Why brands pay millions to put logos on F1 cars

The Singapore Grand Prix yesterday was so boring that my brain started wandering to bigger questions.

Lando was cruising in front. Nothing was happening. The race was so processional I started noticing the sponsors instead. Gemini on one car. Perplexity on another. AWS everywhere. My designer brain latched onto the branding while the actual racing put me to sleep.

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Why would Gemini pay millions to put their logo on an F1 car? I know about both products, use Gemini sometimes, but seeing them blur past at 320 km/h doesn't make me use them more. Same with AWS. These aren't brands trying to get discovered. Everyone already knows them.

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And then there's Visa and Mastercard fighting over logo placement. They're literal payment network monopolies. Who actually chooses between those? When was the last time someone said "I really prefer Visa's brand aesthetic so I'll only use Visa cards"?

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The race stayed boring but the question got interesting. I researched the entire F1 sponsorship market to figure out what's actually happening here.

Turns out there's a whole parallel universe of marketing that has nothing to do with people like me watching on TV.

The two-tier reality of F1 sponsorship

After analyzing 200+ partnerships across all teams, the pattern became clear. F1 sponsorship splits into two completely different games.

The first tier is wide audience reach, the one we actually see. Luxury watches, premium alcohol, hotels, and automotive brands paying to reach 1.6B TV viewers and 826M fans globally. They measure media value, brand lift, and sales uplift in race markets. Cost runs anywhere from $2M to over $100M per season.

Tag Heuer, Richard Mille, and IWC are selling $5K to $500K watches to high-net-worth F1 fans. Heineken spent $250M over five years for activations in 180+ countries. LVMH put down $1B over 10 years to get Moët, TAG Heuer, and Tiffany in front of the grid. These make sense. F1's median viewer household income is $100K+. If you're selling premium products to wealthy people who love technology and speed, this is your audience.

The second tier is paddock access, and this is the one that actually matters for companies like Perplexity. Cloud and AI companies, payment networks, cybersecurity firms, and enterprise software vendors aren't trying to reach viewers. They're paying $5-80M per season, mostly for hospitality access, to close deals with CFOs, CTOs, and banking partners in the Paddock Club. They measure B2B pipeline, signed contracts, and strategic partnerships.

Oracle and Red Bull aren't advertising to consumers. They're demonstrating cloud compute to enterprise buyers. AWS and Ferrari are using F1 as a reference architecture for cloud migration deals. Visa and Mastercard are negotiating co-brand exclusives with banks at hospitality events. Perplexity and Gemini are recruiting AI talent and closing enterprise licensing deals.

The actual ROI formula is simple. One major enterprise contract equals entire season sponsorship paid for.

Wait, so companies pay millions just for networking?

Yep. And I'm genuinely happy for the top executives whose companies spend $20-80M so they can hang out with top-tier food, premium alcohol, exotic cars, attractive people, and other rich executives laughing about deals while watching cars go vroom.

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No really, I respect it. That's just smart B2B sales at scale.

TransferMate, a payments platform, partnered with Haas F1 not to advertise to fans but to integrate their cross-border payment rails into the team's operations, then use that as a case study when pitching global enterprises in the Paddock Club.

CrowdStrike on Mercedes isn't targeting home users. They're in meetings with Fortune 500 CISOs who happen to be Mercedes guests. One signed SOC2 enterprise contract equals sponsorship justified.

Perplexity and Gemini aren't trying to get me to download an app. They're signaling "we're elite tier tech" for brand positioning among enterprises. They're recruiting AI engineers who watch F1. They're meeting with CTOs who might license their models for $500K to $5M deals. And probably I add points to Perplexity for that slay glitter Hamilton helmet haha.

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The logo on the car is basically an expensive business card that says "we're serious enough to be here."

The economics make zero sense until they do

Let's run the math on AWS. Estimated spend is $30-50M per season for their Ferrari partnership. TV viewers per race hit around 70M people. The number who will "discover" AWS? Approximately zero. The number of AWS migrations closed in Paddock Club? Probably 4-8 per season. Average enterprise cloud contract runs $5-50M over three years.

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One migration deal equals entire sponsorship paid for.

The logo is social proof. The real product is access to the room where 200 enterprise decision-makers gather 24 times per year.

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Why Visa and Mastercard fight over logo placement

Here's the thing I didn't understand. Consumers don't choose between Visa and Mastercard. But banks, airlines, and retailers do.

When Costco switched from Amex to Visa in 2016, that single deal represented billions in transaction volume. The decision wasn't made by shoppers. It was negotiated between Costco and Citi as issuer, with Visa.

F1 sponsorship gives payment networks negotiating leverage with issuers during co-brand renewals. It gives them access to banking partners at hospitality events. It provides regional market entry, especially in Middle East and Asia growth markets. It enables premium tier positioning where Infinite and World Elite cards get tied to F1 experiences.

They're not advertising to me. They're advertising to the 50 people who decide which network gets embedded in a neobank's infrastructure.

Who actually wins in F1 sponsorship?

After analyzing the full grid, here's who gets the best ROI.

Enterprise tech, cloud, and AI companies like Oracle, AWS, IBM, Google, and Perplexity have B2B deal cycles that justify the costs. Average sponsorship ROI hits 6 to 1 according to RTR Sports. One hyperscaler migration equals a $10-30M contract.

Luxury brands selling watches, champagne, and hotels match perfectly with F1's audience median income of $100K+. It's direct demographic alignment. RTR Sports data shows Nielsen measured a 10% purchase intent lift among F1 fans for luxury sponsors.

Fintech and payment networks are fighting for co-brand exclusives worth billions. Financial services went from 2% of F1 sponsorship in 2019 to 17% in 2024. Visa, Mastercard, and crypto exchanges all benefit from paddock access to decision-makers.

Cybersecurity companies like CrowdStrike and SentinelOne target CISOs at Fortune 500 companies. Hospitality access equals qualified pipeline. One enterprise security contract can run $5-20M.

On the flip side, small local brands struggle. Entry cost is $2M minimum for a tiny logo. Global distribution is required to justify reach. Commoditized B2C products have a hard time measuring attribution, and better CPM alternatives exist on YouTube and Meta. Early-stage startups burn money unless they're targeting enterprise or raising Series B+ from F1-adjacent VCs. That money is better spent on product.

When F1 sponsorship goes spectacularly wrong

Not every logo on a car leads to success. Sometimes brands burn millions and get literally nothing back. Here are two of my favorite disasters.

Jaguar's $300,000 diamond stunt at Monaco 2004

Jaguar F1 stuck a $250-300K diamond on the nose of their car for a Monaco Grand Prix promotion tied to Ocean's Twelve. The diamond fell off on the first lap. Nobody saw it. Zero exposure. Total loss. This is my personal favorite because it's just so perfectly stupid.

[image-jaguar-diamond]

The lesson here is obvious but apparently needed to be learned: don't attach expensive jewelry to cars going 320 km/h.

MasterCard Lola in 1997

MasterCard pushed Lola to enter F1 a year early. The team wasn't ready. The car didn't qualify for the first race. DNQ. The entire project collapsed after one attempt. MasterCard's logo got zero TV time because the car was too slow to even make the grid.

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Marketing budgets can't fix engineering problems. MasterCard learned this the expensive way.

The pattern is simple. F1 sponsorship is an investment that requires actual due diligence. You can't marketing-brain your way past fundamental problems like physics or having a functional business.

What B2C brands actually get

For brands targeting normal consumers, F1 impact is almost entirely vibes-based. The logos blur together at 200mph. What sticks is aesthetic moments, team loyalty, and storytelling. Netflix's Drive to Survive brought 360K+ new American fans who didn't watch before. That's content marketing that works.

Meanwhile in the Paddock Club, a CTO is signing a $40M cloud migration deal while barely watching the race.

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What this means if you're building a product

If you're a founder or designer wondering "should we sponsor F1?" here's the breakdown.

Don't do it if your ACV is under $100K, you're optimizing for CAC, or you measure success in app installs.

Consider it if you're selling to enterprises with ACV of $500K+, you need credibility signaling for fundraising, you want access to 200+ enterprise decision-makers 24 times per year, or your competitors are there and FOMO is real in enterprise sales.

Or just appreciate it as a spectator and focus your budget on product. Not every marketing channel needs to be your marketing channel.

The real lesson

F1 sponsorship taught me something about how B2B sales works at scale. The most expensive marketing often isn't marketing at all. It's sales infrastructure disguised as brand spend.

That $50M Oracle pays Red Bull isn't an ad buy. It's the cost of having a dedicated venue to close deals 24 times per year, with built-in conversation starters and social proof.

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The logo on the car? That's just the cover charge.

And honestly? I'm not mad about it. I get to watch beautiful glitter helmets and occasionally interesting racing. Oracle gets to close cloud deals. Red Bull gets to fund next year's aero development. Everyone wins.

Except the small local brands trying to compete for attention with a $2M logo the size of a sticky note. And Rich Energy, who managed to sponsor an entire F1 team with a fake company and a stolen logo. That's actually impressive in its own way.

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Did I miss anything about F1 sponsorship economics? Roast my takes on Twitter/X or LinkedIn.

P.S. If Perplexity is reading this and wants to send a glitter helmet my way, my DMs are open. I'm a designer. I appreciate good execution.