Open-Wheel Racing Case Study

Satisfactory Essays
Although Tony George, President of the Indianapolis Motor Speedway, created the Indy Racing League (IRL) to be a new open-wheel league that would compete with Championship Auto Racing Teams (CART), the new league was disruptive to open-wheel racing in the U.S. as team owners were forced to decide whether they would remain with CART or move to the new IRL (Ferrell and Hartline, 2014, p. 440). Because of his concerns that CART was losing sight of the interests of American open-wheel racing by putting too much emphasis on racing at road courses rather than oval tracks, turning too much focus on promoting top foreign drivers as CART stars, and holding events in foreign countries, George developed the IRL in hopes to bring support back to American open-wheel racing (p. 442). However, this was not the case at all. From a segmentation perspective, the split was unsuccessful for several reasons. First, by forming the IRL and allowing only IRL members to race in the Indianapolis 500, George forced CART teams to plan their own event on the same day as the Indy 500 (Ferrell and Hartline, 2014, p. 442). In fact, CART drew in over 100,000 spectators when it held the U.S. 500 at the Michigan International Speedway on Memorial Day weekend of 1996 (p. 442). Second, the dispute between CART and the IRL…show more content…
Although it was not the intention of George, the split in open-wheel racing was a setback to open-wheel racing in general (Ferrell and Hartline, 2014, p. 444). It resulted in a decrease of competition quality, fan support, and sponsor dollars (p. 444). The goal of segmentation is to create a variety of products/services that better suit the needs of different customer groups (p. 115). Although the behavior of consumers/users can be irrational and unpredictable at times, I am not sure that George did enough research regarding successful market segmentation (p.
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