Race Car Sponsors: Peddle to the Metal

By GREG JOHNSON

Sept. 3, 1998 12 AM PT

What do you get when you combine “Baywatch,” America Online, NASCAR and the California Science Center?

Sports marketers will find out this weekend when the Ford L.A. Street Race snakes through Exposition Park before emptying onto straightaways on Exposition Boulevard and Figueroa Street.

NASCAR’s first street race in Los Angeles won’t draw many big-name drivers, and the event is sure to have its share of unexpected hitches. But, like NASCAR races nationwide, the street race in the organization’s Featherlite Southwest Series is sparking interest among corporate sponsors interested in reaching the group’s fans, who are increasingly female and steadfastly loyal to sponsors whose names they see at the track.

This weekend’s contest takes on added importance because the Exposition Park course sits in the heart of Los Angeles, the nation’s largest car market, and is just a short drive from Orange County, the fourth-largest market behind Cook County, Ill., and Dallas/Fort Worth.

Familiar automotive names such as Ford Motor Co. will use the Labor Day weekend race to market their wares (in Ford’s case, street-legal versions of the 700-horsepower Taurus sedans that many top NASCAR drivers favor). But a new breed of sponsors also hopes to benefit from racing’s booming popularity.

That’s why the California Science Center in Exposition Park is buddying up with Southern California Ford dealers to give away a Ford Taurus. And why “Baywatch” will have its cameras rolling during the race for an upcoming episode featuring AOL’s new NASCAR racing team.

Executives at the nonprofit Science Center initially were bemused when race organizers invited them to use the race as a marketing tool.

“It took some real out-of-the-box thinking to make a case for a tie to the race,” said Leonard Aube, the center’s senior vice president of development and marketing. “But what’s happening is that we’re taking two premium brands, NASCAR and the Science Center, and finding a new, compelling way to bring them together.”

The same is true of AOL’s date with “Baywatch.” “Our job is to reach the mass audience,” said Chris Geisert, AOL’s senior manager for brand promotions. “And with ‘Baywatch’ having a billion viewers worldwide, that’s definitely a mass audience.”

NASCAR, the 50-year-old privately held stock-car-racing organization based in Daytona Beach, Fla., is a finely tuned marketing machine that boasts some of the sporting world’s most alluring demographics. Two-thirds of its fans earn at least $30,000, and nearly 75% of them own their homes. As for the stereotypical racing fan who heads to a track for a weekend of drinking beer under the sun? Nearly 40% of NASCAR fans are female.

To the delight of sponsors, racing fans do pay attention to the flurry of decals covering car bodies. “Brand loyalty among NASCAR fans is much higher than in any other sport,” said David Carter, a Los Angeles-based sports marketing consultant.

Motor sports now draw $1.1 billion in corporate sponsorship dollars, according to IEG Sponsorship Group, a Chicago-based sports marketing firm.

Auto racing does face possible speed bumps, however.

Sports marketers caution that the fast-growing sport will eventually reach a saturation point because consumers have so many entertainment alternatives to choose from.

Marketers question the wisdom of remaining so closely tied to tobacco companies. Winston cigarettes, for example, is the highly visible sponsor of NASCAR’s most elite racing series. Some sponsors are grumbling about a bitter Indy car circuit rift that pits the better-known CART operation against the upstart Indy Racing League.

NASCAR is content to stick with the brute power afforded by its all-American lineup of Chevrolet Monte Carlo, Ford Taurus and Pontiac Grand Prix cars. But some observers wonder if the group might eventually make accommodations for the steadily increasing number of younger racing enthusiasts who prefer sophisticated engines made by foreign companies like Honda and Toyota.

Despite the caution flags, consumers can’t seem to get enough of racing.

Auto Week magazine’s annual fan guide now lists 10 major sanctioning bodies and nearly 60 tracks where top drivers test their mettle.

When fans aren’t at the track, they’re likely to be watching races on television. During a recent August weekend, the TV networks ran a dozen different racing programs, including the NASCAR Pepsi 400, the CART Texaco/Havoline 200, the World of Outlaws Amoco Knoxville Nationals and Formula One racing from Hungary.

As fan interest booms, racing’s dependence on auto, tobacco and beer companies has lessened. Circuits and teams now count the likes of Dell Computer, McDonald’s, Simmons Beautyrest and General Mills as sponsors.

NASCAR’s sponsor ranks include Budweiser, Coors, Mattel and the Cartoon Network, as well as retailers Kmart and Circuit City and tractor makers Caterpillar and John Deere.

When AOL began researching possible sports marketing links in 1997, “we were getting 75 sports sponsorship proposals a week,” Geisert said. “Fifty of them were from racing teams looking for sponsorships. And even now that we’re sponsoring two [NASCAR] teams, we’re still getting 25 calls a week.”

Racing may never completely shed its good-ol’-boy image. But at a time when baseball stadiums are adding private bars and lavish dining rooms, race course operators are laying down the red carpet for fans and corporate sponsors.

Consider a recent advertisement that racing legend and track operator Roger Penske ran to promote his company’s tracks: “Comfortable seating. Magnificent views. Efficient parking. Friendly ushers. Spotless restrooms. Good food. Oh, we almost forgot, there’s the racing.”

Motor sports are “fighting for the fan’s attention and disposable income,” said Les Unger, Toyota’s national motor sports manager. “So you’re seeing a tremendous investment made by people who own existing [racetracks] or who are looking to build new ones.”

Just as technology is making racing machines more sophisticated, corporate sponsorships also are reshaping the sport.

When Toyota broke into racing in the mid-1980s, corporate sponsorships purchased little more than car signage and personal appearances by drivers.

Toyota made a significant investment in sports car races where it could plug the multivalve engine technology found in its Celica line. The premise was simple: If top sports car drivers were winning races with Celica engines, consumers would be more likely to park them in their driveways.

Toyota provides sophisticated racing engines to CART teams. And it’s no longer trying to sell a specific car line. Instead, it is chasing the “halo effect” that a successful racing campaign can generate.

“You can compete against Mercedes, Cosworth, Honda, all the companies with healthy international racing images,” Unger said. “Motor sports is a form of advertising--you can put your dollars into billboards, TV and print ads, or you can use them in an arena like racing where you can showcase the essence of your company.”

Racing sponsorships have grown as intricate as the finely tuned machines that roar around the track. Toyota, for example, sponsors two teams in the CART FedEx Championship series--but because racing is so expensive, the teams also seek out additional corporate support.

One of the teams recruited Castrol as a major sponsor, while the other is allied with MCI.

The two sponsors do far more than pump funds into the racing teams’ bank accounts. During the racing season, Toyota invites hundreds of dealers to its corporate hospitality tent--where they rub shoulders with salespeople from Castrol and MCI. As a result of the affiliations, hundreds of Toyota dealers buy oil products from Castrol, and MCI handles half of Toyota’s long-distance and business communications services.

Toyota also uses its racing links with Castrol and MCI to reach customers outside the racing world who buy oil and use telephones but who haven’t the slightest interest in motor sports.

“If you’re just focusing on reaching the motor sports audience, you’re not reaching the maximum potential of racing,” Unger said.

For drivers, it doesn’t matter if you’re at the top of the NASCAR heap or working your way up from the bottom--the key is to find sponsors. Corporate sponsorships are vital in a sport where an engine can cost $30,000 or more.

Keith Spangler will make the short drive from his cluttered garage in Northridge to Exposition Park this week for speed trials that determine which drivers will earn starting slots in this weekend’s NASCAR Featherlite Southwest Series race, the minor league of the NASCAR circuit.

Unlike most Featherlite drivers who will be racing this weekend, Spangler enjoys the added edge of a corporate sponsorship. For several years, Agoura Hills-based Card Service International, a provider of credit card processing services, has been pumping funds into the 28-year-old’s racing machines. In return, he plasters the company name on his car and makes personal appearances.

Spangler hopes for a solid showing in Los Angeles because Card Service is refocusing its ad dollars and withdrawing from racing, he said. If a new sponsor doesn’t appear, Spangler might rent out his cars to other drivers.

“Hopefully, it won’t come down to that,” Spangler said. “But at this level, finding a sponsor is hard. Nobody wants to talk to you until you’ve already got it made.”

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Tracking the Audience

Nascar’s demographics show that about two-thirds of its fans earn at least $30,000 and 27% hold professional or managerial jobs. Another statistic sponsors like is that motor sports draw an audience that is 38% women.

Household Income

less than $10,000: 7%

$10,000-19,000: 14%

$20,000-29,000: 17%

$30,000-39,000: 19%

$40,000-49,000: 14%

$50,000+: 29%

Occupation

Professional/Manager: 27%

Technician/clerical/sales: 21%

Craft/precision: 13%

Unskilled labor: 10%