The F1 Bump

#INFINITI

When Infiniti signage first appeared on the Red Bull RB7 Formula 1 car in 2011, it was so small and subtle that it looked more like graffiti than the launch of a multiyear, multimillion-dollar marketing campaign.

The timing also seemed odd, considering that Toyota, Honda, BMW, and even Renault -- Infiniti's parent company -- had recently ended exorbitantly expensive forays into F1 team ownership that produced little more than ego gratification and public embarrassment. But Infiniti has enjoyed the last laugh.

"Infiniti haven't made the investment that Toyota or Honda did," says Red Bull Racing's team principal Christian Horner. "But they've been involved in four world championships [two constructors' titles and two drivers' titles] in 2011 and 2012, so their investment has been extremely cost effective."

The relationship has been so fruitful, in fact, that Infiniti raised the ante for 2013. This year's F1 team is officially known as Infiniti Red Bull Racing, and Infiniti signage now graces the premium sponsorship space on the side pods of the RB9. (Renault continues to supply the team's engines, as it has since 2007.)

Neither Infiniti nor Red Bull would disclose how much money is involved. But Christian Sylt, a British journalist who focuses on the business of F1 and publishes the annual Formula Money guide, estimates that Infiniti provided about $40 million in 2011. Although that number is surely much higher today, it's still a fraction of the $400 million a year that Toyota reportedly spent winning a grand total of zero F1 races as a team owner from 2002 to 2009.

Besides being the pinnacle of motorsports, Formula 1 is often billed as the world's most popular sport -- except in the United States, where it occupies an immeasurably tiny niche. But North America has long been Infiniti's largest market by far, and the rapprochement with Red Bull is all about extending the brand's reach to Europe, Asia, and Australia.

"There are markets where brand awareness is one or two percent, and people think we make loudspeakers or ice cream," says Andreas Sigl, global director of Infiniti Formula One. "We want to grow worldwide, so we need a global platform that works everywhere. And we're seeing -- especially in places where Infiniti hadn't been on the map -- that we're getting both name awareness and an understanding of our attributes of being a challenger brand and a premium brand."

The knock on motorsports sponsorship is that it costs a fortune, but the metric traditionally used to evaluate return on investment -- brand exposure via television coverage -- is no longer valid in a world dominated by the Internet and social media. "The 200-miles-per-hour billboard is a completely outmoded rationalization of why you would go racing," says Mark Coughlin, Motorsports executive vice president at Octagon, which negotiates high-dollar sports and entertainment sponsorships.

Sigl agrees, which is why he says the technical partnership between Infiniti (through Nissan and Renault) and Red Bull is critical. There's already been considerable cross-pollination between Red Bull Racing's F1 headquarters in Milton Keynes, England, and the Nissan Technical Centre in nearby Cranfield. Also, last year Infiniti sold a limited-edition, $155,000 FX Vettel Edition sport-utility vehicle developed with world champion Sebastian Vettel's input. Are there more collaborations in store? "All I can say," Sigl says, "is that there's a lot of interest on both sides."

INFINITI
2012 MARKET SHARE

0.8%
United States

0.2%
Global

GLOBAL SALES
160,000
(2012, estimated)

500,000
(2017, targeted)

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