Social Spotlight with Formula One’s Frank Arthofer

Each week, I ask a member of the racing community to share their thoughts on social media. This week: Frank Arthofer, the global head of digital and new business for Formula One.

I noticed you came on board in June. As you get started here, what are some of the immediate challenges that you want to tackle, and what do you see as something you want to steer toward improvement?

As you know, and as our fans most importantly know, we’re not really engaged in making a big investment in the digital space to serve fans. I think our platform is a little bit dated in terms of and the F1 app. We have a team of — you wouldn’t believe it — less than five who are running all the content on our website and our app. We hasn’t participated in the fantasy gaming space at all.

So there is I think a lot of opportunity to deliver an experience to fans that makes us a core part of the way they interact with this sport and the digital space. That certainly exists on our own platforms, and even moreso probably on the social media space. So to me, that’s probably the biggest opportunity: Just investing to drive engagement and ensuring that when fans wake up every morning and Formula One is an important part of their life, that we’re a part of that life and we’re making it better.

So you come in and see these areas of need. Where do you even start? You don’t have huge staff and you don’t have all these things. What do you decide to tackle first?

I guess you sort of start with what your North Star is, which is I guess a strategy question. I’ve spent a dozen years in media tech, sports and entertainment, and for me, it’s going and looking at the big governing bodies who do this really well — the NBA is a great example — and kind of understanding what it is that makes them great.

Do they act as a media company and try to cover the sport somewhat independently as an example? Are they invested deeply in the platform and the technology side of the house to ensure that they’re personalizing and experience to fans, serving up the right content at the right time to the right people? So that’s kind of where we started. What are the people who do this best doing, and what are the common elements that we want to try and take and make exist in the Formula One world?

People in the F1 world, from what I understand, have gotten used to doing things a certain way for a long time. Did you meet any sort of resistance when you want to change this, or say “I’d like to do this, we want to improve this?”

Yes and no. I would say that all the incumbent staff who are in place in Formula One, almost to a man and woman has embraced changed in a material way. So internally, I think there has been very little resistance to it and, in fact, most of our best people have been waiting for this moment.

I think the challenge is in changing perceptions outside of Formula One, our relationship with teams and drivers. I think we’re slowly but surely working to build a more collaborative one. I think certain sponsors, probably in the old world of Formula One, wouldn’t have been interested in participating in the sport given some of the challenges in terms of the way it was operated. I think now it’s sort of moved to where actually we can be leading.

The brand is really strong and improving; we’re one of the most technologically sophisticated sports in the world, which really helps us given the way the market’s moving. So I think it’s more about the external educating process. And the most important of those constituents are the fans, and they too are rightly a little skeptical when we say, “Hey, we’re gonna invest in a big way in making great digital content.” Because we haven’t really done that for them at the league level — teams more so (have invested) than we have in some cases — for decades. But I think we’re cracking away at that foundation across the board.

In the NASCAR world, it seems like people are fans of certain drivers, but overall they’re fans of the sport. I don’t know how that compares to F1, but how do you present content to your audience with that in mind?

I think we’ve done a really good job building our foundations of being fun, being interesting, providing fans unique access on social. But I do think there are two things that make our sport unique and are both an opportunity and a challenge.

The first is the global nature. After the NBA, we have the second most fans of any annual global sporting event in the world. And if you take the U.S. out, we’re bigger than the NBA. So if you look at it through that lens, that’s a great opportunity — but it also means you need to be relevant to different tastes, different cultures around the world. And I think that’s something that we need to start to bring a little bit more to the way that we program and develop and deliver content on social.

The second piece is we have largely a very unique and exclusive rights position, particularly as it relates to what happens on the track, and we work closely with our broadcast partners to ensure that they have de facto exclusivity aside from us in most markets. I don’t think we’ve done a good enough job of taking advantage of that, frankly — that opportunity that exists from a video rights perspective. If we’re the only place aside from broadcast partners in the market where you can go and get great data around the race that’s live or get the official highlight at the end of the race that’s immediately available — which we are — I think that’s a really great unique selling proposition for fans. It’s a reason for us to be a part of their daily or weekly cadence with the sport, and we haven’t really elevated that enough. So I think that’s probably the second opportunity or challenge that we’re faced with.

I read your bio and it seems like you’ve done a lot in the OTT space, which is “Over the Top” streaming content. How do you see that evolving for the future? All of our habits are changing so rapidly.

Well certainly it’s obviously disrupting the media business in a material way, no more so than here in the U.S. as we sit in the Austin Grand Prix in the Haas tent. But I think for us as a sports right holder, it probably more than anything presents an opportunity, right? There’s more competition in the market for rights, which is a good thing. I think there’s more ways to reach fans through the Internet, which is a good thing, particularly in markets where cable TV isn’t as mature. And I think it presents an opportunity for us to go direct to consumer and build a subscription service that for our hardest-core fans who will always be the most important to us, super-serves them, and deepens their experience in relationship to the sport and with Formula One. (Note: F1 is planning to launch a subscription streaming service.)

Where is this all going? Are we even going to be watching TV as we know it in 10 or 15 years from now?

We’re getting into a philosophical conversation about the future of TV now. How much time do you have? (Smiles) Yeah. People will continue to watch TV. I think it’s an impossible question to answer because it’s so broad, right? Video viewing time is going up, so the value of premium video content will, in my mind, continue to grow. The ways people watch it, the devices on which they watch it, the ability for advertisers to reach consumers in the way that they’ve always done is going to change.

If you take advertising as an example, you’re gonna see more and more branded content on TV. It’s become the ad sales “soup of the day” from a digital content perspective. There’s not any big RFPs (requests for proposals) in the market nowadays that don’t come with some kind of branded content element that’s editorially authentic to the fan but also integrates the brand in a way that makes sense. You’re going to see that on TV, it’s not always going to be 15-to-30-second TV spots for two minutes every 10 minutes. And that’s the break in the content.

So we’ll see that in other spaces for sure, but I think it’s all sort of rooted in the notion that if you offer a premier piece of content, people are going to care about it and continue to watch it. Technology is unlocking more ways to consume it rather than disrupting that in a material way.

Do you have a sense for what kind of content F1 fans like? And I’m asking this from a place of pure ignorance. Are F1 fans in general more into the technical aspects of it, where they love the telemetry and the data? Do they want driver interviews? What does well for you guys?

So not all fans are the same, obviously, and I think it depends on what platform you’re on. Social, by nature, is going to be a broader platform, and you need to appeal to a wider set of tastes. Then your own platforms are, by nature, going to be a slightly smaller group of people as you’re further down the funnel. And as you go even further, the subscription products, you’re even further down the funnel and you have an even smaller audience base.

So I think the hardest-core fans that are the least price sensitive who want to spend more time and money with Formula One are going to be the ones that understand every element of the sport deeply. They want the (NBA writer) Zach Lowe-style piece for Formula One — statistically driven, really data driven, almost like I’m in the strategy room making the decisions around the car and how it gets set up.

And on social, I think access … to some of the lighter elements of the sport. We like to say we take F1 seriously, but we don’t take ourselves seriously. I think that’s probably a space that appeals to a broader range of people and can be kind of viral and shareable. That’s fun. We want to be fun on that platform and it’s required, because we’ve got 15 million followers on social versus a million or so that use our platforms on a weekly basis. It’s just a different group.

In the NASCAR world, the drivers have sort of been conditioned to play along with social and be really a big part of that. How willing are the F1 drivers to accommodate the requests you guys have if you have a pitch for them? Are they in that mode yet, or do they have more work to do to get there?

I would say at the moment, we don’t pitch to drivers directly because we try to build that relationship with teams. I will say that there are a lot of drivers who want to work directly with Formula One and sort of see the direction we’re taking in terms of investing in capabilities, investing creatively and editorially in this sport. And I think equally there are teams who support that, too, and kind of look at it as, “Hey, if F1 can help us grow this sport, that’s a good thing for everybody.” It’s not so much, “We have to grow the Red Bull team only,” or the Ferrari team only.

I guess the short answer is varying degrees. But I think most have kind of come around to the notion of social media presence, digital presence, direct relationships, interactions with fans. It’s pretty much net positive from everybody, from a commercial perspective, from a sport perspective and from a brand perspective — even if your brand is Daniel Ricciardo. So I don’t think there’s a lot of education to do; it’s more about finding the right operating model to work together on it.

I know the hot topic around here, or at least I’ve heard about it this weekend, is what F1 can do to get it more relevant in the United States. It seems like a long road, since motorsports in general is struggling at times in the United States, NASCAR included. Is there anything from a digital standpoint that you guys see that can help, or is it something that is going take time?

It’s funny, I was walking around Austin yesterday and I saw so many F1 shirts and hats. I heard people talking about it. I heard store owners commenting on how busy they were because F1 was in town. So it feels to me like Austin’s pretty healthy. I know that the sales have been incredible this week.

But yeah, obviously we’re not in the zeitgeist in the same way that other major sports are, and the same way that, frankly, we are in most other countries in the world. I think digital will help and the presence of OTT will help. I think our ESPN relationship will help, as that’s always been a great platform for growing sports. And I think in general, the presence of social media and the investment we’re making in that space, given how mature that is in the states, should help, too.

So I think it’s a lot of things. It’s not one silver bullet, it’s more like a collection of a lot of small initiatives that will hopefully lift this sport. I mean, it is the greatest racing spectacle in the world, so I think it’s more about getting fans to try and understand it than it is about really anything else. So we’ve gotta do a good job there.

What else do you want people to know about the efforts that you guys are doing that you just want to pull out there? Do you have a message to your fans?

Continue to give us feedback from a fan perspective. We look at Reddit every day and we see the fan forums, so it’s helpful to know how everybody feels about it. And then I should also plug the Susan G. Komen Foundation; obviously we’re going pink this week in Austin and it’s a really important initiative for us in Formula One, and it’s near and dear to my heart, actually. So those are the two big messages, I’d leave you with.