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Question: When we had this first forum in Homestead earlier this year a big
topic of discussion was television ratings. My questions is how do you
measure the success and value of your involvement in cart and have you seen
an improvement since the beginning of the year in terms of marketing value?
Unger (Toyota): "I think Steve speaks to a point that all of the major sponsors, whether they are in the form of engine manufacturers or team sponsors, whether they are involved in car racing or other types of sports and so forth. I don't think anybody is happy with the current state of television viewership including CART. It's a big problem. Declining television viewership is a problem that not only affects auto racing but sports in general. Depending on the poles you look at and the surveys that are taken, even the NFL and the National Hockey League are suffering in terms of ratings. I think the key is can we all agree and come together and come up with some sort of concrete plan to improve those ratings and the exposure. The easiest thing to measure in regards to television is how many people are watching the show. Obviously another yardstick is the number of spectators at the events and the benefit you may get sponsoring the brand awareness and so forth . Television is very important, there's no questions about that." Clarke (Honda): "Basically I want to echo Steve and Les's comments. But beyond that it is very difficult to measure the value of exposure. It is even compounded by the quality of the coverage, not just that it is watched but that people actually getting anything out of the broadcast? I would say that Honda uses its internal resources to gauge the value or the quality of the broadcast, not just inside corporate Honda but inside the dealerships too. We host groups of dealers at basically every event which gives us an opportunity to interface with them, to hear, ask them what they are getting out of it, what they see the value of CART racing as it gives us feedback from a captive audience." Scott (Ford): "Television is obviously important but we are also looking at some other things that are important as far as media is concerned. There are over a hundred racing programs on TV every single week apart from the actual race broadcast when the cars are on the track. When you look at the coverage that we get from those programs, the internet, magazines, the papers etc., I think you will find that it is about equal to every other racing series there. I my opinion it is about equal in coverage to NASCAR from that perspective. I would say that, yes, the TV rating is less than what we want it to be but I think that's something that everybody is suffering from. Especially because we air the races on the weekends it interferes with people lifestyles. One other thing, along the same line as Robert's philosophy, we try to judge, aside from all of the technological advantages that the series offers, our dealers response and how they can effectively use the program and cascade it down to the showroom. That's where we make our sale. Over the past few years we have been benchmarking a lot of the consumer companies that are coming into racing. Most of you know that prior to 1990 most of the manufacturers in racing were primarily auto related companies. Since then there has been a tremendous influx of consumer related companies and these companies view racing a lot differently than we do and they are a lot more focused on how they use the program and go to market. So, we are trying to take advantage of some of the things that they are doing and it is clearly reaching and going out and touching the consumer at the point of sale."
Scott (Ford): "There is no question, we have stated many times that we want to make this thing happen. From a manufacturers' perspective, all of us involved in the sponsors council support this and want to do everything we can to make this happen. It has to happen because this is one of the best racing series in the world and NASCAR and Formula One are at Indianapolis now so without question we all need to be there." Clarke (Honda): "I think the only thing that I have to add is that their series would benefit from joining operations and I think that is key that both sides recognize that they have weaknesses than can benefit from working together." Potter (Mercedes): "It was clear in 1996 that there wouldn't be a reconciliation unless both sides critical issues were addressed. The other side of that is that both sides have to want a reconciliation and will probably have to make some sacrifices and give up some things of significant value for this thing to work. Discussions are taking place and if there is to be a reconciliation it probably wouldn't happen as quickly as everyone may want. At the end of the day there is not much point of coming back together if the series is not going to work. And there are fairly dispert but sincerely held opinions about these things and there is going to be a lot of work to make this happen. But, the original question as I recall it, and I think I speak for all of us, to have one series and be able to compete at premier open wheel racing in the United States is definitely a plus. There isn't one of us that wouldn't like to see that happen. But it has to work for everyone. It's got to work for CART and it has got to work for the Indianapolis Motor Speedway or it is not going to happen."
Mike Zizzo (CART): "Steve, to follow up regarding CART. Since 1996 we have restructured our organization to address those concerns. We have a vice president of television and a full marketing staff as well." Potter (Mercedes): "If I can add something to that, television is certainly important but sometimes it seems that the illusion is all it is is a TV show. Sam eluded to the fact, and I think this is critical, that there are ways that all of us leverage our involvement here. It's a simple mathematical fact that every time that one more channel is added to the average American household that the average rating for a TV show is going to go down . We are all going to live with decreasing overall television ratings. But we are also going to live with much ramped up interaction with the internet. Marketers are looking more and more at dealing with individuals more than a group. Television is a mass medium, but, if you are selling a high tech consumer durable, the trend is talking to individual consumers and television is a pretty poor way of doing that. So, television is something that we are all concerned about, we all want more ratings rather than less, but when we look out at the long term, television becomes less and less salient. It will never be unimportant, but the other channels that we speak to and interact with customers will become more important. Television is becoming less of a determining issue." Unger (Toyota): "If I can just add something. I think when you look at perhaps Toyota's involvement in motorsport, and perhaps the same for Ford, Honda and Mercedes, it is a form of advertising. You can advertise in television, billboards and newspapers and/or if you want to enhance your brand image are there other ways to do that. One of the ways you do that is going out in front of the public. In some ways it does a better job of representing your company to that audience than perhaps an ad. You turn things on and turn things off, glance over things but when you are out there competing real time in front of spectators and in front of a TV audience, there is an awareness there and an enhancement there in terms of the brand. You bring that brand down to a certain geographic area, to a certain group of dealers, through other sponsors through a business to business relationship it allows you to focus on certain segments of the public geographically and demographically. Television is important but it is not the singular focus of marketing as it was ten years ago or twenty years ago."
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