Friday, October 23, 2009

IndyCar Marketing: Jobs of the Whole Product

This is an important crossroads in the New Day Rising Project for IndyCar racing. We are ready to commence discussion of our Marketing Plan. My purpose in writing this article is to provide a framework within which we might consider the issues regarding Product, Place, Price and Promotion.

In addition to the 4 Ps model, I plan to use "whole product" and "jobs-based" approaches to Product Development, Channel (Place) Selection, Pricing Considerations, and Promotional Strategy.

The Whole Product Concept

This Whole Product approach to product development is the brainchild of technology marketing guru Regis McKenna.
Recall the days when personal computers were little more than glorified word processors. That core product - the PC - remains today much as it was back then, albeit with increased and accelerated processing capabilities.
The early PC was disruptive technology insofar as it effectively eliminated the market for electric typewriters. Some suspected that handheld calculators might also be threatened. But that, really, was it.

Connectivity proved to be far more disruptive. Networked PCs provide a good example of a whole product. They would not be possible if not for the core product, the personal computer. But they are much more than mere word processors and calculators.
Connected PCs have disrupted myriad industries: travel agents, television networks, newspapers, bookstores, photo film manufacturers, and many more. Networked PCs continue to disrupt new and diverse markets because they afford consumers and businesses an ever expanding range of attributes and capabilities.

The whole product is the sum of all of those product attributes that increase the value that accrues to customers.

Product "Jobs"

This concept originated with Professor Clayton Christensen of Harvard Business School. It is the subject of my IndyCar Maxim #4. Let us again use the PC as our example.

Previously, we recalled that early PCs were little more than word processors and calculators. Think of all of the "jobs" that we can "get done" today, thanks to the whole product that is the networked personal computer. Think of the various industries that have been disrupted - music and video retailers, photo finishers, pornography publishers, the U.S. Post Office - because a better alternative is now available via the PC.

The PC whole product empowers users to get lots of jobs done.

IndyCar: Trade offs Required

Selecting the optimal combination of attributes for incorporation into the IndyCar racing whole product is paramount to our task. It is also likely to be a challenging and, at times, frustrating proposition.

The PC is fairly thought to be a Utopian whole product because it is capable of doing different jobs for different users at different times. For example, it is entirely conceivable that one PC might be used as a substitute for both Hustler magazine and the land line phone that the kids used to call Grandma. However, that PC is unlikely to be used for both "jobs" at the same time. Personal computers offer users a flexible, either/or job orientation.

The IRL is not so fortunate. Racing is temporal - it must occur at specific times and in specific places. Years ago, one might not have been surprised to see Grandma sitting next to a guy reading Hustler at the Indianapolis 500. But those days have gradually faded away as consumers of all types have been afforded more and better alternatives. Such is the nature of market competition in the digital age.

Therefore, we must: 1) identify an attractive market, 2) determine the jobs that individuals in that market want to get done and 3) develop an IndyCar whole product that is unequaled with regards to helping customers get those jobs done.

Market selection is Job #1. Our target market will have little to do with demographic categories. Instead, we shall seek individuals who are looking to get the similar "jobs" done.


Marlboro Tix Nix: Another Drag on IndyCar

Perhaps we now know why Richmond is not on the 2010 IndyCar schedule.

According to Curt Cavin of the Indianapolis Star, Phillip Morris USA will not continue its free ticket voucher program at IndyCar races in 2010.

No wonder Terry Angstadt has become so fond of promoters that are subsidized by governments.

It is difficult to imagine that IndyCar will return to Kansas Speedway after 2010 unless more than 50,000 Middle Americans suddenly determine that what they really want to watch at the Kansas oval is an international road racing series. The Kansas IndyCar race was supported not only by the Marlboro ticket program, but also by NASCAR fans who were forced to buy bundled tickets.

Now, both subsidies are gone.

Phillip Morris USA will continue to sponsor Team Penske - for 2010, at least. But perhaps we now are better able to understand why Tim Cindric has become so keen to bring star NASCAR drivers to Indy next year in order to increase television ratings.


Thursday, October 22, 2009

Working Mission Statement

Enough, already! We have bandied back and forth, to and fro, so that we might devise a Mission Statement for a revamped IndyCar Series. It is clear to me that we must arrive at a consensus with regards to multiple key issues before we can clearly define our Mission.

Therefore, let us use GreyMouser's 3-sentence adaptation of the original submissions from Citizen John and TC.

(Working) Mission Statement

1. We are committed to working with our partners to provide a superior auto racing product for the avid and casual fan alike that is compelling, entertaining and fun to watch.

2. We are committed to providing leadership that allows competitors to test new technologies and refined applications to answer the challenges of the 21st Century and beyond.

3. Every interaction a fan or partner has with our organization must be exciting, enjoyable and memorable.

Product Development Preparation

We shall use the Working Mission Statement above to organize development of our Marketing Plan. The 4 Ps model - Product, Place, Price, Promotion (in that order) - will lend structure to our Plan.

After we establish plans for each of the four Ps, we will return to the Mission Statement. Please note that the first P, Product, will likely require a good deal of time and consideration. The IndyCar product is much more than cars and engines.

Before we commence the process of Product Development, I ask that you go back and read the following Maxims. Each considers an argument regarding product development. I admit that my various positions tend to fluctuate and are often contradictory with one another.

Maxim #5

Maxim #2

Maxim #1

Maxim #4

Maxim #6

I will introduce our first Product Development issue in the next entry.


Wednesday, October 21, 2009

IndyCar: IRL US F2000 Series Misses the Mark

It is no secret that Tony Cotman wants to revamp the IndyCar ladder system. To that end, Andersen Promotions, an offshoot of Andersen Racing, is planning to add a retooled U.S. F2000 National Championship to the 2010 schedule. The Indy Racing League will sanction the new entry-level series.
You can read the entire story at Racer.

My criticism has little to do with the US F2000 announcement. In that regard, I have only two relatively minor concerns.

The first is that drivers who are not yet 18 years old would seem to be natural targets for the new series but for the presence of Phillip Morris USA. Because the marketer of Marlboro participates in the IRL, drivers who are not yet legal adults are not permitted to drive in IRL sanctioned events. That one of the IRL's biggest sponsors works against the interests of the new entry level series strikes me as being a bit odd.

Second, I wish that F2000 would embrace ovals. Racer reports that two ovals are under consideration for 2010, but that most if not all of the schedule will be composed of road and street races. Is this supposed to be a proving ground for drivers who wish to participate in the Indianapolis 500? I guess not.

Another Bottleneck

One can sense that IRL management is trying to attract young American drivers who might some day revive the IndyCar Series. For this, I commend Angstadt, Barnhart and Cotman.

However, I would also suggest that the new Indy Lights feeder series will do little if anything to actually solve the problem. There are and have been plenty of talented young Americans who would have liked to have been IndyCar drivers. That they did not achieve their dreams is not due to a lack of viable feeder series.

Drivers such as Robbie Pecorari, Cole Morgan, and Kevin Swindell fell from the IndyCar ladder because the cost of operating a team at the top rung is five times greater than that team's market value. Put another way, if the IndyCar Series can not afford to keep 2004 Indianapolis 500 Champion Buddy Rice, then it can not afford to attract Pecorari, Morgan and Swindell.

The new U.S. F2000 National Championship might become a fine lower level formula championship. Regrettably, it is also likely to create yet another bottleneck of drivers whose accomplishments warrant an upgrade in competition that their personal resources and connections can not purchase.


Thinking IndyCar Innovation

Many of us believe that Innovation should have a role in the Mission of IndyCar racing. The details will require compromise.

Let us examine our proposed Mission Statement, courtesy of Citizen John.

Mission Statement

IndyCar exists to provide a superior auto racing product for the avid and casual fan alike that is compelling, entertaining and fun to watch. IndyCar is committed to making every interaction a fan has with IndyCar an exciting, enjoyable and memorable experience.

Innovation & Leadership: Comments and Suggestions

Mr. Cooper

"The role of leadership in testing automotive technology is essential. It is part of the value of the brand dating back to Carl Fisher. Without it, your Mission Statement would have no teeth. It is not unique in the marketplace. If it is not more than entertaining - which it needs to be - it is a drop in the sea with nothing special to merit attention."

Mr. Cooper suggests that we add to the Mission Statement, "...provides leadership in testing 21st Century automotive solutions."

Citizen John

"I'm having a hard time translating innovation into increased fan interest. Sure, there would be some interest, but as to substantial interest 'because of' innovation, I don't know. Fan interest in sports seems to center around skill and strategy of the participants... how many people will watch IndyCar 'because' it is the leader in testing automotive solutions for 21st Century needs?"

Dave NJ

"This is great in theory, but it seems to me that the tech challenges for transportation in the 21st Century are about energy efficiency. It certainly isn't speed and power, except within the constraints of energy efficiency. I'm not convinced that you can create a compelling racing product around what amounts to a fuel economy run."

BC has suggested that we "uphold the heritage" of the Indy 500, which he believes would provide an implicit tip of the cap to "a strong tradition of innovation."


"Since every era brings new ideas, 'innovation' means not only new ideas, but also adapting to and improving the ideas that are already available."


"Innovation will always initially be limited to the race track early on and then move from there with public demand and interest, assuming that you have a testing ground for that sort of thing. Nothing wrong with that."

GreyMouser noted that he likes the idea of adding innovation to the Mission Statement because it would provide IndyCar a clear point of product differentiation with regards to NASCAR. He also believes that innovation would provide IndyCar a market space to which no other sanctioning body has laid claim.

Roggespierre's Review

I tend to believe that Innovation must be central to our Mission. Like new contributor IndyIan, I also believe that innovation must evolve from the lowest points on the supply chain. This might enable IndyCar teams to augment their own brands in the marketplace. Ultimately, that would be a good thing for IndyCar racing.

Mr. Cooper's word, "leadership," is, I think, an underrated and essential element of his suggestion. IndyCar lacks identity at present in part because it does not lead the auto racing market in any area.

Furthermore, I do believe that energy efficiency and fuel consumption can be made to be both interesting and entertaining. This issue is one that I fully intend to discuss thoroughly when we consider our "whole product" offering.

Request for Proposals

So, allow me to issue an RFP to all readers of and contributors to The Indy Idea. Please submit the language that you would use in the Mission Statement to denote Leadership in Relevant Automotive Innovation.

We shall then discuss and determine the optimal solution for the time being. Rest assured that we will revisit the Mission Statement after we complete the Product phase of our Marketing Plan.


Monday, October 19, 2009

Slogging toward a New IndyCar Mission

Conventional wisdom holds that somebody once said that it is easier to tear down than to build up.

That guy was right.

After much discussion, disagreement and digression, we still have not established a Mission Statement that might bring about a New Day Rising in IndyCar racing.

Our most comprehensive effort to date came from the keypad of Citizen John. Let us review his submission.

"IndyCar exists to provide a superior auto racing product for the avid and casual fan alike that is compelling, entertaining and fun to watch. IndyCar is committed to making every interaction a fan has with IndyCar an exciting, enjoyable and memorable experience."

Recall that the Mission Statement should explain why the firm should exist. More specifically, it should broadly state what the organization must do consistently if it is to achieve its Vision. Our Vision Statement is below.

"IndyCar shall be the clear number-one choice among auto racing consumers in the United States. At its core is the Indianapolis 500, an iconic American institution that shall transcend the sport of racing and be a worldwide automotive celebration."

Can we assume that if we were to achieve the Mission that John has proposed, we could then expect IndyCar to become "the number-one choice among auto racing consumers in the United States?"

I am skeptical. I believe that IndyCar must do more. For example, I like the addition that was proposed by Mr. Cooper.

"...leadership in testing automotive solutions for 21st Century needs."

This might lend relevance and technological intrigue to IndyCar racing that would differentiate it from NASCAR. Here, we could rearrange the playing field, adding real significance to the product so that we might avoid competing head-to-head with NASCAR in the racingtainment market. Innovation also speaks to our Vision of the Indy 500 transcending the sport to become a worldwide automotive celebration.

BC wrote that IndyCar should 1) serve fans and 2) "honor and build upon the heritage" of the Indy 500 and championship racing. I think that Mr. Cooper's suggestion would help us to accomplish both of those tasks.

Ground Rules

I think that we are close to resolution. However, certain asides continue to foil our efforts. Therefore, as we attempt to finalize our Mission Statement, let us not raise any one of the following subjects.
  1. The name of either the series or the sanctioning body
  2. Specific attributes of the cars, drivers and tracks
  3. Costs

We will discuss each of those issues and many more in due time.

For now, let us consider Citizen John's proposed Mission Statement. Does it contain redundancies that should be eliminated? Have we omitted anything that is essential to IndyCar's existence?

Let's get moving and wrap this up.