Rambling Thoughts On The BCG Report

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By now, most fans of the IZOD IndyCar Series have heard about the report of the Boston Consulting Group (BCG); the consulting firm hired by the Hulman & Company board last year to examine every aspect of INDYCAR and the Indianapolis Motor Speedway. They have released a 115-page report and there has been a multitude of opinions and analysis on many websites for the past several days. Curt Cavin and Kevin Lee also did a good job of dissecting it piece-by-piece last night on Trackside. I took some well-deserved time off from here on Monday, so by now it is old news. I won’t break down the report item by item; but I will offer my thoughts on a few points.

First of all, I was glad to see that BCG felt that the Hulman-George should not sell IMS or INDYCAR. I am a big believer that there needs to be an ownership connection between IMS and the series based around it. I also think that the traditions surrounding the Speedway are too important to its longtime fans, to be handed over to some conglomerate that cares only for the bottom line. The Hulman-George family has owned IMS for almost seventy years. While we may not agree on everything that has transpired over the last two decades, I am a strong proponent of leaving the facility in their hands.

I am also in agreement that the series needs to always be on one network. The question is – which one? The ESPN family of networks offers the greatest opportunity for visibility, but in the past – it has appeared that the series was not treated as a valued property. NBCSN has provided better coverage overall, but no one knows where to find them. The series has been locked into a long-term ten-year cable deal with NBCSN (Versus) since 2009. Although the production quality has been high, ratings have been abysmal – and falling.

BCG has determined that NBCSN may be in violation of their contract by carrying Formula One races this season. As much as I like the production of NBCSN and all of the on-air talent, I just don’t think they have the ability or desire to promote the races effectively enough to grow the series as quickly as needed. I’ve always said if the production of NBCSN could be carried over to the marketing machine of ESPN/ABC – the series could grow at a much quicker rate. With better talent in the booth (translated: dump Marty Reid) and an assurance that ESPN would promote INDYCAR with the same fervor as they do for the NBA, MLB or some of their other properties – there is no telling how the ratings would grow.

Another good idea was to reduce the Leader’s Circle payments to teams and redirect that money into larger purses. As Robin Miller said on Wind Tunnel Sunday night – the $35,000 purses for the winners are a joke. As Miller pointed out, the “start and park” cars in NASCAR earn more than that each week.

Some of BCG’s ideas sound like nothing more than the brainstorming session that Curt Cavin and Kevin Lee had on Trackside last week. One was the running of a second race at IMS in the fall on the road course. That was discussed at length here last Friday. The overwhelming response here and other sites has been that it is a bad idea.

Another idea that I don’t agree with is running a fifteen race season over nineteen weeks for races in the US, then an international series in the offseason. Bad idea. I’ve always argued that the IndyCar season should end on the Labor Day weekend, in order to avoid competing head-to-head with the NFL. They almost accomplished this last season by ending the season in mid-September at Fontana. But in order to do this, they need to start the season earlier than the last weekend in March – a lot earlier. Randy Bernard was in favor of starting the IndyCar season before the Daytona 500. I saw one person suggest that they run the week before Daytona. That’s not a bad idea – all they would be going up against would be regular season college basketball and Daytona qualifying

The problem with the current starting date is that NASCAR will be into its fifth race weekend and Formula One into its second by the time IndyCar gets going. The current offseason has seemed incredibly long. By the time the green flag drops in St. Petersburg, it will have been over six months since IndyCar turned a lap in competition. That is simply too long. By comparison, NASCAR’s offseason is barely three months. Running until a week before Thanksgiving then starting back in mid-February is a little extreme the other way, but the offseason needs to be shortened. Having a season that spans only nineteen weeks, means that there would be a thirty-three week offseason. As far as the international season in the offseason, would even the die-hards watch? In the middle of football season – I’m not so sure I would.

There also needs to be more US races – not fewer. The report indicated that the diversity of the tracks made the series attractive. Some translated this to mean that ovals didn’t matter. Baloney. I still think Randy Bernard’s goal of a 50-50 split between ovals and non-ovals was ideal. He had a long-term eye on reaching that goal when he was fired in October.

Then there is the item that has already been discussed at length – a playoff format similar to the "chase" now followed by NASCAR. The format suggested by BCG would be to hold twelve "regular season" races, followed by three "playoff" races – another bad idea. As Curt Cavin pointed out last night, season-ending drama and suspense is not IndyCar’s problem. Not since 2004 has a champion been crowned before the last race of the season. You have to wonder if any of these people were paying attention as IndyCar headed into the season-finale at Fontana. The situation did not lack drama.

There was one aspect that has been unpopular, that I don’t really have a problem with. Although my wallet wouldn’t be for it, it makes sense to raise ticket prices for the Indianapolis 500. Before moving across the track this year, I had seats in the Pit Road Terrace for ten years. In 2003, the seats cost $80 apiece. For 2013, the seats are still $80. What else costs the same today as it did ten years ago? I certainly wouldn’t blame the board or the Hulman-George family if they raised ticket prices significantly for 2014. I know the costs for running IMS is more today than in 2003.

The thing is – a consulting firm offers multiple suggestions and recommendations. They have no power to implement changes. Now, it would be foolish to spend $1.2 million to not follow any of their suggestions and blindly follow the same path that has led them to the current point of stagnation. That’s like hiring an attorney to guide you through a legal minefield and then ignoring every bit of advice they give you. Some of these ideas are good, some are at least worth considering and some are just plain asinine – like moving Long Beach to August. But the board and the Hulman-George family have the final say. I’m willing to wait to see their reaction and the path they choose, before piling on.

George Phillips

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11 Responses to “Rambling Thoughts On The BCG Report”

  1. A high dollar consulting group. Experts. Well, how can you consider dropping Iowa and Birmingham, but adding Boston? A 15 race season and a 3-race playoff with an additional 3-driver wildcard? Right. I like your take George and it didn’t cost IMS a dollar.

    • billytheskink Says:

      Could we really expect the Boston Consulting Group to NOT suggest adding a race in Boston?
      I just hope the idea was based on more than a feeling.

      • Simon Garfunkel Says:

        They probably just did that so they could have their peace of mind. No one could tell them to don’t look back.

  2. The one place you and I disagree is the seat pricing, and there only in the implementation. First, I have a problem with raising ANY ticket price by $60 when you’re trying to build attendance back to where it was is pure silliness. That is not to say that the Hulman George family isn’t entitled to some increase in pricing, but I would rather pass that on to the vistas and Penthouse on a gradual basis rather than charging $150 for a Paddock seat whose sightlines are significantly less appealing than before the F-1 construction. If you jump those lower deck Paddock seats to $150, you’re surely going to see a lot of fans cleverly disguided as empty seats on the main straightaway. In an email “mini-blog” I sent to Kevin Lee, I also suggested upping the price for Carb Day by $5, since that is now the primary ancillary event at IMS.

    Like you, I wish that NBCSN could get ratings to match the production values of their race telecasts. So far, the ratings have been bad and getting worse, and that’s before you add F-1 into the mix. My fear is that with ABC/ESPN how do you guarantee their performance in promoting IndyCar when they have a substantial investment in NASCAR, (both Cup and Nationwide.)

    One more thing: I get that we need the Leaders’ Circle program to keep some teams around for the full schedule. I would like to see it more performance – based however. (THe whole program reminds me of the attitude many take with kids today, the “Everyone Gets a Trophy” kind of thing.) Still, it’s better than the “Start and Park” fiasco that is prevalent in NASCAR.

  3. I think I understand why you put the word “Rambling” in your title. All over the place?

  4. Mike Silver Says:

    Many of the groups suggestions are naive at best. If the season ends in Indy, I think a race at the fairgrounds on dirt is the way to go, That would draw acrowd and add to the series’ diversity.

  5. Indycar would already run more races if they could find a venue willing to pay the fee. And Indycar would be with a better network if a better network wanted them. I do like bigger purse/lower team money. A playoff in Indycar is not necessary–their schedule is already about the length of the Nascar “playoffs.” They could just call the whole season a playoff.

  6. 提高门票价格吗?我将不得不提高自助餐的价格。采取特别关闭菜单。

  7. billytheskink Says:

    The $35,000 prize money number Miller throws out is a bit disingenuous, because it fails to acknowledge the Leaders Circle payouts as prize money and the fact that non-Leaders Circle entries also earn prize money.
    Last year’s $1.1-1.2 million Leaders Circle payment (I read conflicting reports) works out to $68,750 to $80,000 per race (I don’t recall if money was reduced due to China’s cancellation). The top-finishing non-Leaders Circle entry earned $80,000 per race. These figures are comparable to what a start-and-park NASCAR Cup entry would receive at every race but the Daytona 500 and Brickyard 400. A non-500 Indycar race winner earns well over $100,000 for a victory due to the $35,000 winners bonus. This is not to say that increasing prize money should not be a goal for Indycar as even the stingiest NASCAR Cup race still pays over $200,000 to the winner.

    In Miller’s SpeedTV.com piece on the BCG study, he again mentions the $35,000 figure and states that the 43rd place driver in NASCAR’s Cup series earned more than Indycar Champion Ryan Hunter-Reay last year.
    Taking the conservative $1.1 million figure and adding it to Hunter-Reay’s $546,680 in prize money earned from the 500 and from top 5 finish bonuses gives Ryan over $1.6 million in total prize money prior to the $1 million series champion bonus.
    NASCAR Cup’s 43rd place driver in 2012’s final standings was Michael Waltrip, who earned $429,362 for 4 starts. Even so, 41 NASCAR Cup drivers earned more than $1.6 million in 2012 (some were listed behind Waltrip in the standings, not scoring points because they were full-time in another NASCAR series). 33 earned more than the $2.6 million Hunter-Reay was tabbed to receive after his champion bonus. 18 Cup drivers earned more than $5 million, something I don’t believe any American open-wheel driver has done in a single season.

  8. Ballyhoo Says:

    I wish ESPN was a viable option for IndyCar. Their numerous channels are standard on most cable/satellite vendors. I had to go with DirecTV, so I could have Speed and Versus at a reasonable rate. I am concerned wtih IndyCar becoming the impoverished stepchild on NBCsports, now that they are carrying F1 (and a lot of it). With the demise of Speed by Fox in August, there are not a lot of options. Has anyone read or heard about the future of Wind Tunnel? I am not happy with its very limited time slot and duration this year, but am glad that WT has returned for another season.

    Oh, I too would vote a very loud NO on having a playoff. Last year and several before have gone down to the last race. Couldn’t ask for better entertainment.

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