PUMA's Sponsorship of Mercedes-Benz F1 Racing Team

This article discusses PUMA's partnership with Mercedes-Benz F1 Racing Team and their marketing objectives. It provides information on the assets used in the sponsorship and the activation strategies employed by PUMA. The article also highlights the demographics of Mercedes-Benz F1 Racing Team fans and the budget for rights and activation.

Mercedez-Benz F1 Racing
Team and Puma Design
Company

Table of Contents
Table of Contents.................................................................................................................................
Introduction..........................................................................................................................................
Main Body............................................................................................................................................
Info to subject sponsor.................................................................................................................
Understanding of objectives........................................................................................................
Info on the sports rights-holder and assets...................................................................................
PUMA’s marketing objectives.....................................................................................................
Budget for rights and activation...................................................................................................
Activation.....................................................................................................................................
Third Party agencies....................................................................................................................
Measurements..............................................................................................................................
Summary.............................................................................................................................................
References..........................................................................................................................................
Online.........................................................................................................................................

Introduction
PUMA is a German based multinational company that dedicate its products to athletes
and also deals in casual wear. The structure was founded by Rudolf Dassler in 1948, till date
it has its good reputation in marketplace and also have its customers all over the world. In
2019, company announced for a partnership with Mercedes-Benz F1 Racing Team and
became its retail partner (Tao, Liu and Ye, 2020). Later in the year company got rights of
selling its product with exclusive Mercedes-Benz F1 Racing Team related products. Puma
have established as leading motor sport company, it provides team wears to shining
Mercedes-Benz’s players. Customers got so influenced by seeing their favourite players
wearing the brand of which they can also purchase in marketplace. This sponsorship helped
company to boost up their profits as a result of excellent marketing decisions taken by
management of company and it is one of the leading company its product line.
Main Body
Info to subject sponsor
Puma is the third largest sportswear manufacturer in the world. Puma offers variety of
products for Football, Basketball, Running, Golf, Motor sports Training and Fitness and
Sport style. It is famous for providing quality products that are always liked by people.
PUMA also provides products related to famous sport (Ruda and Christ, 2019). The products
offered are available for all men, children and women. They provide different product line at
different countries according to the need and demand of the customers. They also offer
various accessories like bags, belts, caps, wallets, wristbands, bottles etc. PUMA will keep on
furnishing the MERCEDES AMG PETRONAS group drivers Lewis Hamilton and Nico
Rosberg with its lightweight race suits and execution footwear. The group's pit team will
likewise wear PUMA's most recent advancements in execution race wear at the Formula One
circuits. An authorized MERCEDES AMG PETRONAS assortment will keep on being
created and disseminated by PUMA and Brandon with footwear, attire and adornments
motivated by the group's legacy and driver characters.
Understanding of objectives
Mission of PUMA

To become the fastest sports brand in the entire world.
Vision of PUMA
To become sustainable and desirable sport life company in the world.
Values shared by PUMA
 Confident
 Brave
 Joyful
 Determined
Objectives of PUMA
 To improve the presence level of Puma within existing market through selling
products and services related to Basketball, Football, Golf, Running, Sport and Motor
Sports Training and Fitness style.
PUMA has three distribution channels that are Puma owned and operated retail stores,
wholesale and e-commerce stores. They have understood the needs and wants of customers
and are serving them in best possible ways. Being a big organisation it has presence in around
120 countries through its distribution channels. PUMA has good relations with retail partners.
They have also understood the digitalisation and made presence on online modes that is
advantageous for them and that helps them to attract more and customers. They are providing
employment to 13000 people worldwide. It is important to make right selection of
distribution channels to serve all the customers and fulfil their needs and wants. Online stores
make it easy for people to order according to their preference by sitting at home. The main
target customers are female and the products are best standing in the market. Basically, the
objective is to improve the presence level within the existing industry and in order to do so,
PUMA has effectively made partnership with Mercedes-Benz. With the help of this,
extension of team supplier is something that PUMA will effectively be done through
partnering with Mercedes-Benz.
The customers come to PUMA due to brand name and they fulfil their needs and wants.
They have loyal customers and that is one of the reason for success of the brand. PUMA uses
its own website and social media and also other paid online advertisements to promote the
products and service all over the world. It is important to good strategies and channels to
market its products. It is vital to make customers aware and remind them about the brand by
making advertisements that will attract the customers. The company has different websites to
its local and regional customers (Ruda and Christ, 2018).

It has always make research of market and made and implemented the best strategies to
gain the competitive advantage and gain good image in the market. The marketing strategy
used by puma is to restructure the organisation and earn more profit. The focus of improving
brand equity by giving value to its customers. They are exploring brand potential to increase
the desirability of the products offered by them. They want to become the most desirable
brand in sports life style. PUMA is sponsor of Mercedes Benz Team They have used their
strategies to make their brand's goodwill and has made sponsorship partner with companies
and attained success. PUMA has brand image and has its operations worldwide they are able
to serve their customers according to their needs and wants and have become successful.
Info on the sports rights-holder and assets
The announcement of sports sponsorship by Puma have exclusively enabled the
sponsorship with Mercedes Benz Team. They have started this as a merchandising partner
with them starting from 2019. Due to this now PUMA stands as well as superstores will; also
be present in 17 out of the total 21 Grand Prix in the given calendar. Globally the sports
industry is exploited and dominated by Nike and Adidas however Puma still holds to be third
in this place. There are a number of assets that are used by Puma while they are providing
sponsorship in the formula 1 racing. They are successfully looking out to a number of players
and offering them with apparels as well as shoes. There are also a number of accessories that
will be provided by them in the game (Madrigal and King, 2018). Along with this, the
company is successfully gaining visibility in the eyes of consumers through providing their
products to the participants and teams.
The demographics of Mercedes Benz Team fans can be considered as:
The total global TV cumulative audience stood at 1.922bn, the highest since 2012,
which represents an increase of 9% compared to 2018. This is the third consecutive year of
growth. In the top 20 markets (based in ranking of TV audience) it reached 1.781bn, with the
same increment year-on-year.
As they were last year, the top five markets by cumulative audience are Brazil,
Germany, Italy, UK and the Netherlands, all with audiences higher than 100m. Among the
top 20 markets, meanwhile, there have been exceptional increases; in Poland (+256%) and
the Middle East and North Africa (MENA) region (+228%,) mostly driven respectively by
new contract arrangements and Robert Kubica’s return to Mercedes Benz Team, and the new
agreement signed in 2019 with MBC Group. Greece (+75%), the Netherlands (+56%), Italy

(+29%) and Germany (+23%) were the countries with the highest increases, while the
audience continues to grow in the United States (+7%) and in China (+5%).
PUMA’s marketing objectives
PUMA’s marketing objectives are developed by keeping the data that they have
collected over their audience as establishment. In addition to that the organization uses active
monitoring skills in order to further modify their marketing skills and develop them in
accordance to right holders' requirements as well.
Puma is successfully equipping the teams of Mercedes AMG Petronas, Scuderia Ferrari
and Red bull racing as well. There are a number ODF asset that can be used by Puma in it
that is using their logos on the cars as well. The company have not provided their names on
the motor vehicles used in the racing. This was a great way through the help of which
organisation could have successfully provided their consumers with more visibility.
However, some sports sales on the venue have helped them to show their visibility and
enhance their image in the eyes of consumers as well. The accessories and apparels that have
been sponsored are enough to bring business to puma and enhance its consumer base. One of
the other reason due to which the organisation did not choose this option available to the was
the investment.
One of the major cost that is associated to the Mercedes-Benz F1 Racing Team is its
cars along with the racing track. If Puma chose to provide the cars to the teams they are
sponsoring it would have cost a lot to the organisation. Along with this it was also required
that they are using the assets that can be technologically advances to compete in the market.
All these factors have led the organisation to not sponsor the vehicles as well. It was a smart
decision on the part of puma as the organisation need to take care of a number of other factors
as well while they are sponsoring a business. The budget is to be kept in mind as the returns
from these sponsorships take a long time to reflect on the balance sheet.
Budget for rights and activation
The price for sponsoring Mercedes Benz Team requires huge amount. It has been mentioned
in the Forbes that in order to sponsor the deal of Mercedes Benz Team a company have to
pay a huge amount of $3.3million. This is having a great halo effect on the market of
Mercedes Benz Team which can be seen in present. When the times are tough in the market it
is a great way through which organisation cab bring a boom in the market (Kulczynski, Ilicic
and Baxter, 2017). During 2018 before Puma took the sponsorship of teams the total
sponsorship for Mercedes Benz Teams were accounted to be 44.7% of the total haul and the

turbo payments that have come from the sponsors which will also help in getting naming
rights for them. It also allowed companies to provide with decals on the parts of car that are
most visible.
Activation
Core Branding: PUMA is a well-known brand that has been adopted several branding
strategies in order to promote the company at wide level. For this, they sponsor several events
related to sports and more. Here PUMA has also sponsored Mercedes-Benz F1 Racing Team
during which they apply several strategies in order to enhance the presence of brand at
market place. They use logo of organisation in order to enhance visibility that is crucial to
earn potential profit margin. In addition, they also provided T- shirt with logo of company to
participants with an aim to grab the attention of audience (Todd and Simpson, 2019). During
event, main aim of PUMA was to enhance the visibility of their brand at market place to
attain predefined goals and objectives.
Public relationship: In order to generate public relations Puma is sponsoring team ans also
organising various events including the teams. Through the help of this they are coming in
news and building their reputation in the market. The long history of Puma is also helping it
successfully to make sure that the organisation is maintaining its relationship with
Sales promotion: They have used the track to set up their stores and small stalls as well. With
the help of this Puma is using sales promotion. They have also introduced a range of products
specially for formula 1 and its fans that is also a great opportunity for the organisation.
Through this they have successfully expanded their customer base as well.
Hospitality: In order to work on the hospitality in the sponsorship and arrangement with
formula 1 is adding various credentials to the Puma. Puma is also selling the products that
have been specially designed by them for Mercedes-Benz F1 Racing Team and are selling
them on the track side. They are providing facilities to their consumer directly as their
agreement with Mercedes-Benz F1 Racing Team is also helping them to connect directly
with their consumers. They are also providing their consumers with the best possible motor
sport merchandise for the best experience possible.
Advertising: Advertisement plays an important role in deciding profitability of a business
firm, In the starting of year 2019, Puma took sponsorship of Mercedes-Benz F1 Racing Team
organisation. It was a smart move from company’s management as it helped a lot in
promotion of its product. People got so influenced by watching their favourite players
wearing the brand wears. Logos and hoardings of brand was displayed in racing tracks and

hoardings of the brand was shown outside the stadium also (Kruse and et. al., 2020). The
marketing team of Puma conducts fun activities in the workplace and are purely dedicated to
extract best from their employees. The collaboration with Mercedes-Benz F1 Racing Team
helped in collecting the various aspects of marketing and enabled the business firm to
establish its marketing strategy at huge chunk of market customers. Therefore, it resulted in
paying of cost of initial investment and motivated company to not increase in prices of their
product for maintaining loyalty of customers towards its brand.
Employee Engagement: It was necessary for Puma to make sure that they are using their
employees so that maximum profits could be brought for the organisation. It is often seen that
there are a number of employees who require continuous motivation so the employees are
provided with it by the managers of Puma. It was continuing do that they can successfully use
the opportunity of sponsoring certain teams of Formula-1.
Third Party agencies
PUMA is a well-known brand that has been adopted several branding strategies in
order to promote the company at wide level. For this, they sponsor several events related to
sports and more (Kindt and Logan, 2018). Here PUMA has also sponsored Mercedes-Benz
F1 Racing Team during which they apply several strategies in order to enhance the presence
of brand at market place. They use logo of organisation in order to enhance visibility that is
crucial to earn potential profit margin. In addition, they also provided T- shirt with logo of
company to participants with an aim to grab the attention of audience. During event, main
aim of PUMA was to enhance the visibility of their brand at market place to attain predefined
goals and objectives.
Measurements
Benchmark:
It is the most important concept that helps to compare their performances and processes.
They set some benchmark that helps to compare performances of own with others. It just
simply comparison with other entities, so that individual can motivate to achieve that
performance levels (Kelly, Cornwell and Singh, 2019). There are many types of
benchmarking such as internal, competitive, functional, generic, etc. It is most important
activity that helps to accomplish their desired goals and targets. Every organisation set their
benchmarks so that they can achieve their strategic goals and targets.
Puma and Mercedes sponsor sports that helps to set their benchmarking. Puma has
different kind of benchmark that is they set their benchmarking for municipalities, schools

districts and advanced education. They used their benchmarking for different sectors so that
they can achieve their desired targets. They perform many activities that helps to accomplish
their benchmarking. It is very important for Puma because they perform functions only to
achieve their desired targets. Whereas Mercedes set their benchmarking that they innovate
their engines through making technologies like V6 and V8 that help to contribute in
environment factors. They thought they can improve their technologies to improve
environment through making environment friendly engines. They accomplish this benchmark
with the help of introducing third generation direct petrol injection. It is the engine in which
car consumes less fuel that helps to reducing cost of production and make high profits
margins. It also helps in less expansive car that can reduced customers fuel consumption and
their prices.
KPI: KPI is the acronym of Key Performance Indicator that refers to measure the
performance that can be done by their employees, company for achieving their gaols and
strategic objectives. It is the measurement tool that helps to identifying and analysing the
deviations that help to make strategies for meeting their goals and targets. Puma and
Mercedes sponsor sports, they are set their KPIs so that they can decide what they achieve
during sponsorship. Sponsorship is the function that helps to promote their goods and
services for providing to other business organisation (Weeks, Connor and Martin, 2017). For
this reason, Puma set their ROI targets that make their KPI to achieve their targeted market.
There are main five ROI targets that decide by Puma mentioned below:
 Database growth- It is the process in which organisation set their database so that they
can measure with their previous database and find the growth.
 Conversion rates- It is the rate in which organisation to gauge that how effectively
they use marketing program that shows visitors interest.
 Qualified lead volume- After conversion rates organisation need to determine their
targets so that they find leads are qualified.
 Pipeline growth- It is the tool that helps to measure inbound marketing that how they
can effectively have done this program.
 Return on marketing income- It gives the information in which organisation found out
the income that gain for their decided targets.
Whereas Mercedes set their KPIs through sales target, inventory management, gross
profits, etc. They measure their performances with their sales target that they achieve their
desired goals or not.
Recommendations:

Through taken this sponsorship and partnership criteria of the world's largest
company Puma and Mercedes. There projects could get better by being a mutual contract
against all the factors in terms ODF sales, promotion and branding the innovative and new
product. It could be done by together contribution towards marketing strategies. It could be
evaluating from the effective sponsorship campaigns and public relations by effective
communications with stakeholders, inverters and employees (Fowler and Thomas, 2019).
Partnership could get only be successful by mutual efforts regarding process of product
initiative. The main observation from this report has defined lack of agreement and
conversation between two companies which can be resolve by making effective flow of wok
and communication.
Puma is the leading brand in the whole world terms as the biggest sports brand
specialised in selling the best sport outfit in the whole country. It first established their brand
in German. The company was founded in 1948 and selling the best accessories for sports
athletes from around 72 years of services. The company has become the largest exporter and
importer of sports materials like clothing, footwear, and other sponsorship product. The
company has its biggest aim to achieve the brand heat and maintain the best quality sports
materials. It follows all the trends and innovation for making a good experience in athlete’s
lifestyle. athletes make their life easy and creditable by being a part of puma's customer. The
company is on the great track of its expansion through continuing their unique prestige in the
sports culture. Their business is followed and partnered by various high elect athletes such as
sprint legend Usain Bolt and star striker Antoine Griezmann, Mercedes Benz (Wilson et. al.,
2016).
In order to grow their brand with the antique culture and ethics they made their
sponsorship influence more high so that more of audience and large people could trust their
high potential and attribute. Puma has successful in their business by setting innovations heart
catching products design and texture. Customers are influenced by their cheap but high
quality product. It has been a big sponsor of Mercedes Benz by evaluation sports accessories
for their new launch of sports car. These apparels are mainly initialised for rider’s safety and
comfort. They have been the biggest merger of the biggest company of auto mobile. Puma
has scattered their business in the large area of around 120 countries which has served with a
great potential of customers trust and loyalty.
Puma has established high position in developing its brand name they has hit their sales
of around 3 million. They established their performance regarding environmental issues but
sitting goals towards their profit and loss. In 2011 they develop the most effective campaigns

for sustainable growth and fair existence towards environmental problems (Conrad and
Thompson, 2016). They have been winning the awards regarding efforts for launching reuse
and recycle campaign so that employees will indulge in welfare activities. Puma has
established with the sponsorship with Mercedes through which it has attain the contracts
which shows their transparency in their promotion. They have made clear in events to make
10% increment in sales of sport car athlete accessories though which they could more easily
showcase their innovative aspect of sports car. Their evaluation of rights and responsibilities
against the brand has abolished as it contaminated the brand exposure but not in increment of
sales. Puma campaign about safety rights of athletes has taken a lead and created impact on
their sale of apparels but as Mercedes fails to established the market strategies over the cars
and innovative features which has led to effect on Puma expectation of sales contract.
Summary
With the help of following report it can be successfully analysed that joining hands
with Mercedes-Benz F1 Racing Team was a great deal for Puma as company have enhanced
their brand image and visibility. Taking sponsorship of various sports events is an influential
method which can be adopted by organisations to increase their brand recognition. In this
way organisations can grow globally and increase their market share as well.

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Online
https://www.mercedes-benz.com/en/sports/formula-one/mercedes-amg-petronas-and-puma-
to-extend-partnership/