FIA Formula E will raise around €5m ($5.75m) from the first year of its new Official Partner deal with Dutch beer brand Heineken.
SportBusiness Sponsorship understands the initial fee paid by Heineken will increase by around €500,000 each season, bringing the annual value of the five-year deal to around €7m in the contract’s final year.
The deal will run from this season until 2022-23, and will see Heineken become the event’s first Official Beer and Cider Partner, with exclusive pouring rights at all Formula E races (except the opener in Saudi Arabia, where the sale of alcohol is prohibited).
Formula E’s sale of pouring rights to an exclusive Beer Partner marks a significant shift for the championship, as previous pouring rights at E-Prix were sold to local partners on a per-event basis.
Heineken will also get trackside branding at four of the championship’s largest E-prix – in Rome, Santiago, Mexico City and New York – and will benefit from a suite of digital activation and access rights.
These rights include access to tickets, hospitality and VIP areas, access to Formula E’s digital and social media channels, and rights to offer live fan experiences on race days.
Heineken will also extend its ‘When You Drive, Never Drink’ awareness campaign from Formula One to Formula E.
Now approaching its fifth season, the ABB FIA Formula E Championship covers 13 races in twelve cities across five continents. This season opens with the Saudia Ad Diriyah E-Prix on December 15, and closes with a double-header in New York on July 13 and 14 next year.
Making the deal
The deal is understood to have evolved out of meeting between Alejandro Agag, founder and chief executive of Formula E, and Gianluca Di Tondo, senior global brand director at Heineken.
The two met at the Monaco Grand Prix in May, and opened negotiations on the possibility of expanding Heineken’s existing global sponsorship of Formula One into Formula E.
“We see the two platforms as complementary,” said Di Tondo, “and if there is one thing about Formula E that is super intriguing to us at Heineken, it has to be the city race, because this kind of setting offers a huge playground in which to activate our brand.”
The final deal was eventually signed in New York in mid-July, less than two months after the Monaco Grand Prix.
“When we met with Alejandro, we found that we clicked together very nicely,” said Di Tondo.
“The speed of the agreement was largely because we were able to rapidly align on mutually-beneficial objectives, and because we have a shared ambition around growth via cities among a millennial and Gen-Z audience.”
No agencies were involved in the deal, but Heineken has a group of retained agencies that it will work with on future activations.
Heineken strategy
Heineken says investing in global sports properties – such as Formula One, the Rugby World Cup and the Uefa Champions League – is the most effective way to reach new consumers, especially in urban centres where the brand already has a strong market share.
Di Tondo said Formula E will complement the brand’s position in Formula One, as Formula E attracts a younger audience of millennials and Gen-Z consumers.
In the first of half of last season alone, Formula E experienced 347-per-cent growth in social media engagement among 13 to 17-year-olds compared to the previous year, and 54-per-cent growth in engagement among 18 to 24-year-olds.
Likewise, the championship’s official social media accounts gained 128 per cent more followers among 13 to 17-year-olds in the first half of last season than in the previous year, and 63 per cent more followers among 18 to 24-year-olds.
Overall, the championship completed the season with 581 million video views from all demographics across its social media accounts – an increase of 1,316 percent on the previous season – and 75 per cent more followers than at the end of the previous season.
“I see huge growth potential in Formula E,” said Di Tondo, “because it is something that is super topical – and it’s going to stay that way.
“I believe we are going to get two very exciting championships, and I don’t see a future in which either Formula E or Formula One will take over the other.”
Formula E sponsors
From Formula E’s perspective, Heineken is one the first global consumer brands to invest in the championship, following the likes of Swiss watchmaker Tag Heuer and German fashion brand Hugo Boss.
“If you look at the Formula E portfolio, we have a lot of technology and B2B brands,” said Agag.
“But to have a consumer brand like Heineken join us in this growth phase we are in at Formula E, that’s what makes this very special within our family of partners.
“We are very excited – it’s a real milestone for Formula E to have announced this partnership with Heineken, a brand with a huge heritage and a huge global footprint.”
Looking at trends in the car industry and consumer concerns around global warming, Agag is confident that Formula E will continue to grow not only in terms of viewers, but also as a sponsorship platform.
“In the European Union, we have an ongoing debate about tightening regulations on emissions for the car industry, and we are seeing all the big-name car manufacturers investing in electric products and vehicles,” said Agag.
“I think this trend will only get stronger in the coming year, and I think it will also drive growth and viewership at Formula E, which – I agree with Luca – is very compatible with the growth of Formula One.
“The better Formula One does, the better for Formula E and vice versa.
“I really think the future looks bright for us now.”
Formula E’s portfolio is comprised of Swiss tech brand ABB as Title Sponsor, Swiss bank Julius Bär as sole Global Partner, and Michelin as sole Technical Partner.
In the second tier, Heineken now sits alongside 10 Official Partners: carmaker BMW; insurance firm Allianz; logistics group DHL; watchmaker Tag Heuer; electronics manufacturer Bosch; Saudi national carrier Saudia; renewable energy brand Enel; recruitment firm Modis; fashion brand Hugo Boss; and Chilean mining firm Antofagasta Minerals.