Originally created 09/23/99

Racing sponsors have their own agenda



ATLANTA -- By the time Ricky Rudd got the call from Proctor & Gamble, it was too late.

Word that Tide wouldn't return as a sponsor came in July, a full seven months before the start of the 2000 racing season on the NASCAR Winston Cup Series. It might as well have come on the eve of next year's Daytona 500.

"It takes months and months to get something like that done," Rudd said. "Sponsors in this sport don't happen over night."

Fortune 500 companies aren't simply looking for pit passes to races when they splash their corporate colors on the side of a 200-mph, four-wheeled car-turned-billboard. They want to generate business from their investment.

"Sponsors aren't that interested in winning," Rudd said. "It's all about marketing plans and strategies. If you win a race, it doesn't mean a whole lot when you're looking for a sponsor. What matters is if you can help them sell their product."

The cost of sponsoring a car on the Winston Cup Series isn't cheap. In fact, the going rate is about $8 million a year.

Some of the smaller teams try to operate on a shoestring budget of about $5 million a year, knowing that every financial corner that's cut turns the chances for victory from remote to impossible. The top teams, like ones that include Jeff Gordon, Dale Jarrett and Mark Martin, enjoy operating budgets of $10 million and more.

For their money, sponsors get formal exposure at the race track, corporate appearances by the driver and the rights to use racing in their national marketing plans. As a byproduct, they get television time.

The National Television Impression Value Analysis, a report from Joyce Julius & Associates of Ann Arbor, Mich., measures the value of direct and indirect exposure a sponsor receives during live broadcasts of races and interview shows during the week. In addition, it gives that exposure a value and compares it to the costs of producing and airing commercials.

Most sponsors have learned that a dollar spent in racing is often quadrupled in exposure value.

"It's also about credibility," said Ron Pyle, president of Pronto Auto Parts, which sponsors a truck race at Texas Motor Speedway. "If we get four times the return of what we spend, we're happy. If we get more, we're real happy. So far, we've been real happy."

Joyce Julius & Associates estimated Pronto received about $13.6 million in exposure for sponsoring the truck race. Not bad since Pronto only spent about $1 million.

Sponsors often center their national advertising plans around the racing circuit. Kingsford Charcoal, a primary sponsor on the NASCAR Busch Series, has devoted most of its national budget to the stock car series. In return, national sales have far exceeded the company's hopes.

Pennzoil, which has been part of the Winston Cup Series for more than 10 years, not only spends $8 million a year to sponsor Steve Park's car, but the Texas-based company spends an equal amount on self-promotion tied into racing.

For example, Pennzoil spent $1,402,750 last year in printing autograph cards. It also spent $469,260 on souvenir tote bags, $715,610 on bumper stickers, $269,375 on team posters and $186,500 on pocket schedules. In all, Pennzoil spent another $4 million in producing trinkets to impress race fans.

"Once a fan attaches a driver to that product, along with having their autograph or knowing they give to a certain charity, they get hooked on that product," Pyle said. "They stick with their driver's brand."

Sometimes the response is overwhelming.

A year ago, Tammy Jo Kirk was a full-time driver on the NASCAR Craftsman Truck Series. Her sponsor was Buford, Ga.-based Luvable bras. Women, who make up about 48 percent of the sport's fan base, were so intrigued with Luvable, they swamped the small company with orders. Luvable couldn't keep up with the demand. After several key deliveries were shipped late, the company was forced out of business.

MBNA, which will sponsor the Busch Series and Winston Cup races this week at Dover, Del., also is an associate sponsor aboard cars driven by Tony Stewart and Bobby Labonte. Joyce Julius & Associates said the level of exposure the credit card company got for its limited involvement in the sport was nearly $9.6 million. Also, Joyce Julius & Associates counted 365,805,946 times when MBNA's name was mentioned or shown in the media, either directly or indirectly.

"This is why these things don't happen over night," Rudd said. "It has to go through a lot of channels. It has to fit perfectly into the corporation's image and plans for the future. It's actually not about racing. It's about being a company spokesman."

And done properly, it keeps Wall Street happy on days when a car finishes dead last.

"When the race ends," Pyle said, "you're always in the winner's circle."