.

“[Series executives] lost their way, plain and simple,” a former staffer said. “Now it’s up to Miles to put it back on track.”

Marketing IndyCar and the IMS, O’Donnell said, must include everyone involved in the series, from Speedway greeters and ticket takers to team owners and drivers. He’s promising to change IndyCar’s culture starting this year.

“In good time, I’m very confident we can make some good strides in attendance and TV ratings,” O’Donnell said. “It all starts with a consistent, long-term approach.”•


 

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