What your favorite celebrity didn't do for Formula E in India

The podium ceremony shot by Soumil Arora (IG - @iamsoumilaroraa)

Formula E’s India campaign was long overdue. This country has hosted International motorsport events in the past and has rich motorsport history, yet it has taken 10+ years to bring a major event back after Formula 1’s untimely contract termination in 2013.

With Formula E’s India-arrival announcement, an air of excitement rejuvenated the average motorsport fan in the country. Just over two months before the tentative ePrix date, the Indian Racing League [IRL] played the role of a test series for the new street circuit in Hyderabad, which despite its glitches, had done more than enough to convince the FIA bosses of a good spell for Formula E. A sense of surety seemed to be all it needed to kick off a short but high-budget marketing campaign to lure fans.

The promoters used a combination of conventional media strategies to advertise the event - social media engagement, a rather grandeur event at the Gateway of India, and a heavy focus on celebrity and influencer marketing - mostly those unrelated to the sport. Formula E certainly had the advantage being well positioned as an affordable series to catch live in comparison to other categories of motorsport — the tickets ranged from INR1,000 upwards to INR125,000, while the cheapest Formula 1 grand prix one could go to from India is upwards of INR20,000 for just the tickets.

Despite a few operational mishaps, the ePrix was generally a successful event, as evidenced by ticket sales, public perception, and sponsorship activation. However, a few conscious early interventions could have enhanced fan experience and even increased the lifetime value a fan can generate for the series.

To break it down, lifetime value or LTV for sport is the amount of “sales” that a fan can generate for a sport over a period of time. It is a rather long-term metric that might be difficult to quantify, but it can have a significant impact when used correctly. For example, an average FE fan in India might spend:

INR 5,000 - tickets

INR 2,000 - merchandise

INR 700 - concessions

A total of INR 7,700 for a good experience.

Imagine the fan committing to not just spending in India once, but more than once a year watching the sport in another country. Even better when the INR 7,700 is multiplied over a period of time consistently (depending on the sport’s contract in their country)

The cost of acquiring a fan through intensive marketing is quickly offset when Formula E’s product is of good quality, as it was this year in Hyderabad.

When marketing Formula E in India, the promoters chose the rather easy way: celebrity endorsements. When celebrities reach their fan bases, there is little effort made to sell the product, i.e., racing, and more importance given to selling their presence. In India, a country that is swayed by the influence of celebrities and internet influencers, it creates great potential for short-term revenue as ticket sales increase. However, the fans who might end up in the grandstands are a function of high marketing spend and the output is of one-time value generation, which is not ideal from an economic point of view.

To optimize costs for a championship like Formula E, marketing must be targeted towards fans that generate more than one-time revenue and amplify them over the years, in increasing value, and with consistency. It’s more likely to find such high-engagement fans in local WhatsApp groups, following popular sport-specific content creators, and in popular local motorsport cities like Bangalore, Chennai, and Kochi (and others). In perspective, a single motorsport content creator has the power to convert viewing fans to repeated paying fans, unlike celebrities, who convert casual sports viewers to one-time fans.

The reach of celebrities cannot be ignored when promoting sports of any kind, but the lack of targeting the right fans through the right channels can become a costly affair. For instance, the attendance of the Indian Grand Prix in 2011, with all its first-time buzz and marketing flair, resulted in 100,000+ tickets sold. However, only a fraction of those holders committed to watching the sport live through the years and even fewer new ones were added, which meant that only about 40,000 tickets were sold in its third run in 2013.

With Formula E filling in most of their allocated seats this weekend in Hyderabad through some phenomenal marketing through internet influencers and Bollywood power, promoters will undoubtedly be elated with the turnout for their very first run. But the series, I reckon, may have repeated the mistake F1 had made but in another avatar. That said, with the fantastic show that the promoters put on on Saturday, it might be helpful for them to dissect their nearly sold-out crowd and understand the repeatability of this current viewership in either viewing another race (in or out of India) and their sport consumption patterns for better marketing a potential 2024 race.