Ron Dennis: McLaren focused on long-term sponsor commitments over shorter F1 title deals
McLaren
Posted By: Alex Kalinauckas  |  23 Jun 2016   |  12:54 pm GMT  |  51 comments

Ron Dennis says the changing nature of Formula 1’s sponsorship models means his McLaren team has prioritised signing smaller deals for longer, rather than sell prominent space on its cars to a single company for a shorter period of time.

Dennis was speaking at the launch event of McLaren’s new partnership with fashion brand Michael Kors, which will become the team’s “lifestyle partner” and have its logos visible on the MP4-31 and the overalls of Fernando Alonso and Jenson Button.

“The sponsorship model changes year on year and for many years it was about a predominant brand on a Grand Prix car,” he said. “The activation budget needs to match the investment and the numbers in Formula 1 have gone up and up and up.

Jenson Button

“[When] you then start looking at funding and racing, it becomes so expensive that no one company can put it together. So what we’ve done over the years is go down the path of different types of comparable products that sit comfortably here with a common objective.

“We’ve been very much focused on brands and the long-term, rather than short term [as] a dominant force on the car.”

McLaren has been without a title sponsor since the end of 2013, when its deal with Vodafone expired, but the team has since signed a number of sponsorship deals without putting high profile branding on large sections of its cars, as was previously the case.

Jenson Button 2013

Dennis described how the team had decided to focus on reaching deals with brands that share its values and used the Michael Kors deal as an example of that process.

He said: “Our search for a fashion brand has been very much focused on a brand that lives by the same sort of brand principals and values as ourselves. It’s an honour to have Michael Kors on the car because of what it stands for.

“We have to under-promise and over deliver on our side of things and then the whole thing will just take on a natural scope.”

Fernando Alonso

Speaking about the deal, which his company is marking by releasing 50 limited-edition black leather jackets, Michael Kors said: “This partnership is about the convergence of style and speed, which is inherent to both the Michael Kors and McLaren-Honda DNA.

“There is an energy, sophistication and confidence to both of our brands, and we wanted to create a limited-edition piece that spoke to that.”

Lawrence Stroll, the father of Williams’ development driver Lance, floated the Michael Kors brand. Although he has now sold his stake in the company, the Canadian businessman now has links to three F1 teams, including Ferrari, which was sponsored by Tommy Hilfiger, another of Stroll’s business interests, during the Michael Schumacher era.

What do you make of Dennis’ comments? Leave your thoughts in the comment section below or head over to the JAonF1 Facebook page for more discussion.

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1

“Vodaphone”! Really, James!

2

I heard from well informed sources Ron Dennis is pondering a deal with Pfizer (the makers of Viagra) as the companies share the same values. However the stumbling block of the Viagra name appearing on the sidepods is the slogan due to be used Pfizer want ‘Viagra when things could be harder’ where as Ron has clearly stated things are already hard enough.

3

In the classic ‘rockumentary’ film ‘This is Spinal Tap’ the band’s manager is asked if the band’s popularity is on the wane he responds “Oh no not at all – its just that their appeal has become more selective!”. If Ron can’t currently attract brands with genuine tradition and timeless appeal then I suppose he has to look at Johnny-come-lately companies who at least have a bit of street cred but it’s not like the good old days for Mclaren for sure.

4

Did you know Ron Dennis doesn’t have an e-mail account ?
Ronzo still uses fax-simile.

It’s such a contradiction.

5
Anthony Jenkins

What McLaren is now best at. Talk.

He’d like you to forget, but Mr. Dennis was once a mechanic. Now he is a powerful man in an expensive suit -talking untruths.

6

Vodafone you mean

7

Teams should be able to run different liveries on each car. Different sponsors would then be able to be placed on each car. This should be cheaper to just sponsor one car than both.

8

From a business perspective it appears a very logical step, securing multiple smaller advertisers for longer periods of time. As a race team manager it’s very risky placing all of ones eggs in one basket. A short term large value deal with an advertiser that terminates can leave you stuck with zero budget for next season. I can easily name many race teams that have folded as a result of their major advertiser leaving. Spreading that risk over multiple advertisers with disparate contract terms is solid mitigation strategy.

For Michael Kors I suspect that McLaren not currently winning races is totally irrelevant, they will have thoroughly researched the coverage McLaren and their drivers attract and determined the value for money proposition. Coverage doesn’t just mean race day TV, in fact it’s probably a very minor part of the overall package. It maybe be important to F1 fans, but to Michael Kors buyers it most likely not even on their radar.

9

Hmmmm, I see no one here wants to give Ron credit for all those race wins and championships. Even if you subscribe to the view that McLaren the team has utterly had its day … admit it was one hell of a day!

10

Cute spin job, Ron!

11

How is speed inherent to the Michael Kors DNA, and how is style inherent to McLaren’s?

12

WOW.
I’ve been a life long Mclaren and Ron Dennis fan and although it’s not surprising to hear Ron diversify the business model to suit the market,it must have taken a huge gulp of pride from him to say these words.
Thankfully Mclaren will win both titles next season and he’ll be able to repay all the sponsors that have believed in him.

13

When the desirable is not available, the available becomes desirable. Interestingly, Ron has been able to do a like for like with departed long term partners. Tag Heuer replaced by Richard Mille and Hugo Boss replaced by Michael Kors.
At the end of the day, Ron gets an A+ for faith…. In ones own ever evolving gospel.

14

So Sensodyne toothpaste meets the criteria of “comparable products that sit comfortably here with a common objective”?

Sponsoring a mid-field F1 team is borderline insane from a value perspective (not to mention being associated with mediocrity, regardless of how fantastic a team may be and how difficult it is to even be somehwat compoetitive in F1), so no wonder the reality is that small deals are likely all that is out there, regardless of how it is spun.

Heineken’s deal is the way forward – if you can’t get your name on a top-3 machine with a chance of victory, then sponsor an event or F1 itself.

15

If you use Sensodyne it makes you less sensitive. And last few seasons McLaren needed to be less sensitive.

16

James – do you ever think that Stroll will buy an F1 team? Perhap’s Sauber?

17

Dennis has been saying this for the last 3 seasons his cars have been blank.

18

A Very Diplomatic answer from Ron.
Kors fashion brand and Hugo Boss are they on an equal setting?
Hugo has to be a huge brand that left for Mercedes as did Lewis.
Just hope this ‘short term’ excuse isn’t an excuse for the ‘big term long term’ excuse coming in 2017. If you know what I’m getting at in the short term long term Ron.
Surely Honda are no were near the league they were in Senna Years at Mclaren.
Mclaren seem to be farting into the wind a lot and it is beginning to hums like the Honda Engine.
Just hope they start delivering fast and go back to winning ways.

19

When someone brings up ‘DNA’, I know they are talking [Mod]. Ron Dennis would love to have a big money sponsor like Vodafone, even for one season. It ain’t gonna happen, so he’s claiming he’s not that bothered. Having several small sponsors means a lot of running around and possibly making his drivers do too much PR work to keep the sponsors happy.
I remember hearing of Lewis Hamilton having to make day trips from Europe to India for Vodafone PR jobs. That was okay, but doing the same in his private life isn’t acceptable. Funny that.

20

In my opinion, for what it’s worth, is that Ron is trying to turn an ongoing embarrassment for McLaren (where they have not only had minimal major sponsorship on the cars, but have lost repeated sponsors to other teams), into something resembling a corporate strategy decision. “Pull the other leg now Ron!”

21

The ugliest car/livery on the grid, turn outs to be the result of small but long term deals….or in, other words, whatever we possibly get for this disaster of a car, 50 leather jackets could be a fair example.

22

Be more sensitive by brushing with Sensodyne.

23

No wonder McLaren are getting such a pasting……

24

@Seebee
…perhaps that’s why they’ve had so much teething troubles

25

And here I was thinking that brushing with Sensodyne was supposed to make you *less* sensitive 😉

26

I’m a Colgate man, so I covered my bases. See below.

27

Hmm, that sounds a bit like when Liverpool get knocked out of the FA cup and announce they will be “concentrating on the league” instead….

28

Sounds to me like writing the narrative to fit the circumstances but who wouldn’t answer in the same way?

29

James, do you think this is the right way to go? As all markets changes by time maybe it’s time to introduce new marketing solutions also for the teams in their hunt for sponsorship money… Do you now how much the deal with Michael Kors is worth? And how much sponsorship budget has McLaren comparing to their rivals?

30

What raised the costs so massively if not the PUs – the very costs that make sponsorship so expensive?

31

McLaren don’t pay Honda for their PUs.

32

Yes, and it cost McLaren nothing to adopt to them, I’m sure.

33

Sebee, I think you will find McLaren’s budget has remained the same since the V8 days. PUs have been bad news for the smaller teams, I grant you that, but the big 4 can afford it.

34

RON DENNIS: MCLAREN FOCUSED ON LONG-TERM SPONSOR COMMITMENTS OVER SHORTER F1 TITLE DEALS

Or as I like to call it…

RON DENNIS: WE STILL CAN’T FIND A TITLE SPONSOR

Hang in there McLaren fans – They’re bound to bounce back eventually 🙂

35

Love the first paragraph. Of course he would say he prefers not signing a title sponsor because he has to say that otherwise he looks foolish. Ron is just getting used to like in the middle of the pack.

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