Zak Brown, founder and CEO of Just Marketing International (JMI), the world’s largest motorsport marketing agency which was founded in 1995 and acquired by CSM Sport & Entertainment, a division of Chime Communications plc, in 2013, has warned that F1 must rein-in its spending.
The American former professional racing driver, is widely recognised for his accomplishments as a sports marketer having been named numerous times in the INC 500 Fastest Growing Private Companies of the Year and recognised as Marketer of the Year by PROMO magazine.
Speaking to Reuters, Brown has become the latest to warn that the sport cannot continue on its current path of spend, spend, spend.
"From our standpoint, interest is as strong as ever," he said. "But if you separate how we are doing and look at the sport as a whole, other people aren't announcing deals, the McLaren car is pretty blank.
"The overall sponsorship economy, while we are bucking the trend, is very down in Formula One. That's a fact, just look at the cars," he added, almost certainly a reference to the McLaren.
"The potential for the sport is untapped," he continued. "I think it needs, as an industry, to be much better marketed. It's not where it needs to be.
"The budgets are out of control. And that then forces the whole eco-system of the sport to be financially strained, the expense of the sport is out of balance with the commercial value of the sport. Budgets now are $200 - 300 - 400 million. It's nuts!
"We don't need $400 million budgets. And if we don't need $400 million budgets, we don't need the same size of sanctioning fees which are putting tracks out of business, which then means we don't need to charge the consumers as much.
"Losing Germany, I haven't had anything other than disappointment from sponsors on that," he admitted. "With Italy there will be the same reaction.
"Some of the new markets, Mexico, are fantastic. Some of the other markets that are new, less so. We are adding some good ones... but then there is speculation of a third race in the Middle East. How can you have three races there and none in Germany? I think the two they have are outstanding and contribute a lot to the sport but a third? I don't think the market can support that.
"What I'm seeing is attendance is down, TV ratings are down, car count is struggling," he concluded. "So your key performance indicators are all on a downward trajectory right now.
"Every single client we had that was up for renewal has renewed. Every client we have that is in Formula One, is happy they are in Formula One. But even though the sport is massive, marketers do like things that are hot and buzzy. And right now Formula One doesn't have the buzz it's historically had. I think it can come back but they need to work on the product."
Interesting thoughts from a man who knows his business.