NASCAR Is Confident About Finding A Replacement Title Sponsor


NASCAR is now tasked with the chore of finding a title sponsor replacement by the end of 2016 to replace Sprint.  It sounds like a daunting chore, but not to worry race fans, notwithstanding the fact that the sponsor must be able to lay out $70-75 million annually, there are corporations out there that may be willing to spend that kind of money.

Look at the quick service restaurant industry (Subway, Burger King, etc.), packaged goods (Coca-Cola, Pepsi, Unilever, etc.), consumer products (Panasonic, LG, etc.) or companies looking to boost their product line (as was Nextel) will be prime candidates for NASCAR’s next deal. There also could be interest from new or quickly developing industries, such as the energy sector.

“It’s got to be a big, consumer brand,” said Just Marketing International CEO Zak Brown, whose company has worked with Verizon and other firms on their motorsports sponsorships. “It’s one or two approaches. It’s someone like Nextel, who made a really bold step because they were number three or four or five in the category and they wanted to take a big leap.

“Or you go to someone who already is the leader in a category. … I’d be very surprised if they didn’t find one.”

These types of sponsorship deals typically take three to six months to complete, and NASCAR likely needs to have a good idea of who will sponsor the series by next July, Brown said.

That would be a little late to Humpy Wheeler, the former president of Charlotte Motor Speedway and parent company Speedway Motorsports Inc.

He’d like to see a sponsor in place by this time next year, and he’s optimistic that NASCAR will land one.

“A new sponsor, particularly if it is in a category that we’ve never had before like a software, Microsoft, Apple-type thing, would sure bring new vigor to the whole thing,” Wheeler said.

It obviously needs to be a company that has money, but that money can be divided up in many ways. The series points fund was about $22 million. Then there is money to NASCAR for branding as well as a significant media buy as far as promoting the sport and advertising on NASCAR telecasts.

“People say it’s terribly expensive,” Wheeler said. “We know it’s a lot of money. But if you compare it to a company that is engaged in advertising with the NFL for a whole season including the Super Bowl, somebody who has taken a big new sitcom on, it’s really not out of that realm of possibility.

“It’s not something 200 companies can afford. It’s probably down to 50. I think we will find somebody that will come in here and sponsor it and we’ll probably be better off as a result.”

Mike Boykin, CEO of Bespoke Sports & Entertainment, said it would be difficult to put a number on the possible companies that could sponsor. He said he also views energy or petroleum companies as possibilities in addition to the traditional firms.

“What if it’s somebody from offshore?” Boykin said. “It could be an energy company, a petroleum company, a CPG [consumer packaged goods], it could be technology.

“In the old days, you could narrow it down to U.S. companies. But right now, while I think the likelihood it will be a North American company, I wouldn’t rule out the other.”

Wheeler said if NASCAR’s aerodynamic changes work and the racing is better in 2015, the sport could ride the upswing in landing a good deal with a sponsor.

“There is only a few big entitlement opportunities,” Will Pleasants said. He is senior vice president for consulting for Wassmeran Group, which coordinated Nationwide’s marketing efforts. “And this is one of them. … There is still value in the entitlement in this setting. We saw it with Nationwide. You can make an impact in a relatively short amount of time.”

Marketers do have reason to be optimistic — if one of their clients secures the sponsorship, it could be big for their business. But they also deal in a sports marketing world that continues to see significant advertising agreements.

Pleasants said a series sponsorship gives a company year-round publicity with consistent ratings while also not being dependent on the performance of a specific driver. He said it will come down to the right value for what the company is looking to gain and activate the sponsorship.

“People will definitely take a look at it because it doesn’t come along very often, at least in this sport and the pinnacle of the sport,” Pleasants said. “Absolutely it’s something that will be considered because of the unique ownership position that platform and sponsorship provides.”

NASCAR’s most recent deals for its top two series were for seven and 10 years, so it likely will want this one will to have a similar term. But with things changing so quickly in so many industries, a potential sponsor’s executive might prefer a shorter term considering the price.

“That could be a challenge to get somebody to invest 10 years,” Boykin said. “Do I think there is a brand out there that will see this as a huge opportunity?

“Yeah. … There might be brands that are willing to put 70-plus (million dollars) but three or four years. The longer the length, the more traditional the partner, somebody who has been around.”

What does NASCAR have to offer?

According to NASCAR’s latest fan demographic survey done by Nielsen Scarborough earlier this year, stockcar racing’s fan base is 63 percent male.

It says that 23 percent of its fan base is multicultural, including 10 percent African-American and 9 percent Hispanic. Half of NASCAR fans live in a household with an annual income of $50,000 or more, and one in four NASCAR fans are 18-34.

According to a survey NASCAR commissioned in 2013, about 40 percent of fans are loyal to NASCAR sponsors and buy their products. And 33 percent participate in sponsor promotions that use NASCAR to push the campaign.

But the facts also show NASCAR attendance is dipping. For 26 Cup race weekends included in the most recent reports by the sport’s publicly traded racetracks, admissions revenue (including non-NASCAR events) was down 3.3 percent.

As far as television, NASCAR reports that it averaged 5.3 million viewers per event, down 9 percent overall (7 percent when taking out the rain-delayed Daytona 500).

Fox saw a 10 percent ratings dip for its 13 races. ESPN was flat for its 17 races for the fourth consecutive year at a 2.9. The 10-race Chase was flat for the third consecutive year at 2.7 with a 3 percent increase in viewership.

“Obviously there is probably a little bit of anxiety that comes along with replacing a sponsor like that because it’s not an easy world to be selling in right now,” Brown said. “That’s not a NASCAR issue. That’s a state of the world.

“These things always come and go. … (Sprint has) had a tremendous amount of business change from ownership to mergers to not-mergers to big financial problems, so I don’t see it as a poor reflection on NASCAR. It’s really just kind of the state of play with Sprint and where their world is.”

NASCAR, which declined to make an executive available to speak for this article, points to viewership being up 11 percent over the final three races as a sign that the new Chase format is adding value. NASCAR also says it has seen significant increase in social engagement.

“I’d say it’s very high that they’ll find a partner,” Boykin said. “I just don’t know the terms. … The overall engagement, like those (statistics say), people are just consuming it differently.”

One key could be exclusivity. When Nextel came in, it allowed for existing telecom contracts and sponsorships to remain (not just with teams, but with tracks also) and to be renewed, but no new relationships could start.

Amid the telecom mergers, that squeezed out sponsors at Richard Childress Racing (Cingular to AT&T) and Team Penske (Alltel to Verizon).

In its latest series sponsorship deal, NASCAR sold some exclusivity to Xfinity, although the only current team sponsor was Charter, which had sponsored races in what was then the Nationwide Series with two different teams. It won’t be allowed to sponsor a team in that series, but can sponsor a team in other NASCAR series.(sporting

It will be interesting to see which corporation steps up to the plate, takes the bull by the horns, and ponies up the big money for title sponsorship for NASCAR’s highest touring series.


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