Backseat Blonde - Dollars and Sense

June 7, 2004

Dollars and Sense: Sponsors Need to Learn Patience
by Allison Wagda

The collective gasp from the halls of DEI was audible
all the way out here in California. Dale Earnhardt Jr., in
his typical frank fashion during an interview on Friday,
fueled rumors that Michael Waltrip’s tenure driving
the #15 Napa Chevy may be in jeopardy.

It wasn’t an official statement from DEI, nor did it
include the typical doublespeak of a well crafted PR
message. Dale Jr. told the unvarnished truth. Racing is about business, regardless
of personal relationships. The honesty was refreshing, but the message was
disturbing: Waltrip is dispensable.

Apparently, all this brouhaha is related to the fact that Napa Auto Parts’ contract with
DEI expires at the end of the season. Either the price of renewing the sponsorship
is at issue, or Napa executives are demanding more victories for their money.

Based upon Junior’s comments, it would appear to be the latter. In the interview,
Junior alluded to Waltrip’s performance so far this season as one reason his future
is uncertain. Waltrip has certainly had a tough start. Until last week’s race at
Charlotte where he crossed the finish line in second place, he was mired in 30th
place in points.

It’s not a unique story. During yesterday’s telecast of the Dover race, commentators
mentioned that victor Mark Martin’s team had been under pressure to produce
better results from sponsor Pfizer, makers of Viagra. Pennzoil bailed out on Cup
racing after DEI tried to appease them by firing the popular Steve Park for Jeff
Green last season (Richard Childress Racing fired Park next, after AOL didn’t get
the immediate pay off it sought.) Citgo left fan favorite Jeff Burton after an average
year in 2003. The wreckage from sponsor demands is piling up.

But have expectations exceeded reason? Silly season, the part of the racing year
when teams evaluate their long-term plans, has always been a part of racing. As
has the need to keep sponsors happy by producing results. But sponsors today
seem to all expect the highest levels of success from their drivers. Rookies are
expected to be instant stars or face the unemployment lines. Veterans like Mark
Martin, long proven to be more than capable drivers, can’t rest on past
achievements or a huge fan base. At the end of the day, sponsors want wins.

With 38 races per year, and a typical field of 43 drivers, not every driver can run up
front every week. And even fewer can take the checkers. That leaves all but a few
elite teams in a constant struggle to maintain the funding to run a successful team.

NASCAR and the teams themselves shoulder some of the blame. The price of a
primary sponsorship has spiraled out of control as the costs associated with
fielding a full-time car have increased. DEI employs a campus full of individuals to
support its two Nextel Cup cars. NASCAR has continues to disperse races around
the country and change car requirements…both costing team’s extra money.

Sponsors need to understand that winning isn’t everything. Yes, the sponsor may
gain added exposure, but it should be considered gravy. The investment needs to
be tied to the personalities involved, and the sponsorship should be a platform for
other marketing initiatives.

The value needs to be measured by more than the number of times a logo appears
during a broadcast. NASCAR fans support the sponsors of their favorite drivers buy
buying their products. For example, NEXTEL didn’t commit their marketing budget
for years to come to purchase air time. They wanted direct, unfettered access to
NASCAR’s 70+ million loyal fans.

Viagra should be very pleased to have one of NASCAR’s top veterans promoting an
image of vitality and stamina. Napa has one of the most engaging and entertaining
drivers under its mast, and its commercials featuring Waltrip rank among fan
favorites. Sponsors can’t discount the fact that Tony Stewart fans drive 20 miles out
of their way to shop at Home Depot when Lowes is right down the street, and
Junior fans proudly toast their bottles of Bud instead of a more tasty brew.

Part of the problem is the people who hold the purse strings. Quite often, the
marketing people at sponsor companies aren’t race fans. They are simply looking
for hard metrics that support their investment. Unfortunately, accurately tracking
fan purchases or brand impact is often impossible. So instead of understanding the
bigger picture, they give their executives useless numbers that often don’t justify
the expense.

With that reality, can NASCAR rely on the current sponsorship model to fill the field?
Perhaps we are entering an era where only a few superstars have full-time primary
sponsors. But advertising is about consistency, so I doubt many potential sponsors
will be lured by a shared spotlight.

So, what’s the answer? If I knew, I’d probably be very wealthy. But I think it has to
start with education. Fans need to step up and let the sponsors know what it
means to sponsor their favorite driver. When you walk into a Napa store, tell the
manager that Michael Waltrip sent you. When you call to pay your Cingular bill, ask
the customer service rep if they root for Robby Gordon.

While these things might seem useless when done by one person, if it happens
enough word will reach the executive offices. We need to let the purse holders
know that our loyalty is tied to our driver. Lose the driver, lose my business.

And NASCAR needs to share a bit of the wealth, and stop tying up entire industries
with exclusive contracts. Jeff Burton was reportedly in talks with AT&T, but couldn’t
close the deal thanks to the Nextel Cup sponsorship.

DEI will make a significant mistake if they dump Waltrip. Who would drive the #15?
Greg Biffle is rumored to be looking at DEI. Will Napa really benefit more from Biffle
than Waltrip? Not likely. DEI needs to hold their ground on Waltrip’s value, and if
Napa bolts, find another sponsor. Waltrip’s good enough to attract one (if DEI’s
business development folks are worth their salt).

And one other thing…DEI needs to keep their dirty laundry private. PR people are
hired to communicate business issues with the press. Use them.

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