Mexican Esteban Gutiérrez dedicated 15 years of his life to being a Formula 1 driver. However, he soon took a new direction towards business. “Just as I am passionate about racing, (I am also) passionate about business,” he says.
Gutiérrez found a window of opportunity to start a business, as he remembers that, when he was a driver, people asked him where they could get official Formula 1 merchandising (promotional merchandise), something he did not know how to answer.
With that in mind and with the boom that motor sport has had, in 2021, Esteban founded EDASI (now DRIVER 1), an online retail platform dedicated to Formula 1 for Mexico and Latin America.
And Esteban Gutiérrez knows well about the passion for Formula 1. At the age of 16, the Mexican was recognized as Formula BMW Rookie of the Year in 2007. In 2013, he competed at the Formula 1 World Championship level and made his appearance in the Mexican Grand Prix, in 2016.
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At the time, Checo Pérez and Esteban Gutiérrez were considered the most promising drivers in automotive sport. In 2019, the motorsport professional joined Mercedes as a development driver and competes six times a year, representing Mercedes in Formula 1 and the Inter Europol Competition team in the World Endurance Championship.
The new path: undertake
Esteban explains that his idea was to offer official merchandise, since within F1 it was not important because it represented a minimum percentage of income, between 1% to 1.25%.
“When I started to see this new (business) strategy and this opportunity that represented a small percentage of revenue, my projection was that that was going to change substantially. Because? Because sports where they have massive audiences, such as football, the NFL, the percentage of income from merchandise is extremely high,” he says.
DRIVER 1 works as B2B (business to business) and as B2C (business to customer), to serve retailers, such as department stores and small and medium-sized stores, while in retail form it is served by ecommerce channels such as Mercado Libre, Liverpool, Walmart , Coppel, Amazon, among others.
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As well as having its own sales channel in which it also offers fans relevant content and information about the sport. “The creation of this new ecosystem has given us the opportunity to have significant digital growth, which represents between 20 and 30% of our (total) sales,” he says.
They currently offer more than 5,000 products and the average ticket varies between 1,400 to 1,800 pesos. The most popular products are related to the brands Ferrari, McLaren, Mercedes, Red Bull, Aston Martin, while the items highlight polo shirts and caps, and begin to venture into collectibles such as scale cars, scale helmets, which They are replicas.
One of the challenges they face is importing products because they pay high taxes and the time they take to arrive, since it took them between one month to two, now they are working on improving the efficiency of the operation, reducing that time to two to three. weeks, as well as ensuring that people can receive their purchases in 48 hours.
Today the percentage of merchandise is between 10 and 15%. “There is still a very high range of opportunity because there are sports, like soccer, (that) up to 40 or 50% of what the teams receive in income as a result of the engagement (commitment or loyalty) of the fans and buying the products. of merchandise,” he adds.
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In the case of Mexico, what has driven its interest and growth, Gutierrez explains, are Mexican drivers like him and Sergio “Checo” Pérez and the Mexican Grand Prix.
Its objective is to serve the two different markets that exist in the country: temporary or circumstantial fans, who are related to the Mexican GP and ‘Czech’; and another solid base is those who always look for products not only from the Mexican driver, but also from other teams.
“That base is the strongest and it is why we are building the business, to serve all these fans,” he mentions.
While in Mexico, and in front of the Grand Prix that took place in the country from October 25 to 27, they have started with physical stores. A first pop-up store in the Oasis Coyoacán plaza, in Mexico City. “We are starting with CDMX, which is where there is a lot of presence by the Mexican Grand Prix, however, we have plans to expand to the main states of the (Mexican) Republic.”
The rise of F1
Your business looks promising, as Formula 1 is experiencing an unprecedented moment. Although Esteban mentions that it has been a niche sport, he recognizes that after Liberty Media, an American media and entertainment company, acquired Formula 1 in January 2017, and a new commercial strategy was implemented, it has given it momentum in new audiences such as women and younger generations, as well as in different countries and markets.
According to the 2021 F1 World Fan Survey survey, conducted with 167,000 participants in 187 countries, by Motorsport Network in association with Formula 1 and Nielsen Sports, it showed several findings: the average age of fans decreased to 32 years, four less than what was reported in 2017, while female participation in the survey almost doubled, going from 10%, in 2017, to 18.3%.
Additionally, new younger audiences show growth in countries such as the United States (50%), India (55%), China (58%) and Mexico (45%) and indicated that they have been following the sport for less than five years.
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But F1 also captivates the smallest of homes. In the main European markets, the increase in child fans increased 17% year-on-year, going from 17.3 million to 20.1 million, according to a 2021 study carried out by The Insights Family. The above represents a growth more than that of soccer (6%).
Social networks have been an important clue to reach a larger audience. According to the same study, F1 is the second sport with the highest growth on these platforms, particularly on Instagram and TikTok, with a year-on-year increase of 36%, as fans, between 15 and 18 years old, look for the highlights. of the races, the content of the drivers and behind the scenes. As well as the Netflix documentary “Formula 1: Drive to Survive” that allowed the public to experience the sport more closely.
For Esteban, the future of F1 in Mexico is promising, but he believes that coordination is required between the different federations to invest in championships and infrastructure so that more drivers can excel and migrate to other international championships and continue representing Mexico.
While he does not plan to take his foot off the accelerator, he will continue with his passion for racing and the business. “I have been able to reinvent myself, from being a pilot to being an entrepreneur and doing it successfully with the great team I have.”
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