F1 Sponsorship Cost: A Comprehensive Breakdown

How much does Formula 1 sponsorship cost?

The cost of a Formula 1 sponsorship deal can go from $1Mil to $70Mil, depending on the marketing benefits you want to include and the teams you want to sponsor. For instance, if you aim to be a global partner, you can expect a significant investment. Global partners such as Monster Energy and Ray Ban have sizable contracts with F1 Teams, reflecting their worldwide branding and the widespread appeal of F1.
Single race sponsorships can start at costs of $500K but need to be evaluated carefully as they are very tactical marketing tools. Local companies, or regional partners, might find this a more cost-effective route into F1 sponsorship.

Entry levels of $1Mil will buy little to no visibility on the car -and hardly on top-of-the-grid challengers – and the right to use the teams’ logo, name and fame on your marketing and communication materials. This approach is often followed by brands who aim to become an official partner. These partners will then engage with fans worldwide via social media platforms and other means to boost their visibility.

On the other end, $50Mil+ have a wide and extraordinary array of marketing benefits. While your logo on the car is generally very big, it’s the amount of activation opportunities, PR stunts, hospitality packages, media support and communication grunt that really make these deals true marketing powerhouses.
Companies like Cash App have used these opportunities to their advantage, building a strong presence in the F1 world through extensive sponsorship.

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Understanding the cost of Formula 1 sponsorship

The cost of sponsoring a Formula 1 team can vary greatly depending on the size and involvement of your company.

As an example, smaller businesses usually pay around the $1Mil mark, while larger corporations may spend several million dollars per year in support for their F1 sponsorship.

In many articles of this blog we have attempted to answer the question “how much does sponsorship cost…“? Or “How much to sponsor a F1 team?”. These are key questions when we face a sponsorship project in a company, and it is one of the first questions that is asked to sport marketing agencies such as ours.

Today we want to deal with the cost of the sponsorships in the Formula 1 environment.

The most powerful sports marketing communication platform in the world

The Formula 1 championship has always been one of most interesting activities for those who study sports marketing and it is also a common case study in the sponsorship world. In fact, it is from Formula 1 that the concept of modern sport sponsorship developed, and it is here that we can still find the most surprising advancements of the discipline. That’s why there is always curiosity about the F1 sponsorship cost and the budget invested by Formula 1 sponsors.

Such as MotoGP, also F1 is a sport with planetary visibility, and it has the extraordinary (and very rare) characteristic of being a mobile communication platform: every 7 or 15 days the circus goes to a different country, bringing the possibility of engagement on site, hospitality opportunities etc.

The common belief is that the pinnacle of racing is among the most expensive sports to invest in. 

It’s totally worth it, though. Formula 1 represents the top-tier of motorsport, with a global TV audience of 2.1 Billion during the year (Brazil, Germany, Italy, UK, Netherlands being the top viewing markets) according to Nielsen. Overall, Europe is the first market for TV audiences (66,7%), followed by Central and South America (22,1%), Asia Pacific (5,1%), North America (3,4%) and Africa and Middle East (2,8%). The average F1 viewer is 38 yo, 62% men and 38% women with an average of 0,44 kids per household. It’s a younger, more diverse audience if compared with other major series like the Premier League (42 yo, 67% male) and the Champions League (41 yo, 70% male). Social media are also a valuable channel, with the F1 organization alone amounting to +31M followers across all the platforms. Teams as Mercedes, Ferrari and Red Bull can add their own impressive fanbases (21M, 14M, 18M followers each).

For many people Ferrari, Mercedes, and McLaren are not only sport teams, but symbols of speed, performance, excellence and technology.

The cost of sponsoring a Formula 1 Team and sponsoring the F1 Championship

First of all, sponsoring a Formula 1 team is very different than sponsoring the Formula 1 World Championship as a whole.

Trackside visibility, activation opportunities and fan-zone presence are just some of the benefits of being an Official Formula 1 sponsors among the likes of Heineken, Aramco, DHL and many more. If you’re looking for that sort of opportunity, we are looking at +€5M upwards per season.

As mentioned, it goes without saying that to answer the question “how much does f1 sponsorship cost” we should first define the property we are discussing and the benefits we are targeting. Because, at the end of the day, a F1 Sponsorship cost is only related to the marketing goals and needs of the sponsor.

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Expenses for F1 partnerships: entry level

Again, if we’re looking at ballpark figures, sponsorship deals in F1 start at $1Mil. For that sum, there’s very little branding on cars. Your logo will show up in the teams’ communication materials and media but other than that, exposure is limited.  What you’re buying here is the right to call yourself a Formula 1 Sponsor and the opportunity to use the Team’s fame, image, name and logo in your marketing. Also, some of the most prestigious Teams might want a higher chip to sit at their table, especially for very crowded business sector.

Upper tiers of Formula 1 Sponsorship

Highly impactful sponsorships, with good visibility and a full array of benefits might kick off at $5M with main sponsorship and title sponsorship hitting tens of millions of euros per year.

Tier one deals might reach the €20-50M range, as is the case with title sponsorships for top teams like Red Bull, Ferrari and Mercedes.

Just to provide some examples of top Formula 1 sponsorship costs, the Cognizant – Aston Martin deal is rumored to be worth around $35M per year, not far from the $42M per year of the Petronas-Mercedes partnership. Always according to Sportspro media, the Oracle – Red Bull Racing sponsorship is in the $300M realm for 5 years, while the freshly-signed Bybit deal sits in the $50M per year tier.

From a purely economic perspective then, sponsoring a team, a driver, a race or a series are highly different, but it must be noted that there are further distinctions and that not everything is cut and dried. Sure, generally speaking sponsorship the whole F1 championship will cost you more than, say, sponsoring a driver, but that might not be the case if the driver is Lewis Hamilton and you are becoming a regional F1 sponsor for a very specific and niche industry.

Again, it’s hard to say just how much does Formula 1 sponsorship cost. As usual, it depends on the marketing benefits, on the brands’ objectives and activation plans, on the target market and, finally, on the performance of the team. What’s more important, though, is how much value brands and companies are getting from these F1 sponsorship costs. And if we take a look at the list below, there’s plenty of reasons to believe the ROIs are pretty high…

How to sponsor Formula 1

As mentioned above, opportunities in the circus are aplenty. From smaller deals to $70+Mil contracts, Formula 1 sponsorships are tailor made around any brands’ needs, mission, vision and purpose.

This incredible array of possibilities represents both a threat and an opportunity, of course. While bespoke F1 sponsorship packages are sure to meet the needs of any marketing project, newcomers or even experienced companies might get lost in such a diverse scenario. Where do you start from? How do you know if there’s a better chance or better deal with another team you didn’t know of? What kind of marketing rights should you want in your contract? How to liaise gracefully and efficiently with such a high-paced, complex sport?

Since 1995, at RTR Sports we provide consultancy to brands and firms wishing to enjoy the success and the glamour of the Formula 1 (and motorsport, in general) world. So, if you’re thinking of a Formula 1 sponsorship, we might be the best starting point for you and your marketing team. Hit the button below, or write at info@rtrsports.com

Pictures, top to bottom:

• EJ Mina, Charles in a competitive Ferrari at the AUSGP, Creative Commons Attribution 4.0 International license.
• Lukas Raich, FIA F1 Austria 2022 Nr. 18 Stroll, Creative Commons Attribution 4.0 International license.
• Takayuki Suzuki, F1 Rd.16 Japanese GP SUZUKA (FP1) Red Bull Racing (RB13), Creative Commons Attribution-Share Alike 2.0