21/01/2011
FEATURE BY CHRIS BALFE
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It's around half-an-hour after midday, though, in former times it would have been regarded as dawn. Lou Reed sang of the Power of Positive Drinking, a song that could well be seen as the anthem for this particular little part of Soho.
At the bar, a wannabe Brendan Behan stares mournfully into his glass, in the far corner a couple of Japanese tourists jostle one another excitedly as they prepare to have their picture taken with Suggs.
A few years back, my wife and I took a taxi from Soho to Tottenham. While there are an increasing number of cab drivers who prefer to do their work in total silence, listen to the radio or chat to a mate using the hands-free, in the old days one would often find one's self being driven by one of life's great experts. Be it philosophy, the origin of the species, football, politics or religion, your average London cabbie would have an opinion, and be only too delighted to share it with you.
My wife often playfully reminds me of that journey, an hour long 'discussion' in which both the cabbie and myself, no matter the topic, preceded each statement with the words… "the thing is…"
Both self-declared experts, no matter how much force we put into those three little words neither of us ever came up with the definitive statement, instead we were happy simply to listen to ourselves attempting to out-talk the other.
And so I am sitting in the French House with Julian Cottam, a man as passionate about many aspects of life as I am. Having been introduced by Glen 'Crompo' Crompton, our mutual love of F1 goes without saying. However, from the first time we met, in the Coach and Horses round the corner, it transpired that there were many other things we have in common, not least a love of Soho, even if it is the Soho of old.
In the past we have spent many an afternoon (and evening) discussing movies, music, TV, radio, Catherine Deneuve, Polari and Monty Python… indeed I cringe when I remember an afternoon when a woman, on overhearing us recounting the Four Yorkshiremen sketch, took offence - she being from 'Oop North' - and attempted to hit us with her umbrella.
However, today, we are determined to talk only of F1, both having admitted to having reservations about the way it is heading.
By way of introduction, Julian (right) is someone who has walked the line between the commerce of the Formula 1 paddock and the boardrooms of the corporate world for many years. In fact, his first full season following the Grand Prix circuit was 1984 where he cut his teeth selling marketing promotions and sponsorship materials to manufacturers and team partners on behalf of Autosport magazine.
Since then he has worked as sponsorship principal for some of the biggest names in the sport including Lola, Prodrive, McLaren and Renault. In recent years he has worked in other fields but is now considering a full-time return to international motor sport. With the launch season just around the corner, what better time to get his thoughts.
With the first of the launches (Ferrari) just over a week away, I begin by asking if we will see many new partners this season or will it be similar to recent years where very few new brands come in to Formula 1?
"We will see a few new names," he replies, "but sadly it will be a few rather than the many that we have seen in past times."
Thankfully, he doesn't utter the words "the thing is", but as he leans forward, the inference is clear. "Formula 1 has been losing sponsors faster than it can recruit them and not all of it can be blamed on the global economy. I have been working around other sports in recent years and these properties are seeing fresh new partners in spite of the downturn.
"With Formula 1 there had to be a breaking point where it began to appear as poor value for money and now the teams need to come up with more creative ways in which to attract new partners who are, after all, the lifeblood of any successful race team."
Which begs the question, in what ways can teams gain more new partners in light of the economy?
"They need to create a proposition which goes beyond the traditional rights package and look at an individual prospective partners needs by creating an integrated marketing programme that involves Formula 1 as part of it," is the unhesitating response.
"Good examples are to look at what brands like Santander and Vodafone have done with their sponsorships. They also need to look at the costs involved, after all the value of anything is dictated by what people are prepared to pay for it, not what the vendor insists upon.
"More than anything, I think it is important to look through the eyes of the prospective partner and ask if they are being offered something that represents both value for money and a true solution to their global marketing challenges."
No matter the outward outrage at some of the scandals that have engulfed our sport in recent years, Max Mosley's private life, Spy-gate, Crash-gate and so on, the fact is that such stories have meant more hits on the websites, more magazines sold and more TV coverage. However, one has to wonder whether these various episodes have harmed the sport in terms of negative publicity and ultimately sponsorship.
"Of course, the old adage that any publicity is good publicity is clearly dispelled by the outcome of these front page scandals involving the sport," says Julian. "The Max incident did the sport no harm at all in the long run and merely served to show up the News of the World and its continued policy for ridiculous cheque book journalism.
"The Crash-gate and Spy-gate scandals however, were actually damaging to the image of the sport as nobody in the corporate world is going to be attracted to a sport that is known for cheating and espionage. From a sponsorship perspective obviously ING terminated its agreement with Renault before the end of its term and others may have had second thoughts about entering it.
"The real tragedy for me," he continues, a frown clouding his face, "was the loss of Pat Symonds and Dave Ryan who I have both had the great pleasure of working with. To my mind there are few race engineers and readers of a race that can match Pat, and Dave was an excellent team manager who had been loyal to McLaren since 1973. The babies got thrown out with the bath water as it were. As with all scandals there is always at least one innocent victim. As an example from outside of motor racing, all players in the Profumo Affair ended up relatively unscathed in the long run but Stephen Ward who's only crime was naivety ended up the victim."
I'm still smarting from the post-season episode when I was told to remove the GP2 and GP3 logos from Pitpass, having been warned that I "could be in trouble" for using them without permission. Mindful of this, and the fact that FOM employs around 300 lawyers to keep an eye on such 'infringements', such as removing coverage from YouTube, I am concerned that such an attitude will stifle the sport.
I mention the hassle that Sylvester Stallone encountered when attempting to make a movie about F1, his despair at Bernie Ecclestone's demands. The lack of F1 games, the failure to attract future fans (kids), indeed, the fact that the sport, in its desire to conquer the world, is losing touch with its roots and the fans.
"I think it important for FOM and the teams to protect their intellectual property rights in order for them to maintain control of their image and hold on to the value of those rights so that they can effectively sell them on to official partnerships," says Julian, a response delivered in such a manner that I wonder whether he's reading from a script or is merely 'hot wired' to Bernie. "However, it can be argued that things have gone too far particularly with regard to FOM and how they are dealing with the internet. They are still going through the growing pains that the record industry went through in terms of music publishing. What needs to be learnt is that one needs to go with the flow and work with it rather than unreasonably trying to prevent everything in a paranoid way.
"As for the Stallone deal being missed, I can only agree with Mr. E on that one given the evidence of Driven," he smiles. "It was quite possibly the worst film of all time and I am thankful that Frankenheimer's Grand Prix remains as the final say on Hollywood and Formula 1.
"I do think that F1 lost touch with the grass roots fans a long time ago and that is something that needs to be addressed," he admits. "It's something that NASCAR does so well and Formula 1 does so terribly badly. There doesn't seem a great motivation to rectify this but I think it important to open the sport to the widest possible demographic rather than push it back to an elite sport for the rich as it was until as recently as the 1980s."
"MotoGP, the WRC and NASCAR are all very strong categories. Is Formula 1 still the pinnacle of the sport and what could it do to make it better from a sponsorship point of view?" I ask.
"MotoGP and the WRC have done an excellent job in both the presentation of their TV show and with their live format however, they remain very strong in specific markets with no obvious push to develop in new markets.
"NASCAR is an immensely strong domestic series and as you can see with the NFL, NBA and World Series, the US is big enough and insular enough to provide that strong support. Formula 1 has always had a rather snooty view of NASCAR but they really should take the time out to experience it for themselves.
"In 2002 the Operations Director of Renault and myself were invited by a mutual sponsor and Penske to attend a race on a busman's holiday. On the recommendation of an American racing driver friend of mine we went to Bristol for the short track night race and I was blown away by the whole show. Yes, it's not a sophisticated animal like F1 but a grid full of NASCAR's on a short oval at night with 165,000 fans piled high above the circuit is something to see. They sold a whole lot of chicken wings, beer and merchandising and everyone of all age groups had a great time. They really understand the grass roots and look at where that takes them in terms of the TV audience and value for money sponsors - it's huge. Also in terms of sponsorship, it is chock full of big corporations and their brands and when one moves on to another activity, there's another waiting to replace them."
"Is Formula 1 still the pinnacle of motorsport?" I ask.
"Yes, of course it is," he replies without a moment's hesitation, "in terms of both the technological challenge to the teams and manufacturers and in terms of global markets and numbers of viewers.
"But if the show isn't any good and not exciting its audience then people are going to stop going to the races and do something other than sit in front of their TV's on Sunday afternoons. That would of course be bad for all concerned, sponsors included. Last year was tremendous in terms of the number of different drivers and teams fighting for both world titles right up to the last race. I hope that with the reintroduction of KERS, the new aero regulation and the lottery of each team's suitability to the new Pirelli tyres will go one step further and make for an even more exciting and memorable season. That would be great news for everybody and in my case, good news for sponsors."
Given there are more efficient ways of buying television air time, I wonder what potential sponsors look for when investigating F1? Is it a case of traditional investment for exposure or has the tide now moved towards business-to-business relationships?
"A sponsorship with a Formula 1 team is much more than a visible brand proposition although this is a valid part of association and a good measurement of the value the partner receives from their particular brand positioning and the success of their particular team.
"You mention the business to business element and this can be another positive benefit with a team partner receiving incremental business with the team manufacturer or with fellow team partners. This does happen although I have never offered it as a given or as the main reason for them to get involved. For the partner however, it remains as an instant measurable return from their spend on the programme.
"There are many other benefits such as shaping brand perceptions based in an F1 involvement, the technological exchange that can be gained through involvement or the image shift connected with the fame and glamour of F1 are just some of the many different benefits afforded to a partner. Whatever their reasons for being in F1 or their ambitions, it is up to the teams to not only deliver but to over deliver against their expectations.
"This is the way to retain partners in the long term and McLaren have always been head and shoulders above the other teams in doing this. They always go the extra mile in terms of over delivering against expectations and the success of that is proved by the longevity of partnerships like Hugo Boss and Mobil to name just two. That was something I learnt from my time there and something that all other teams should try and emulate."
I wonder if the costs of involvement in F1 dictate different ways of getting into the sport, thinking partnership with the sport and trackside advertising - such as LG and DHL as opposed to sponsoring a team.
"The reason that brands like LG and DHL get involved in partnership programmes with the championship as opposed to the teams is not driven by cost," says Julian. "Indeed, the investment made in a series sponsorship is considerable and no less than a team partnership as you suggest.
"In the case of LG, they have in fact chosen both avenues through their F1 partnership and their Red Bull partnership. For some brands it is more appropriate to sponsor the whole event rather than a team. That way they are never in a win or lose situation as you are when associated with one particular team or competitor. For example, Coca-Cola has been an Olympic sponsor since 1928 and a World Cup sponsor since 1974 but you would never see the red and white brand on a team or a competitor. I know the CEO of Coke quite well and believe me I've tried! On the other hand, if a trackside sponsor brings guests or customers to a race it is very difficult to get excited and cheer on or support a billboard and team partners have this emotive element to their association."
Over the last few years there's been a general changing of the guard in terms of the handover to new team principals, supposedly to take the teams and the sport forward. Has this changed the way in which the sport handles its commercial dealings, and how do some of the new guys compare to their predecessors?
"There have indeed been a number of new faces coming to the fore, and as with all things there have been some excellent choices," he replies, and as a smile begins to spread across his face he continues; "however, there have been some not so good choices… in my opinion.
"If you look at a team like McLaren, Ron has handed on the reigns to Martin Whitmarsh which is obviously a logical and excellent choice. He has a good background from British Aerospace and a lot of experience in an Ops Director and MD role at McLaren. The succession plan has been seamless and he is also doing an excellent job as Chairman of FOTA.
"Christian Horner's first five years in Formula 1 have been outstanding and given a free hand by Dietrich Mateschitz he has shown what can be done with excellent recruitment and management.
"On the other hand there have been a few cases where you wonder how on earth an individual was given such a high profile job. I was in the Monza paddock in recent years and was speaking to one of the newer senior people in the business. I commented that having been to just about every circuit since I started in 1984, Monza was still in my top three. He sneered a bit and commented that he thought the place was looking a bit tatty and beyond its sell by date. I said that I thought the banking should have a permanent preservation order on it and he looked at me blankly. It transpired that he had never heard of it and so I immediately directed him through the infield to enlighten him. He looked up at the old feature of the circuit with an expression on his face like that of a child who had just been introduced to the concept of the pyramids! If you think we should be concerned about the future of F1 in the hands of such people I say be scared, be very scared indeed!"
Despite the offer of a large Bloody Mary - the 'to die for' drink of choice when it comes to The French - he refuses to name the person, his ethics, much like his willpower in the face of such a bribe, are to be admired.
"I should imagine that the sales techniques employed in a sponsorship proposal for F1 are quite sophisticated. What do teams need to do to improve on this," I ask.
"Obviously with the advent of the computer in our every day lives, presentations took a quantum leap forward. It was only in the mid 1990's that I stopped using slide transparencies!" he admits with a laugh.
"I have to say," he continues, "that they really need to look at some of the most basic things which seem so obvious. Since I've been working on the outside looking in, I have been horrified at some things that have happened. I got a sponsor interested in coming into Formula 1 and after some due consideration we decided on two prospective teams to place the sponsorship with. The selection was based on team performance, colour suitability, a lack of conflict with the partner's business territory and a couple of other issues. Now, having worked the F1 paddock for over twenty-five years, I know exactly who to talk to and have the telephone numbers in my head. Even then, it took me calling for over a week to actually get through to who I needed to speak to. Obviously they were so busy looking for new sponsors that they didn't have time to look at one that was being handed to them on a plate with a 50-50 chance of getting it. Either that or they felt so self important that they didn't need any help! Further to that, had I not known who to contact I could have given up trying. None of the team websites have something as simple as a link to connect sponsorship enquiries to a name, a number or an e-mail address. It sounds ridiculous I know but it's true.
"Another true story is from when I headed up sponsorship at Renault and a curious prospective sponsor made contact with me through checking out the team web site. I had six meetings in six different countries from Tokyo to Rome and four other points in between and I ended up signing them to a $24m deal. And before any team commercial people say 'it wasn't me he couldn't reach', it was certainly two out of twelve possibilities."
With some teams seemingly satisfied with running at a loss and sponsorship shrinking, what is the future for sponsors and F1?
"I don't think any business wants to run at a loss but it certainly seems to be the reality for many teams at the moment," he replies. "When I was at Renault, they spent by far the least of the six manufacturers involved in F1 at the time. Through sponsorship revenue, technical alliances and official suppliers I managed to make Enstone financially self sufficient and this was at a time where we won back-to-back double World Drivers and World Constructors Championships. I would imagine this is the ideal combination and target for any team. As I said previously, times are hard but you can't hide behind the world economy excuse for ever. Sometime soon you need to deliver and that means working that bit harder, that bit longer and that bit more creatively than your competitors. I think there is still a big future for sponsorship in all sectors and walks of life. In terms of advertising and promotion it's still the new kid on the block and I love working in the business."
The bar is filling up, so we make the decision to retire around the corner to the Coach and Horses. Both of us have fond memories of the legendary pub, having been regulars for almost forty years. Indeed, we were both there the day former proprietor Norman Balon - self-proclaimed 'rudest landlord in London' - retired in May 2006.
While I continued using The Coach after Norman had left - funnily enough, so did Norman - I stopped using it in 2009 when it was clear the new owner couldn't distinguish between rudeness and sheer pig ignorance.
Taking a place at my favourite (Greek Street) end of the bar, I mention to Julian that while he has touched on some of the bigger names in Formula 1, of the smaller teams who does he think is doing a good job from a commercial perspective?
"Well, of the three new teams there is a mixed bag of offerings and each has gone about it in their own way. I don't want to get into the whole rights and wrongs of the Lotus naming issue but Team Lotus, as they are currently known, have done a solid job in 2010 and have attracted a number of reasonable partners.
"Virgin is in safe hands with Jim Wright at the helm of the sponsorship programme and he brings a considerable amount of experience in sponsorship from his many years at Williams.
"Hispania has been something of a disaster," he sighs, "and they are not really in a position to compete at this level. When a team relies on pay drivers and lives on a hand to mouth existence it is only a matter of time before they go. You have to take your hat off to them for actually making it throughout he whole season and apparently ready to take on another campaign."
Without breaking any paddock codes, I suggest that following a quarter of a century in Formula 1 Julian must have some amusing stories to tell. Looking around to ensure that nobody is within earshot, he smiles and leans forward.
"Well of course there are some great stories to be told but unfortunately modesty dictates that I am unable to name names unless I was confident that I wouldn't receive a tap on my shoulder from a 9mm handgun in my not too distant future!
"Seriously," he continues, "when you consider the extreme world that one finds oneself in there have obviously been some funny heart stopping moments but discretion forbids me from giving an indication of a name or place. However, there was one incident a long time ago that involved the final negotiations with a very big prospective sponsor who unknown to us also happened to be a born again Christian. You can therefore imagine the horror when my boss at the time alluded to the possibility of the two of them entering into a world tour that involved the company of many professional young women. Suffice to say, that deal somehow slipped from my grasp in the dying moments.
"There was another occasion when a highly valued existing sponsor who was Chairman of a vast corporation and his wife experienced a catalogue of disasters whilst we attempted to deliver them for drinks aboard a yacht in Monaco and ended up with us almost drowning the pair of them. The memory of it makes me cringe to this day!"
Unsure whether it's the London Pride, Bombardier, Greene King or Bloody Marys that are kicking in, I go a little surreal - Soho has been known to have that effect on people, especially journos and writers.
"If time travel were open to you as part of your presentation to a prospective sponsor, and based on your many experiences from races over the years, what would you like to show them from the history of the sport?" I ask.
Julian, initially unsure whether I've finally lost the plot, thinks long and hard. After several minutes, he replies: "It would have to be something that I've experienced for myself and they are many and varied. For most people, the closest you ever get to riding with a top class driver is from the onboard cameras. On the other hand I have been fortunate enough to have been driven in road cars by drivers including Ayrton Senna, Jo Gartner, Stefan Johansson, Stefan Bellof, Giancarlo Fisichella and Fernando Alonso to name a handful. "Some of them were very sedate journeys but I will never forget being driven by Ayrton whilst in the back of an Escort XR3 which is not exactly a supercar but it made you appreciate what people mean by car control!
"In terms of racing, TV and even live track-side viewing do not compare to the tension experienced as a team member with access to team communications. From my Renault days two races stand out for tension and drama and both from the dying stages of races.
"The first is Schumacher's relentless hunting down of Fernando at Imola in 2005 and Kimi closing in and eventually passing Fisico in the final laps of the 2005 Suzuka race. Both were nail biting and enthralling and captured the extremes that drivers go to in order to defend their lead in a race. In both cases the two coolest customers were the drivers themselves whilst the race engineers pleaded with them to push and they casually came back with, 'don't worry, I am pushing'."
As the bar begins to fill, Julian and I look at one another, deciding that it is best that we call it a day and leave Soho to the beautiful people. With the first launch just a few days away and the first pre-season test just a couple of days later, I ask of his plans.
"You've been working in other fields for the last couple of years but I know you're looking at a return to international motor sport. Is this a good time, what is the plan or is it too early to tell?" I ask.
"I've spoken to a few people and am looking at the possibility of retention on a contracted basis or possibly to work full-time for one particular team," he replies. "I'm open to all possibilities. In terms of the current climate, I think Formula One has had a good year and the indicators are that it could be even better in 2011 so in spite of the global economy I think its a good time to get involved whether from my perspective or that of a sponsor who is looking to Formula 1 as a possible way of marketing their brand globally."
As we head out into Greek Street the rain is beginning to fall. We look back towards the bar but our seats have already been taken. He turns to me; "you know, this has all been about me you old sod," he says, "what are your thoughts about the sport?"
"Well," I reply, and buttoning my jacket against the rain and pondering whether I have time for a quick IPA in The Ship, I continue… "the thing is…."