The Story Behind MoneyGram’s Grand Entrance into Sponsorship
Talking with podcast host Jim Andrews, David explores the what, how and why behind the P2P payments company’s decision to jump into sports partnerships with a title sponsorship of the Haas Formula 1 team, including objectives, activation and measurement plans. Below are edited highlights of the conversation.
Jim: When the announcement was made back in the fall that MoneyGram was going to be the title sponsor of the Haas F1 team, all I could think about was, “That’s going zero to sixty—or in this case—zero to 200–really quickly,” since aside from a hometown partnership with FC Dallas, MoneyGram hasn’t been on the radar as a sponsor. What’s the backstory on this deal? What’s the strategy and what are the objectives?
David: Part of why we feel it makes sense is exactly what you just said. We are not a company that has thrown around sponsorship dollars or tried to acquire everything. Something was going to have to be right and at the right time. And that’s what happened here.
We have a great partnership with FC Dallas, which is more of a hometown play. But this was a case of the right opportunity and the right time meeting together with the right team to move this forward. Your listeners know the growing popularity of Formula 1 around the world and certainly here in the United States—driven somewhat by the Drive to Survive phenomenon, of course.
But it wasn’t as though there was a yearslong effort to go out and say, “We need a sponsorship.” My philosophy, and you may share this, is that getting a sponsorship is never an actual objective. It’s more, “What can we do.” The company was going through a transformation and one of my big tenets of sponsorship is that it can and should do a couple of things, and one of those is really define a brand or enhance the brand, its personality, its image and just really define what it’s all about.
We are changing. We are becoming much more of a fintech-based company. We now have approaching 50 percent of our transactions being made digitally, rather than retail. We want that to grow. We feel we are the fastest way to move money around the world and Formula One is certainly the sport that speaks to speed and innovation really well.
But it goes beyond that. We felt if we were going to make a statement and really say, “This is what the new MoneyGram is all about,” and build a stronger global presence to be able to communicate those things and also explain things like we’re a relatable company, we had to pick the right team and we had to go at that title level or it wouldn’t have made sense.
Now does that mean that we may not do any other sponsorships? We will see if there are other things that make sense for us to pursue. Certainly other sports have a global vibe to them. But the beautiful thing about F1, as with other racing series, is that the field all competes together on the same day, and you are there on a global basis and every eye that’s following that sport is on you.
Jim: I think it’s really interesting that MoneyGram would not have taken a lower position; that you needed the team title position. Can you talk about why that was necessary?
David: It just made more sense to do that because then we are we are a part of the team. We are the MoneyGram Haas F1 team, and while there were some other opportunities being looked at that weren’t necessarily titles, the fit with being able to partner and say we are the same level as the team really meant something to us. It was a way to rally our entire system around supporting it and it was key to our messaging.
You know there are other teams on the grid that are huge in their following. With the digital reach that F1 is getting right now and how successful Liberty Media and F1 have been at building that engagement with fans, it’s really massive. We just felt that we had the opportunity with this particular team to make it all work where we could get that level of collaboration.
And it really has been absolutely a blast working with this team. Their social people are fantastic, the design people that we collaborated with on the logo and the car have been just tremendous to work with, so it really does feel like it’s a partnership, rather than just something that we are slapping our name on and hoping we reap the benefits.
Jim: I love origin stories of partnerships and how they came about, so how long were you working with MoneyGram as a consultant helping them to try to figure out this whole sports marketing puzzle?
David: Not all that long. I came on in late summer of last year. The deal was announced at COTA in Austin on October 20. I had been working for several months in advance of that with a fantastic internal team of people that were just so fired up to make this thing work. I embedded with them, which is the way I did my business at Deep Alliance in the last several years, where I just became an extension of the management team.
It was an absolutely unbelievable consulting project and then after the Austin race, and the announcement, I sat with Greg Hall, MoneyGram’s CMO, and we discussed the possibility of my coming on and a month or so later that’s where I landed.
Jim: Understanding MoneyGram is a global company, how important, if at all, was it that F1’s popularity has grown so much in the U.S. and that we will have three races here this year?
David: It certainly was a factor. What also was somewhat of a factor was that Haas, which entered the sport in 2016, is U.S. based. But it’s not an overriding factor. Look at our drivers: Kevin Magnussen is from Denmark and Nico Hulkenberg is from Germany. Guenther Steiner is our team principal and maybe one of the most charismatic people I have ever been around—in an odd way, in a bizarre way, but a wonderfully endearing way! He is an American now; he lives near the Kannapolis headquarters of the company, but obviously has European roots.
So it was a bit of a factor, but we serve over 200 countries and while the U.S. is a huge market for us in terms of where money is being sent from, it’s not the only market. Greg Hall likes to say every race is a home race for us. There are some markets where we have a stronger digital presence under the MoneyGram brand and other markets where we do more partnerships with other companies; where we provide services for them and they are the face of the brand, so it’s different around the world.
A lot of people know me from my time as director of U.S. sports alliances for McDonald’s. MoneyGram has over 400,000 points of presence around the world, which actually exceeds some of the QSR chains combined. That’s still a part of our business and it’s the history of the business, where people can go into a kiosk at a convenience store or retailer and send money cross-border, have it exchanged and have it appear very fast to the people that they care about in another country. As we move more digitally, obviously we’ll be looking to expand that brand and we believe that the partnership with F1 will help us build that presence to where it becomes acceptable when we do launch more MoneyGram Online or digital markets for the brand
Jim: Is there a specific target audience you’re going for? I’m guessing it’s a younger audience.
David: With the digital product, obviously you’re always looking a bit younger. We know that the F1 audience is almost surprisingly young, in a positive way, and they tend to be people that from a fintech standpoint are a lot more comfortable with doing their banking-related financial transactions online or on their phone. So that is absolutely a direction that we’re looking to push. It’s also people that have a little more of a global feel and who want to live their life a little more borderless when it comes to their contacts with other people from around the world and their need to send money to other places around the world.
Jim: You’re creating a sponsorship program from scratch, essentially. Organizationally, what does that look like? Are you building an internal team? Working with agency and vendor partners?
David: I am the head of global sponsorships, which means I oversee this sponsorship relationship and help work within a team that is responsible for other line functions, if you will, in terms of delivering the marketing.
I’m not an island. The marketing of the program doesn’t fall necessarily in the sponsorships group or just on me. We have a global head of brand who is very involved in this as we’re shifting our brand image and doing it along with F1.
We have a head of communications who I work with extremely closely on how we’re going to message, where we’re going to message, what are the projects that are important for us to establish the identity of what this team is and what our sponsorship is about.
We have a lead on social media who is engaged in working with the race team social group to make sure that we’re taking advantage of everything, as well as not breaking F1 rules in terms of what can be shown from the paddock as far as video goes!
We have a marketing operations person who helps make sure that the assets we need are able to be put in place, and we have a network of regional leads and regional marketing people who are super excited about getting involved. So when we go to Australia or we go to the U.K. or we go to Barcelona, we have programs that we develop with them based on what’s important to them. We are really excited about things that we’re going to be able to do locally on the ground in our key markets, our key MoneyGram Online markets.
We are also excited about what we’re able to do on a broader basis, because we have millions of people that are using our app regularly So what are the things that we’re going to be able to drive into that in terms of content, in terms of contests and so forth. So we are going to hit it on a couple of different fronts. There’s a lot of work in front of us to form this circle around this property and make sure that we’re maximizing the value from it.
Jim: As you and I are recording this, the season hasn’t even gotten underway, so this is obviously a work in progress, but beyond the association with attributes such as speed, high-tech, forward-thinking, are there specific activations planned? Are you ready to talk about some of the specifics regarding how you will use the partnership to tell the MoneyGram story?
David: No! But I will tell you the strategy that we are going to pursue. There are four parts to it and one is this concept of unique engagement–things that we can bring to people, to our customers, that others can’t. We are going to definitely lean into that and make sure we’re creating some unique content and unique engagement pieces.
We are looking at a first-year concept that will probably be only U.S.-based, which involves people following the series and being able to access certain things in conjunction with the app.
We will look to on-site activation in key markets, which could be in concert with some media partnerships, which helps us expand what we’re trying to do. We will have a physical presence, but one that doesn’t entail building a museum to ourselves and expecting people to come see it. It will engage with people in ways they would normally go about their business. For instance, we were very excited about what we did in Austin, where we took over a coffee shop as part of the coffee culture of Austin. I’m not saying we will repeat that in any other market, but the idea is to try to be as local as we can, but do things in ways that can be amplified on not just a country or region basis but possibly globally through PR and through social as well.
We have to be efficient. We’re not budgeted as some of the bigger sponsors, so everything we do has to be smart. We have to look at it in terms of can it help us achieve what we want to achieve and do so in an efficient way, not only reaching those people that we’re touching live in person and drawing them into our app, but helping us fulfill our engagement goals, which are very aggressive. We are going to take an always-on approach to the partnership, meaning that there’s always going to be something going on in one way or another, whether there’s a race weekend or not.
The last piece is in those markets where we don’t have a branded presence, and that is how can we bring in partners that we’re doing business with? I won’t go into all the details, but even in the markets that kick off the season in the Middle East, in Bahrain and then in Saudi Arabia, we are looking to work with some partners. We are going to have the only show car at the Beyon Money F1 Fan Village in Bahrain, which is run by the Bahrain International Circuit. It’s exciting because we have one hell of a cool new car design that we’re super excited about, and the fans seem to be as well
Jim: I’ve seen the pictures. The car looks great. Beyond bringing in those partners, the Formula One paddock is such a great area for client entertainment and hospitality. Will you incorporate a B2B element?
David: There will be a degree of B2B in certain markets, where we will have paddock club tickets where our regional people can do entertaining, or we can give to them to use as they want based on the business that we’re doing with them. But that’s an interesting point, because even Drive to Survive, in my personal opinion, spends too much time in the paddock. The image of F1 is super upscale, and that’s fine. It’s an expensive sport to be involved in, an expensive sport to go to. I’m sure you’ve seen the pricing for the inaugural event in Vegas in November.
But our goal isn’t to focus on that. We are much more of a B2C company. Those are the fans that we want to bring into F1 through our team and our partnership. We are looking to be the more relatable, accessible team.
That goes back to what I was saying about the race team. If you follow the series or you follow the sport, you know our team, our team principal, our drivers and the storylines behind the team—it’s a pretty relatable group of people. We like that because we feel that we’re the same type of group. We’re going to hustle our ass off. We are going to work hard. We are very human in our dealings with people and relatable.
The MoneyGram Haas F1 team is not the largest team, but that’s part of the beauty of it—how they work together and why it’s so much fun to be a part of them. The vibe right now is just really great. They have had some hard luck stories with two sponsors in the past. Hopefully we are bringing some great stability and enthusiasm and excitement. We are not here to dictate who the driver should be or get involved in that side of the business. We trust the organization to do that. We trust Guenther to do that. Our job is to support them on that side and get out and market it, hopefully bring some fans to them but at the same time get some people much more interested in what MoneyGram is all about.
Jim: You’re right. We talk so much about F1 and the lifestyle and the imagery and everything’s aspirational, and then on the track you’ve got the major teams and the glitz and the glamour and the power and the legacy that goes with them, but there’s room for an underdog story. In my perspective, that’s been missing. People want to root for an underdog!
David: Last year, after MoneyGram announced this partnership, Kevin Magnussen finished in the points at the U.S. Grand Prix at COTA. Two races later, in Brazil, he won the pole, which was unprecedented. It was voted by one panel as the best moment of the year. Think about that. Max (Verstappen) wins his second championship. There’s all the drama between the Ferraris, Red Bull and Mercedes. And Kevin Magnussen winning a pole in Brazil was that moment. There was no doubt that it was a feel-good moment not just for this particular race team, but for the entire paddock and the sport.
Beyond that, if you look at what happens at Monza, for instance, after a race, the scene of everybody—most of them waving Ferrari flags—coming down the stretch. Those are fans that are there spending their hard-earned money to be part of this exciting experience They are not people that are going to be hanging out in the paddock club or walking the paddock. They are great sports fans and they are great racing fans and they come from all walks of life.
Jim: You touched on this a little bit when you mentioned some engagement goals, and I’m always interested in in evaluation and measurement, so what is success going to look like for you? At the end of the season how are you going to determine whether this was the right thing to do?
David: There are a couple of things from an overall marketing standpoint that we are looking at very closely. First, growing our brand recognition and our preference amid more competition on a digital basis than had been there just several years ago. As we are making that transformation, we have new competitors that we are making sure we benchmark against and look at what our growth is.
Then there is the actual engagement with the brand through things like social and bringing them into the app. We are going to be looking at whether we are able to bring people into our ecosystem and growing that in a positive direction.
On a very general basis, we hope and expect to be able to showcase our brand and we’re going to be able to look at that type of engagement by people coming into the app and also engaging with us in in the various other channels that we have. And those goals will obviously shift as we move through the life cycle of the partnership.
Jim: On a personal level, how has the transition been, going back to a full-time corporate role after so many years as an independent consultant?
David: It’s been great. I had two stints with Deep Alliance, wrapped around two years at Van Wagner. Those were amazing years; I was always proud not only of the company, but of the clients we kept and worked with.
It is a change, there’s no doubt about it, but the opportunity and the timing really just seemed to work. As great as it is to come into F1 at an exciting time and the idea of being in charge of managing the promotion for this great company that has been around a long time and is going through this great change, if it hadn’t have been for the experience that I had working with this team around the Austin launch it would have just been a great consulting project.
That experience was the thing that made me so excited and keeps me excited about it every day. Because of the time zones we are dealing with right now, it’s been pretty unbelievable the last couple of months as we’re preparing for the season. It’s tough, but everybody’s so passionate and everybody just really wants to make a difference and everybody is putting their best foot forward. That was the thing that really made it absolutely the right decision. I couldn’t be happier about being with this team of people, with the management of the company and with where we have an opportunity to go.