INTRODUCTION next two years, F-1 Indian grand prix lost

INTRODUCTIONIndia hosted 3 editions of F-1 Indian grandprix at Budd International circuit in Uttar Pradesh. Event did not have so muchof a following other than the hype and noise that was created prior to theevent. The reasons for this could be due to many reasons such as the dominationof cricket among the people, lack of strong competition among the Indiansports, inadequate sponsorship etc.However, the major reason for F-1’s absence inthe arena is due to the disputes that are hanging between Formula One WorldChampionship Ltd & the organisers of the event Jaypee Sports InternationalLtd.

THE BACKGROUNDIn 2007, when Jaypee group got the rights to hold the then by far thebest motorsport event in India, the hopes were very high which was planned tobe held on 2011.The event was a massive hit in the First year but then aftersubsequently failing the next two years, F-1 Indian grand prix lost its’s plotbefore completely going out of existence. Adding to the organiser’s misery, theIndian grand prix comeback was given a hold after taxation dispute with thegovernment of India.

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Jaypee Sports International Limited which is a part of the Jaypee groupgot the rights to hold the event for the first time for mammoth 40 million USD.They had the rights to promote the event as well. During the course, the JSPIsold the rights to Beta Prema 2 which included Title and sponsorship deals, whoeventually then sold to Bharti Airtel. THE DISPUTEThe major dispute that is prevailing at present is the one between theJaypee, Delhi government and Formula One world championship Ltd.With respect to the time issue, the Supreme Court has ignored the factthat the event only take place a number of 3days of the total 365 days andinstead were focussing on the contract agreement which was for 5 years.

JAYPEE GROUPInitially, the Jaypee group had great plans toincrease their standards to higher levels starting of by entering in to buddhinternational circuit and by hosting the Indian grand prix 2011, which was thenbelieved to be the biggest sporting event at the time in India.Jaypee was in fact trying to bank onincreasing the prices of real estate in the areas nearby which was alreadybeing acquired by Jayepee in developing the township. They though there wouldbe an increase in demand for cement and power if there were increase in demandfor housing as well.

And hence, even during their tougher times during theglobal economic downturn of 2008, they invested 315 million USD and 198 croresfor license for the first race. By 2013, the license fee had rose up to 250crores through escalation clause and adding to that the Operational cost of2011 was just 122 cores whereby 2013 it had rose above 300 crores. Jaypee through the 1st editon in2011 managed to recover only 150 crores which was attended by 96000 spectators.The following years had a dip and rise in which brought 77 crores and 114crores for the 2012 and 2013 years respectively with the 3rdeventing bring a 66,000 spectators in total.

The group had to eventually writeoff a losses of 170 crores through having a total operating expenses of 274crores, and hence were forced to go on a disinvesting spree through sellingtheir interest in cement & Power sectors.And what that meant was that India’srelationship with F-1 was put on hold with the organisers making it clear thattheir return solely depends upon the tax issue.THE FUTURE OF F-1 IN INDIASports like kabaddi, badminton, tennis, hockey, football are trying totheir fullest to match the popularity that is being set by Cricket in Indiathrough bringing in League’s that are sponsored by Corporate and Non- Corporatecompanies. But in the case of motor sport racing, the fan base is a dynamic oneadding to the woes, the lack of a strong contender in the international arena.The Federation of Motor Sports Clubs of India are also seen to be poorin promoting the sport through national level events which could increase thefan base that the sport currently has. And more over there has been littleinterest among corporates to sponsor for motor sporting events as well. Themain issue being the perception the sport has among the corporates that it’s alow potential sport in India. This lack of interests among cooperates for thesponsorship of the events doesn’t do the FMSCI any good favour in organisingmotor sport events as well as promoting the sport.

The sport also might notalways provide back the incentives to sponsors and hence corporates always tryto stay in a safer place than promoting for such events.This issue has to be addressed even though it isn’t an easy task to doso. Incentivizing corporate sponsorship by including tax breaks could be oneway by which corporate sponsors could be attracted towards. Indian Governmentis found to be one among the few grand prix hosting governments who are notinvolved in the event.

Indian government could rethink on entering given thestate of affairs and increase the reputation od the sport in India which is oneamong the world’s most widely followed sport.  MARKETING F1 INDIAN GRAND PRIX Jaypee Group had paid a ransom amountof up to $400 million in order to make the Buddh International Circuit. In 2011the Jaypee group made a remarkable history by staging the first ever F1 IndianGrand Prix that India was waiting eagerly for.

In 2011, a total of about 1 lakhtickets were sold to the public whereas it wasn’t the same the following years. The question is that if there wasenough promotions, advertising and marketing being made prior to event to hostit successfully in order to attract the advertisers? The answeris that, simply not much were done to promote theevent when it’s compared with cricket which is a religion in India. There arelots of brands in case of cricket who wants to be a part of the event if incase of say IPL but it’s not in the case of F-1 sadly but things may change inthe future but as of now this has been a major drawback even though Airtel spenta lot of money for around Rs.34 crores for the event. The fact is that in 2011, sincesomething like this was happening for the first time there were lot ofexcitement around. People were so eager to experience the event for the firsttime from different parts of the country. But in 2012, with the slowdown thereweren’t many people interested to the event.

There were things that has to bedown with the cost too considering the airfares going up and people finding itless affordable to make it to the event. Adding to the misery there weren’t anyglobal sponsors as such as well. Leaving alone Vodafone who were the sponsorsfor the McLaren team there weren’t any global sponsors as such. So, Airtel hada huge weight on their shoulders to conduct the event and if it wasn’t forAirtel F-1 might have never happened too in India. Some of the internationalbrand s like Tag Heuer, Hugo Boss, UBS who were among the global sponsorsdidn’t have much of a presence in India and hence an Indian Circuit did not didnot give them the satisfaction in a global perspective and hence Indian grandprix had to rely on Airtel and Vodafone who were the major players in India.More over F1 as a sport was something regarded as a European phenomenon whichwas only starting to develop on to the other countries. Thepromotions which were seen in 2011 started to be missing in 2012 and 2013.

Advertisers had planned earlier and made the necessary arrangements for theevent way ahead earlier in 2011 and hence had advertising time both in printads and TV as well which was never seen in the following years. The blame couldnot put onto Indian sponsors as F-1 had the sponsorship and media rights. Thisalso could be seen as a drawback as well for instance in IPL, BCCI is involvedin promoting the event but in F-1, they do not do any promotions particularlyin new circuits. If that had been done things might have had a changeconsidering India being a motorsport country having a lots amount of Motorsport clubs and also considering the fact that that India is equipped with largemarket of Automobile companies too.

It was again surprising to not seeautomobile companies like Renault who in fact is a sponsor of leading Team inF-1 who supply Engines.   Looking atthe ratings for the year 2010, F-1 had crossed 1+ ratings which in fact whichwas high for any sport (not taking cricket into consideration here).Relating itto football and F-1 in other countries where only a rating in the range of 0.2-0.5 was seen per match and considering the demand of F-1 in India, it was alwayslikely to go down. In case ofSocial Media marketing, Red bull stood out from the rest in promoting theirteam for better fan followers but rest of them were a bit quiet. Even thoughmost of the teams had huge social media outreach in Facebook and Twitter, theycould have done more to attract the urban youth.

 The mainissue of ensuring the advertisers interested could have been made through theteams getting involved themselves as well as the team sponsors. As it was seen,other than Vodafone, there were absolutely no sponsors entering the fray. Therewere minimal pride in the event which was being organised in India that had tochange.  INTRODUCTIONIndia hosted 3 editions of F-1 Indian grandprix at Budd International circuit in Uttar Pradesh. Event did not have so muchof a following other than the hype and noise that was created prior to theevent. The reasons for this could be due to many reasons such as the dominationof cricket among the people, lack of strong competition among the Indiansports, inadequate sponsorship etc.However, the major reason for F-1’s absence inthe arena is due to the disputes that are hanging between Formula One WorldChampionship Ltd & the organisers of the event Jaypee Sports InternationalLtd.

THE BACKGROUNDIn 2007, when Jaypee group got the rights to hold the then by far thebest motorsport event in India, the hopes were very high which was planned tobe held on 2011.The event was a massive hit in the First year but then aftersubsequently failing the next two years, F-1 Indian grand prix lost its’s plotbefore completely going out of existence. Adding to the organiser’s misery, theIndian grand prix comeback was given a hold after taxation dispute with thegovernment of India.

Jaypee Sports International Limited which is a part of the Jaypee groupgot the rights to hold the event for the first time for mammoth 40 million USD.They had the rights to promote the event as well. During the course, the JSPIsold the rights to Beta Prema 2 which included Title and sponsorship deals, whoeventually then sold to Bharti Airtel. THE DISPUTEThe major dispute that is prevailing at present is the one between theJaypee, Delhi government and Formula One world championship Ltd.

With respect to the time issue, the Supreme Court has ignored the factthat the event only take place a number of 3days of the total 365 days andinstead were focussing on the contract agreement which was for 5 years.JAYPEE GROUPInitially, the Jaypee group had great plans toincrease their standards to higher levels starting of by entering in to buddhinternational circuit and by hosting the Indian grand prix 2011, which was thenbelieved to be the biggest sporting event at the time in India.Jaypee was in fact trying to bank onincreasing the prices of real estate in the areas nearby which was alreadybeing acquired by Jayepee in developing the township.

They though there wouldbe an increase in demand for cement and power if there were increase in demandfor housing as well. And hence, even during their tougher times during theglobal economic downturn of 2008, they invested 315 million USD and 198 croresfor license for the first race. By 2013, the license fee had rose up to 250crores through escalation clause and adding to that the Operational cost of2011 was just 122 cores whereby 2013 it had rose above 300 crores.

Jaypee through the 1st editon in2011 managed to recover only 150 crores which was attended by 96000 spectators.The following years had a dip and rise in which brought 77 crores and 114crores for the 2012 and 2013 years respectively with the 3rdeventing bring a 66,000 spectators in total. The group had to eventually writeoff a losses of 170 crores through having a total operating expenses of 274crores, and hence were forced to go on a disinvesting spree through sellingtheir interest in cement & Power sectors.

And what that meant was that India’srelationship with F-1 was put on hold with the organisers making it clear thattheir return solely depends upon the tax issue.THE FUTURE OF F-1 IN INDIASports like kabaddi, badminton, tennis, hockey, football are trying totheir fullest to match the popularity that is being set by Cricket in Indiathrough bringing in League’s that are sponsored by Corporate and Non- Corporatecompanies. But in the case of motor sport racing, the fan base is a dynamic oneadding to the woes, the lack of a strong contender in the international arena.The Federation of Motor Sports Clubs of India are also seen to be poorin promoting the sport through national level events which could increase thefan base that the sport currently has. And more over there has been littleinterest among corporates to sponsor for motor sporting events as well. Themain issue being the perception the sport has among the corporates that it’s alow potential sport in India. This lack of interests among cooperates for thesponsorship of the events doesn’t do the FMSCI any good favour in organisingmotor sport events as well as promoting the sport.

The sport also might notalways provide back the incentives to sponsors and hence corporates always tryto stay in a safer place than promoting for such events.This issue has to be addressed even though it isn’t an easy task to doso. Incentivizing corporate sponsorship by including tax breaks could be oneway by which corporate sponsors could be attracted towards. Indian Governmentis found to be one among the few grand prix hosting governments who are notinvolved in the event.

Indian government could rethink on entering given thestate of affairs and increase the reputation od the sport in India which is oneamong the world’s most widely followed sport.  MARKETING F1 INDIAN GRAND PRIX Jaypee Group had paid a ransom amountof up to $400 million in order to make the Buddh International Circuit. In 2011the Jaypee group made a remarkable history by staging the first ever F1 IndianGrand Prix that India was waiting eagerly for. In 2011, a total of about 1 lakhtickets were sold to the public whereas it wasn’t the same the following years. The question is that if there wasenough promotions, advertising and marketing being made prior to event to hostit successfully in order to attract the advertisers? The answeris that, simply not much were done to promote theevent when it’s compared with cricket which is a religion in India. There arelots of brands in case of cricket who wants to be a part of the event if incase of say IPL but it’s not in the case of F-1 sadly but things may change inthe future but as of now this has been a major drawback even though Airtel spenta lot of money for around Rs.34 crores for the event.

 The fact is that in 2011, sincesomething like this was happening for the first time there were lot ofexcitement around. People were so eager to experience the event for the firsttime from different parts of the country. But in 2012, with the slowdown thereweren’t many people interested to the event. There were things that has to bedown with the cost too considering the airfares going up and people finding itless affordable to make it to the event. Adding to the misery there weren’t anyglobal sponsors as such as well. Leaving alone Vodafone who were the sponsorsfor the McLaren team there weren’t any global sponsors as such. So, Airtel hada huge weight on their shoulders to conduct the event and if it wasn’t forAirtel F-1 might have never happened too in India.

Some of the internationalbrand s like Tag Heuer, Hugo Boss, UBS who were among the global sponsorsdidn’t have much of a presence in India and hence an Indian Circuit did not didnot give them the satisfaction in a global perspective and hence Indian grandprix had to rely on Airtel and Vodafone who were the major players in India.More over F1 as a sport was something regarded as a European phenomenon whichwas only starting to develop on to the other countries. Thepromotions which were seen in 2011 started to be missing in 2012 and 2013.Advertisers had planned earlier and made the necessary arrangements for theevent way ahead earlier in 2011 and hence had advertising time both in printads and TV as well which was never seen in the following years. The blame couldnot put onto Indian sponsors as F-1 had the sponsorship and media rights. Thisalso could be seen as a drawback as well for instance in IPL, BCCI is involvedin promoting the event but in F-1, they do not do any promotions particularlyin new circuits. If that had been done things might have had a changeconsidering India being a motorsport country having a lots amount of Motorsport clubs and also considering the fact that that India is equipped with largemarket of Automobile companies too.

It was again surprising to not seeautomobile companies like Renault who in fact is a sponsor of leading Team inF-1 who supply Engines.   Looking atthe ratings for the year 2010, F-1 had crossed 1+ ratings which in fact whichwas high for any sport (not taking cricket into consideration here).Relating itto football and F-1 in other countries where only a rating in the range of 0.

2-0.5 was seen per match and considering the demand of F-1 in India, it was alwayslikely to go down. In case ofSocial Media marketing, Red bull stood out from the rest in promoting theirteam for better fan followers but rest of them were a bit quiet. Even thoughmost of the teams had huge social media outreach in Facebook and Twitter, theycould have done more to attract the urban youth. The mainissue of ensuring the advertisers interested could have been made through theteams getting involved themselves as well as the team sponsors. As it was seen,other than Vodafone, there were absolutely no sponsors entering the fray.

Therewere minimal pride in the event which was being organised in India that had tochange.