An Interview With Grand Prix Association Of Long Beach President And CEO Jim Michaelian
Michael Gougis - Contributing Writer
April 09, 2013 – For the first time in the 39-year history of the Toyota Grand Prix of Long Beach, the sounds of racecars will echo through the streets at night. A special Formula Drift invitational is on the cards, thrilling spectators on Friday and Saturday night of race weekend.
And it’s included in the price of the ticket, no extra charge.
Jim Michaelian has been with the Grand Prix Association of Long Beach since
its inception in 1975. He became president and CEO on December 19, 1991.
(Photograph by the Business Journal’s Thomas McConville)
These things reflect the philosophy of the Grand Prix Association of Long Beach and of its president and CEO, Jim Michaelian. The philosophy is simple: Add to the value of a ticket into the event, and focus on what brings people through the gates.
“Our whole philosophy has been added value, creating additional events that add to the value for someone who has bought a ticket for that day,” Michaelian said in a recent interview. “Same concept as the concerts – we don’t charge extra for the concerts. You come, enjoy the day, end it with a concert, go to the drifting, or if there’s time do both! What’s important is that all these activities will be included in the ticket. One price gets you all.”
It’s a philosophy that has paid dividends throughout recent lean economic years. The Grand Prix has managed to hold onto its corporate sponsorship and maintain the size of its live audience, even as other forms of motorsport struggle to attract attention and even as IndyCar struggles with television ratings that are sometimes awful.
Evolving, adapting and updating the event is key to putting butts in the seats.
So this year includes several changes, including the Formula Drift contest on Friday and Saturday night.
“We’ve had drifting for six years now. Drifting has always been a very small part of our weekend because we had the cars attempting to drift all the way around the circuit and we had a limited amount of time – that’s not what their format is,” Michaelian said. “Their format is to conduct their events on a very condensed circuit area and have the cars perform their moves there. So we went to them and said, we’re not showcasing your product on our weekend – we’re not doing justice to the drifting, the concept.
“We said, let’s put on a two-night, night racing competition. And the way we’ll do it . . . is to have a 16-car invitational. We’ll put up a big chunk of money – a $25,000 purse – and we’ll take that time frame for Friday night practice and qualifying, Saturday night eliminations. And we’ll put it on the same course where they have their own competition the weekend before (a small portion of the full race track, close to the intersection of Shoreline Drive and Ocean Boulevard). And – most important of all – that portion of the course is an area that’s always been closed off to the public after the racing is over.
“So,” Michaelian continued, “for the public that wants to come down to Pine Avenue, to the restaurants, to the shops, to Shoreline Village, none of that is impeded at all. So our conducting this event has zero – I repeat, zero – impact on the ingress or egress to the area for anyone who wants to come down.”
While the Toyota Pro/Celebrity race will be looking for a new title sponsor in 2014, this year’s event promises to be more intense than in recent years. That’s because Toyota has stepped up with new Scion FR-S cars for the participants. Michaelian, a car guy to the core, smiled when he talked about the Scions.
“The rear-wheel-drive, two-door coupe, I’ll tell you what, it is a sexy-looking animal,” Michaelian said. “That is going to be one of the highlights of the weekend, seeing those cars in action. Different sound, different look, and to the drivers a different feel. This is much more of a driving experience than the front-wheel-drive cars they raced last year. Those were not as much fun to drive.”
This year’s race also will include, as the lunatics from Monty Python’s Flying Circus used to say, something completely different – off-road trucks. Former IndyCar and NASCAR and off-road star Robby Gordon is involved in a new series featuring 600-horsepower full-size trucks that go flying through the air at stadium dirt races. Gordon’s Stadium Super Trucks will do an exhibition event on Sunday, stomping around the Grand Prix course and catching big air on Shoreline Drive by launching themselves from ramps placed on the street.
“The sound of those trucks, those big V-8s – it’s gonna be amazing,” Michaelian said. “I’m going to hold my breath for 20 minutes and hope that nothing happens to the circuit – we’ve gotta run the IndyCar race right afterward!”
The rest of the event is the standard lineup of IndyCars, the American Le Mans Series sports cars, the Pirelli World Challenge GT cars – Audis, Porsches, Cadillacs and Volvos (Volvos? Seriously?) – rounded out by the Indy Lights contest for up-and-coming open-wheel stars.
The mix of cars, trucks, open-wheelers and drifters is deliberate, Michaelian said. There’s no mistaking what race is on the track, even for the most casual fan.
“You just keep running open-wheel cars here, and pretty soon everyone’s going to go, I’m bored to death. They all look the same,” Michaelian said. “This one’s got a 2000cc engine, this one’s got a 2600cc engine . . . That’s why you need a different look, a different sound, a different feel, identification – all those things are important.”
They are important in ensuring that fans keep showing up – and they have, with weekend totals in the 175,000 range, Michaelian said. That strong turnout is key to the economic net that supports the event. The corporate sponsors of the race don’t just pay a sponsorship fee, but they turn around and use their link to the GP to promote their own products. That leverage helps them and helps the GP at the same time.
“Activation,” as Michaelian described the concept. “We put together ticket deals with them. They have co-op deals with the Walmart’s of this world, with the 7-Eleven’s of this world, the AM-PM’s, so you walk in and you see a display that said buy a six-pack of Coke, buy a six-pack of Tecate, buy four Firestone tires and you get a free ticket. All of those things are reminders.
“The reason they’re important is that this (media) market, Southern California, is a monster. It is expensive. It is tough to make a dent in it. If we’re doing it (promotion) by ourselves, we don’t have enough money. But you put us together with Toyota, and with Coke, and with Firestone, and with Tecate, suddenly you’ve got – first, their budgets are bigger than our budgets. And you’re driving around and you hear an ad. That ad might not be our ad. But it’s a reminder that the Grand Prix is here. All of that helps us. Otherwise, we’d be lost. We’d be absolutely lost. (We) can’t buy enough (publicity). The budget isn’t big enough. You need multi-million-dollar budgets, or you’ve got people walking up to you and saying, ‘Do you advertise this event anymore?’ and you say, ‘I just spent hundreds of thousands of dollars on advertising!’ and they’ll tell you, ‘I never heard anything.’”
The biggest challenge facing the event, Michaelian said, is the dismal television ratings of IndyCar racing. The Port of Long Beach loves the fact that the race is broadcast in 160 countries. But the Port is unique in its publicity needs. For the other corporate sponsors, and for the television networks, the number of viewers in the U.S. is what matters. And right now, IndyCar is not delivering those viewers to television advertisers.
“The numbers are not where they need to be. Until you get to a certain critical mass, it’s tough to sell someone on being a series sponsor, because they look up and they go, what are your numbers? We have been fortunate. Most of our sponsors are aware that we have a huge presence in Southern California. That’s a big deal to them. They’re buying local exposure,” Michaelian said.
“But to a lot of sponsors who strictly value a relationship based on the number of eyeballs around the country, it makes it tougher. They send it to their agency, and their agency is told, evaluate this deal versus cycling, versus skiing, versus this and this and . . . And pretty soon (the agency) goes, whoa! These guys are delivering a few hundred thousand viewers, and these guys have got half a million, and these guys have got a million, and NASCAR’s got four million, and yeah it costs more but the cost per viewer, per this, per that – it makes a big difference.”
It’s not just a problem for NBC. It’s a problem for each and every team. Michaelian said IndyCar knows the problem, recognizes the challenge, and is committed to slowly re-building a solid television fan base.
“You got teams that are looking for numbers because the sides of the cars have got sponsors on them and the sponsors on those cars say, ‘How many people saw my car?’” Michaelian said. “To the promoter, to the team owners . . . how many eyeballs has significance. Promotion, marketing, TV coverage – that’s the series responsibility. You gotta have the numbers.
“There’s a new administration in charge of IndyCar, and they recognize it and they’re working on it. There’s no magic bullet. You’re not going to go from a 0.3 or a 0.4 (ratings share) to a 0.8 or a 1.0 like that. But what you can do is start to promote and market in a way that builds that audience, 100,000 at a time, perhaps. That starts to make a difference.”