How NASCAR teams are dealing with unfilled sponsorships in 2017

FLRacingFan

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Pretty interesting piece.

http://www.espn.com/racing/nascar/s...teams-drivers-deal-unfilled-sponsorships-2017

When Clint Bowyer hits the track this weekend at Las Vegas Motor Speedway, he will have the company of team owner Gene Haas on his hood.

It will mark the second time in three weeks that Bowyer will have Haas Automation as his sponsor. Stewart-Haas Racing has spent the past 17 months working on selling sponsorship since naming Bowyer to take over for Tony Stewart starting this year, and it has announced only a few races with Mobil 1.

After Nature's Bakery terminated its 28-race deal for Bowyer's teammate Danica Patrick, she could have more than half the season open (the team won't confirm an exact number), leading to as many as 40 races still in need of a full sponsor just at SHR. Haas had already committed to sponsoring about half the season for Kurt Busch through his company.

"It's good for corporate America to know that we have a lot of races to sell on our car right now," Tony Stewart, a co-owner of the team, said the day before the Daytona 500. "You don't get that interest if they don't know it's available. ... Obviously, [Nature's Bakery] has been a curve ball for us.

"I'm very confident in our marketing staff. We've done a good job up until this point. I don't feel like this is a deal-breaker for us. We won't sacrifice performance over this. When you have four teams, it's a lot of inventory to sell, and you're going to have times like this."
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FLRacingFan said:
Pretty interesting piece.

http://www.espn.com/racing/nascar/s...teams-drivers-deal-unfilled-sponsorships-2017
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I agree that it is was an interesting read and it is shocking to see the number of top end teams with many races available. It sounds like SHR could have Haas Automation on 3 of its cars in the same race this year on more than one occasion which is awful.

I know this idea has been shot down but I still think the heavily discounted price and short term Monster paid to sponsor the entire series has to have had some impact on overall team/car sponsorship. You can sell just about anything to anyone if their perceived value is higher than the asking price and you can still sell a lot of things if the perceived value and actual cost are in line. However if the cost of something exceeds perceived value you are screwed as there will be few if any takers.

From the little bit I have read some of what Monster seems to desire, which essentially comes down to drivers shooting off their mouths and acting like WWE stars, is not in line with what most companies are seeking in a driver they are associated with. While there are no guarantees in life if I am considering spending 10-20 million a year to sponsor a team/driver I want to be assured that the driver isn't going to go off the rez and anger my customers to the point of negative publicity or boycotts.
 
This is an excellent piece, very well researched and comprehensive. Bob Pockrass deserves a lot of credit for it.

It's not good news. Sobering to see the extent of the problems among the elite teams.

Solutions to the problem are simple to identify and yet very hard to accomplish... raise the VALUE of sponsorship, and reduce the COST of it. These are interesting times in Nascarville USA.

PS- Skoal, what do WWE stars do? I'm familiar with quite a few Monster Energy athletes, but not WWE perfotmers.
 
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IMHO Haas has always had a bit of a sponsorship issue with one car. Especially, with Kurt in Haas automation having to sponsor the majority of his races at one point outside of state water heater for one race.

Kevin and Danica have always had fully funded rides with no issue and so did Tony. Its surprising to see that Code 1 Assoicates have jumped from the 14 to the 10.

I think Clint's only sponsor is Mobil 1 and I think Rush's Truck Stop is an associate. He's going to have to earn some sponsors this year.
 
To me this is not expected. With the current drop in TV ratings and less people in the stands why would a company pay out big bucks to a sport which is obviously on the decline. I can buy tickets for the April Bristol race yet.
 
LewTheShoe said:
This is an excellent piece, very well researched and comprehensive. Bob Pockrass deserves a lot of credit for it.

It's not good news. Sobering to see the extent of the problems among the elite teams.

Solutions to the problem are simple to identify and yet very hard to accomplish... raise the VALUE of sponsorship, and reduce the COST of it. These are interesting times in Nascarville USA.

PS- Skoal, what do WWE stars do? I'm familiar with quite a few Monster Energy athletes, but not WWE perfotmers.
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In the end it will all be fine as everyone in Nascar will have to make do with less and it is likely drivers won't make as much as well as other team employees. The series may even be better with less money involved for all I know. It sounds like a lot of the top teams have a 1 dollar item that they feel is worth 2 dollars but just have not accepted the reality yet. At some point they will realize that expenses need to be cut and that half a loaf is better than no loaf at all.

What is really remarkable to me is that so many people seemed to think that Nascar and its teams were going to be able to carry on business as usual despite the massive erosion in fan support over the years. If anything I am surprised it has taken this long for the chickens to come home to roost but a dam leaks before it bursts. At this point everyone who even remotely likes Nascar should be sending thank you notes and flowers to FOX and NBC for their drunken spending on broadcast rights as if they had not done so one can only imagine where things would be.

As far as the WWE stuff goes I will direct you to Youtube but from what I have read Monster wants things like aggression, agitation, and confrontation with Nascar drivers and perhaps those are things the fans want too but I can assure you it is not something most sponsors want.
 
be9ak7ts16 said:
To me this is not expected. With the current drop in TV ratings and less people in the stands why would a company pay out big bucks to a sport which is obviously on the decline. I can buy tickets for the April Bristol race yet.
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You could walk up to the wicket and gets tickets for the spring Bristol race 5 minutes before the drop of the green.

emptybmsseats.jpg
 
NASCAR and its race teams have a golden opportunity at their fingertips. Begin advertising for conglomerates such as Twitch & YouTube and start streaming live races on those outlets in order to attract a larger (& younger) audience. Social media is where it is at, not your ordinary consumable good.
 
be9ak7ts16 said:
To me this is not expected. With the current drop in TV ratings and less people in the stands why would a company pay out big bucks to a sport which is obviously on the decline. I can buy tickets for the April Bristol race yet.
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Ratings are down and attendance is down, but there are still people watching the race on TV and going to the races. That creates a market for advertising. Even the worse sitcoms on TV have commercials.
 
RacerrecaR said:
NASCAR and its race teams have a golden opportunity at their fingertips. Begin advertising for conglomerates such as Twitch & YouTube and start streaming live races on those outlets in order to attract a larger (& younger) audience. Social media is where it is at, not your ordinary consumable good.
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I am glad you posted that as it is something this old mind would not have thought of but what you say makes sense.
 
RacerrecaR said:
NASCAR and its race teams have a golden opportunity at their fingertips. Begin advertising for conglomerates such as Twitch & YouTube and start streaming live races on those outlets in order to attract a larger (& younger) audience. Social media is where it is at, not your ordinary consumable good.
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The issue with that is NBC and FOX aren't going to give up their exclusive TV Everywhere rights any time soon.
 
dave corthell said:
Ratings are down and attendance is down, but there are still people watching the race on TV and going to the races. That creates a market for advertising. Even the worse sitcoms on TV have commercials.
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One of the members here has mentioned that he has never seen a race where a commercial spot has not been sold and that is true. However you don't know if the commercial has been paid for or was a freebie given away in a package or sold at a highly discounted rate. Nascar teams will always be able to cover their cars with sponsors but it may be for a lot, lot less than they used to receive.
 
Kiante said:
IMHO Haas has always had a bit of a sponsorship issue with one car. Especially, with Kurt in Haas automation having to sponsor the majority of his races at one point outside of state water heater for one race.

Kevin and Danica have always had fully funded rides with no issue and so did Tony. Its surprising to see that Code 1 Assoicates have jumped from the 14 to the 10.

I think Clint's only sponsor is Mobil 1 and I think Rush's Truck Stop is an associate. He's going to have to earn some sponsors this year.
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I think part of it with Haas is he's not willing to put a sponsor on the hood for a large discount. He'd rather just put his company on the car than get a deal he doesn't feel is fair.
 
FLRacingFan said:
The issue with that is NBC and FOX aren't going to give up their exclusive TV Everywhere rights any time soon.
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YouTube and Twitch aren't TV. However, I'm unsure of the actual contract details and do not know if non-tv live streaming services are included.
 
"The big teams such as SHR have support from manufacturers, and that support doesn't just come from cash. It can come from engineering support, use of facilities and research and development resources that can compensate if the team can't afford something on its own"

Why they matter so much
 
Fordracing7 said:
"The big teams such as SHR have support from manufacturers, and that support doesn't just come from cash. It can come from engineering support, use of facilities and research and development resources that can compensate if the team can't afford something on its own"

Why they matter so much
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True, but if big teams didn't receive that support the resources could be spread to the smaller teams as well. Just depends on if you prefer the MLB or the NFL type of sports economy.
 
Fordracing7 said:
"The big teams such as SHR have support from manufacturers, and that support doesn't just come from cash. It can come from engineering support, use of facilities and research and development resources that can compensate if the team can't afford something on its own"

Why they matter so much
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Obviously any support you can receive from anyone be it monetary or otherwise is what you want but you still need sponsorship unless Gino doesn't care and wants to fund the team out of his own pocket. I just hope he is paying his personal and corporate taxes so none of this is on my nickel.
 
RacerrecaR said:
True, but if big teams didn't receive that support the resources could be spread to the smaller teams as well. Just depends on if you prefer the MLB or the NFL type of sports economy.
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It will be interesting to see if less dollars to teams does equate to substantially less dollars for the drivers and the impact a lower salary would have on drivers as they get older. It may have no impact or it may cause some of the older guys that have made their fortune to retire a few years earlier if they are not making as much.
 
DanicaFreak said:
what do you think of the article in this post?
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I mean, I didn't learn anything. It's a good 40,000ft view on sponsorship problems. The overriding issue is the same drum I've beaten on this forum since I got here - from a strict advertising proposition, most of the big teams can't deliver ROI. It's just not worth the money. Dollars in rarely equal dollars back. Prices are dropping, and that's a good thing for the long term health of the sport, but probably not a good thing for current salaries and overhead.

Now that's just for advertising/messaging. From a B to B standpoint, there still might be decent ROI. If you're a company like Cessna or Caterpillar, and you're using NASCAR as a hospitality vehicle for all your big money clients (which is why they're there), and they're renewing contracts (not to mention meeting other companies in the garage who eventually become clients, etc), then it's worth it. I know Gene has done lots of business at the track by entertaining clients...certainly more than enough to warrant spending on the 41.

But most of the big companies who spend a ton of money selling consumer goods or services are there for one main reason - they love it. They'll never admit it, but it's the fact jack. Lowes, Mars, GEICO, FedEx, Miller Lite, Bud, etc etc etc. They're all there because they have an internal champion with a lot of power. WITHOUT QUESTION...as in take this to the bank....the single biggest reason why big companies pull out of NASCAR is a change in leadership. Someone new comes in and says "why are we spending all this money in NASCAR" and no one there can prove the value. "We spend that money because Doug loved to go to the track every weekend disguised as work, drink beer, have his butt kissed and shack up with interns" doesn't really resonate with a new CEO or board of directors (unless they like beer and interns...but even then they'd still have to like racing. They can drink beer and bang interns anywhere the corporate jet takes them.)
 
Allenbaba said:
I mean, I didn't learn anything. It's a good 40,000ft view on sponsorship problems. The overriding issue is the same drum I've beaten on this forum since I got here - from a strict advertising proposition, most of the big teams can't deliver ROI. It's just not worth the money. Dollars in rarely equal dollars back. Prices are dropping, and that's a good thing for the long term health of the sport, but probably not a good thing for current salaries and overhead.

Now that's just for advertising/messaging. From a B to B standpoint, there still might be decent ROI. If you're a company like Cessna or Caterpillar, and you're using NASCAR as a hospitality vehicle for all your big money clients (which is why they're there), and they're renewing contracts (not to mention meeting other companies in the garage who eventually become clients, etc), then it's worth it. I know Gene has done lots of business at the track by entertaining clients...certainly more than enough to warrant spending on the 41.

But most of the big companies who spend a ton of money selling consumer goods or services are there for one main reason - they love it. They'll never admit it, but it's the fact jack. Lowes, Mars, GEICO, FedEx, Miller Lite, Bud, etc etc etc. They're all there because they have an internal champion with a lot of power. WITHOUT QUESTION...as in take this to the bank....the single biggest reason why big companies pull out of NASCAR is a change in leadership. Someone new comes in and says "why are we spending all this money in NASCAR" and no one there can prove the value. "We spend that money because Doug loved to go to the track every weekend disguised as work, drink beer, have his butt kissed and shack up with interns" doesn't really resonate with a new CEO or board of directors (unless they like beer and interns...but even then they'd still have to like racing. They can drink beer and bang interns anywhere the corporate jet takes them.)
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Thanks Allen. Thats what happened with Go daddy and Danica-the exec left that was into racing.
 
curious about the increase in number of employees for the big teams over the past 20 years.

can't remember the specifics, but during this past weekend's race wasn't there a mention of some team employing an outrageous number of engineers?

budgets are going to have to adapt to current revenues.
JMO
 
klemmabyna said:
curious about the increase in number of employees for the big teams over the past 20 years.

can't remember the specifics, but during this past weekend's race wasn't there a mention of some team employing an outrageous number of engineers?

budgets are going to have to adapt to current revenues.
JMO
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For sure as NASCAR will always be around but it simply can't operate on the model that it did when it was the juggernaut coming down the pike. IDK how many engineers HMS employs but a while back I heard the number and just shook my head.

It is funny as the more the racing has improved and NASCAR has done things we didn't know we wanted the less interest has been.
 
DanicaFreak said:
Thanks Allen. Thats what happened with Go daddy and Danica-the exec left that was into racing.
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Aaron's, Office Depot, Home Depot, UPS, Dollar General, many of the Kellogg's brands (most recently Cheez-Its), the list goes on...

From what I've heard, the Target sponsorship is in jeopardy of shrinking/going away next year as well.
 
Read somewhere Target already dumped Ganassi's open wheel thing 'n they wouldn't be renewing the NASCAR effort.

The article could have been in error I suppose.
 
R Clarence said:
Read somewhere Target already dumped Ganassi's open wheel thing 'n they wouldn't be renewing the NASCAR effort.

The article could have been in error I suppose.
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I can't really blame Target for pulling out. They've been with Ganassi at the Cup level since 2002 and have only seen their car in Victory Lane twice (JPM at Watkins Glen in 2010 and Larson at Michigan last year).
 
Did they win anything in the open wheel events?

Asking because I don't follow it 'n have no idea.
 
R Clarence said:
Read somewhere Target already dumped Ganassi's open wheel thing 'n they wouldn't be renewing the NASCAR effort.

The article could have been in error I suppose.
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After the huge debacle Target had in Canada I doubt they will be sponsoring a little league team in Minneapolis.
 
FLRacingFan said:
TV Everywhere is streaming. FOX Sports Go, NBC Sports Live Extra.
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Gotcha. But what if a team advertised Twitch/YouTube on their car and streamed the race live on one of those outlets while having their other sponsors on the screen during the stream? Is something like that not allowed with the current TV contract?

Just imagine a team doing that and having in-car audio, crew chief/spotter communication, live chat between viewers, etc. The "Let's Play" and "live streaming" community with the younger generation is HUGE right now...billions of views per day. It will only be getting bigger. THIS is how to attract the casual and young audience to the sport.
 
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