Sep 25, 2013, 4:00 PM EST
The last several weeks have seen sponsor stories take over from on-track ones as the dominant players in the North American racing news.
NAPA, of course, has made the biggest announcement with its decision to leave Michael Waltrip Racing at the end of the year, in the wake of the controversy at the NASCAR Sprint Cup Series regular season finale at Richmond. 5-Hour Energy, additionally, seems displeased with the action the organization has taken in a statement it has released.
Other sponsors are on the move, which is normal in racing, but noteworthy in their timing after Richmond. Valvoline leaves Roush Fenway Racing for Hendrick Motorsports; Jimmy John’s goes with driver Kevin Harvick from Richard Childress Racing to Stewart-Haas Racing.
Castrol made the jaw-dropping decision earlier this year to leave John Force Racing at the end of 2014 in NHRA after 29 years.
And then there is the report this morning that GoDaddy is re-evaluating its role as a primary sponsor in IndyCar with Michael Andretti’s team, citing low television ratings as the impetus for a potential move out of full-time primary sponsorship there.
It all adds up to a fascinating question: Which part of racing do sponsors prefer most? Is it on-track performance, ethics, or ratings?
To borrow a term from NASCAR President Mike Helton, the “ripple effect” of the last few weeks has changed the corporate game in a way we haven’t seen for quite a while. Sponsors often come-and-go from racing but it’s become increasingly apparent the Richmond saga has made a bigger impact on all forms of motorsport than we might have realized in the immediate aftermath.
If it’s on-track performance you crave, ideally, IndyCar would be the best bang for the buck. It costs substantially less – think in the $4 to 8 million range – for a season-long sponsorship (by comparison to $15 to $20 million in NASCAR). A sponsor can advertise itself at the Indianapolis 500, the largest single-day sporting event in North America, and have the chance to win a variety of different circuits.
That said, the marketing and promotional aspect of the variety apparently does not justify the ROI as it stands now. Roger Penske, for instance, has had to put together a consortium of sponsors to field Helio Castroneves and Ryan Briscoe’s cars since Philip Morris tobacco money exited at the end of 2010 (livery was withdrawn at the end of 2009). Elsewhere around the grid, teams have become increasingly reliant on drivers bringing sponsorship to secure a seat. There’s still plenty of talent on the grid, but the days of fully-funded rides without bringing a dollar are drawing to an end.
NASCAR, meanwhile, can offer better TV ratings on the whole, with the performance aspect secondary. It’s why Danica Patrick, for instance – long seen by this writer and others as a good-but-not-great driving talent who has made most of her career via marketing – can afford to run 25th to 30th place every week, but maintain the GoDaddy support for the awareness and buzz she creates off-track.
Now, though, NASCAR faces an ethics crisis the likes of which it has rarely seen. If NAPA’s departure is the tip of the iceberg in terms of corporate America withdrawing its dollars, it could create another “ripple effect” – to borrow Helton’s words again – where more sponsors depart and hundreds of families see jobs go away. That might be an extreme way of looking at it, but it is certainly possible if sponsors don’t see the value in the tens of millions of dollars invested and the PR too damaging to their brands.
A good take from the Sporting News’ Bob Pockrass, linked here, suggests NASCAR needs to implement a “grand plan” to soothe sponsors and their concerns. Pockrass notes there are elements where NASCAR is already involved in direct communication with sponsors – notably via Chief Marketing Officer Steve Phelps – but that needs to expand in the wake of the Richmond controversy.
As a fan, you want to see sponsors – regardless of series – do the job of activating and creating a connection that spurs you to root for said sponsor and buy more of their product. As a sponsor, you ideally want to be successful in all three aspects of performance, awareness and moral standards.
Depending on the fallout the rest of 2013 as it relates to sponsor movement, we’ll see which of the three takes precedence in the motorsports landscape.
Feb 1, 2015, 5:00 AM EST
F1 pre-season gets underway in Jerez with the first public test.
Feb 1, 2015, 4:35 AM EST
Something out of the ordinary from Red Bull as pre-season testing begins in Jerez, Spain.
Jan 31, 2015, 11:09 PM EST
Given the way the 2014 season turned out for him, Jimmie Johnson would have preferred to see the old Chase for the Sprint Cup format rather than the new elimination format.
Jan 31, 2015, 5:13 PM EST
With Al-Anabi Racing now defunct, team owner Alan Johnson has picked up the remnants and intends on racing one Top Fuel dragster, with 2013 champ Shawn Langdon behind the wheel, in at least the first two races of the 2015 season.
Jan 31, 2015, 4:01 PM EST
Jeff Gordon wanted to see his successor continue on the legacy of the No. 24 car. Chase Elliott is happy to continue that tradition.
Jan 31, 2015, 4:00 PM EST
Mexican driver is excited for the return of his home grand prix in November, even if he won’t be racing.
Jan 31, 2015, 3:30 PM EST
News and notes after Indy Lights wraps up its week of testing in Homestead.
Jan 31, 2015, 3:21 PM EST
Richard Childress Racing and Matt McCall have reached settlement on a lawsuit that sought to keep McCall from becoming Jamie McMurray’s crew chief for the 2015 season.
Jan 31, 2015, 3:00 PM EST
Mexican driver feels that Force India’s hunger can take the team up the grid this year.
Jan 31, 2015, 2:30 PM EST
Kenseth and DeWalt are back together, and the six-race sponsorship dates are revealed.
Jan 31, 2015, 2:00 PM EST
Ron Dennis makes clear that Alonso is locked into his new contract with the British team.
Jan 31, 2015, 1:30 PM EST
Herald Scotland checks in with Dario Franchitti on his new life outside the cockpit.
Jan 31, 2015, 1:00 PM EST
Prepare for round two with Hamilton and Rosberg as they set their goals for the season ahead.
Jan 31, 2015, 12:30 PM EST
With a combined age of 37, Max Verstappen and Carlos Sainz Jr. forge the youngest line-up in F1 history in 2015.
Jan 31, 2015, 12:00 PM EST
Patriots or Seahawks? NASCAR’s top drivers make their picks for Sunday’s Big Game.
Jan 31, 2015, 11:30 AM EST
Watch a time lapse video of how the Ferrari SF15-T gets stickered up in advance of the 2015 season.
Jan 31, 2015, 11:21 AM EST
Max Verstappen and Carlos Sainz Jr. lift the covers from the team’s 2015 car, marking its tenth year in F1.
Jan 31, 2015, 10:30 AM EST
Highlights from the special event featuring NASCAR drivers and former NFL stars.
Jan 31, 2015, 10:00 AM EST
He may have risen rapidly up to a seat at Red Bull, but Daniil Kvyat is not feeling under pressure.
Jan 31, 2015, 9:00 AM EST
All of the information you need for the first official F1 test of the year.
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