Sep 25, 2013, 4:00 PM EDT
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field Helio Castroneves and Ryan Briscoe’s cars since Philip Morris tobacco money exited at the end of 2010 (livery was withdrawn at the end of 2009).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.
Mar 10, 2014, 4:03 PM EDT
The Penske troops do the wing-and-beer thing in their team shop.
Mar 10, 2014, 3:38 PM EDT
The new simulator, expected to be used heavily by IndyCar teams and other automotive groups, is set to be fully operational by the end of April.
Mar 10, 2014, 2:31 PM EDT
The outspoken Canadian tells a pair of Italian publications that Vettel’s “not going to win this year for sure.”
Mar 10, 2014, 2:00 PM EDT
Five prior Melbourne winners in field as F1 begins new era this weekend.
Mar 10, 2014, 1:25 PM EDT
Teams will use Pirelli’s medium and soft compounds in this weekend’s F1 season opener Down Under.
Mar 10, 2014, 1:00 PM EDT
Big year for Pocono in terms of contribution to Pennsylvania economy.
Mar 10, 2014, 12:00 PM EDT
2014 marks 10 years since Michael Schumacher’s fourth and last win in Melbourne.
Mar 10, 2014, 11:21 AM EDT
David Reutimann third driver in revolving door of No. 35 FRM Ford.
Mar 10, 2014, 11:00 AM EDT
Race winners, top-10 finishers off to great start; three of four SHR cars among those with work to do to catch up.
Mar 10, 2014, 10:06 AM EDT
No LMP1s and mostly streamed live coverage will make for a different Sebring viewing experience this weekend.
Mar 10, 2014, 9:00 AM EDT
Youngest American in the field could be primed to make the “year three leap.”
Mar 10, 2014, 8:00 AM EDT
Tony Kanaan takes over No. 10 Target ride, and seeks a return to title contention.
Mar 9, 2014, 8:56 PM EDT
A late strategy gamble pays off for Edwards with his best finish of the young Sprint Cup season.
Mar 9, 2014, 8:13 PM EDT
Kyle was strong during the Kobalt 400 but faded late, while Kurt couldn’t escape mid-pack.
Mar 9, 2014, 7:16 PM EDT
The Richard Childress Racing driver finishes third in a strong effort at Las Vegas.
Mar 9, 2014, 6:48 PM EDT
Joey Logano was the rubber band man in Sunday’s Kobalt 400 at Las Vegas Motor Speedway.
Mar 9, 2014, 6:33 PM EDT
With about 20 laps remaining, crew chief Steve Letarte warned race leader Dale Earnhardt Jr. that he would be about a half-lap shy of enough fuel to finish Sunday’s Kobalt 400 at Las Vegas Motor Speedway.
Mar 9, 2014, 5:58 PM EDT
Bad Brad sweeps the NASCAR weekend in Sin City.
Mar 9, 2014, 5:29 PM EDT
Kevin Harvick went from halfway to no way in Sunday’s Kobalt 400 at Las Vegas Motor Speedway. After leading the race at the 134-lap halfway point of the 267-lap event, Harvick’s bid for back-to-back wins came to an abrupt end when his No. 4 Stewart Haas Racing Chevrolet suffered a broken left front wheel hub…
Mar 9, 2014, 5:15 PM EDT
Richard Petty is going back home to Level Cross, N.C. – the Richard Petty Museum, that is.
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