Wednesday, June 25, 2014

Loss of Big-Name Sponsors a Glimpse into NASCAR's future?

Remember the days when you could identify a car just by looking at the sponsor on the hood, those iconic cars that carried the Tide, GM Goodwrench and Kellogg's logos?  Remember supporting a particular product because your driver wore their firesuit? Remember the special races where the iconic cars would sport a special paint scheme, and it sort of felt like Christmas?

Those were good days.

These days, sponsors are on and off the car faster than a revolving door on a busy New York City building. Companies opt for partial sponsorship of a season, or sign "just a few races" deals. This week, another longtime sponsor, The Home Depot, announced its plans to pull out of its current full-time sponsorship of the Joe Gibb's Racing No. 20 car, driven by Matt Kenseth, at the end of this season. The 20 car has been co-sponsored by Dollar General and The Home Depot for the last few seasons, culminating in full-season sponsorship and much needed funds for a top-performing team.

As another seasoned backer of our sport gets ready to walk away, I have to wonder, are we seeing the future of NASCAR laid out before our eyes? Why are big-name players and 36-race sponsors suddenly so hard to find?

Is it lack of money? Not in the case of The Home Depot, who reported annual sales of over $78 billion for fiscal year 2013. In comparison, Lowes, which sponsors the No. 48 of Jimmie Johnson full time, reported $53.4 billion in sales in 2013. With The Home Depot outperforming Lowe's by some $20 billion, I would venture to say money is not the issue.

What is troubling about this whole situation is the fact that this is the second major sponsor to walk away from Kenseth in the past five years. Longtime sponsor DeWalt left Kenseth's No. 17 car at the end of 2009. The result was an underfunded race team that struggled for the remainder of Kenseth's career at Roush Fenway, only managing to pull together a handful of wins. In the three seasons after DeWalt's exit from, the team won only three times. At the end of the 2012 season, Kenseth announced he would leave Roush Fenway Racing to pursue a full-time ride with Gibbs. A fully sponsored and energized team did wonders for him, and they went on to win an astonishing seven races, something almost unheard of for a first year driver/crew-chief combination.

Why are companies leaving our sport? What has changed over the course of the past 20 years that has led companies to believe they no longer benefit from television time and sponsor plugs from drivers, as well as loyalty purchases from fans?

The empty stands at the racetracks may be one indication. Most likely, companies are hard-pressed to shell out the kind of cash (anywhere from $5-$35 million annually) it takes to fund a Cup team, when some races are only at half capacity (empty seats at Bristol?). CEOs and CFOs may see that as a waste of resources, and allot the money to other marketing sources.

The consistency of NASCAR as of late may be another factor. In the past eight years, NASCAR has seen only three series champions. Jimmie Johnson won a record five championships in a row before Tony Stewart and Brad Keselowski each took home the hardware. Johnson won again in 2013. Fans have become complacent about the Johnson camp, tired of seeing the same car win all the time, and many are jumping ship.

Many are tired of the politics and constant rule changes in NASCAR. The seemingly exciting Chase for the Cup has done little to bring in new fans, and the older fan base doesn't agree with the ever-changing format, and many are losing interest.

So now, our sport is in limbo. New fans are not coming in as fast as old fans are exiting. Ratings have dropped, and for companies, that means it's time to take a hard look at the bottom line, where resources are being spent. Those hard looks have dealt some even harder blows to teams. It has to weigh on a driver's mind as well, as he or she wonders how the next race will be funded, or if the team will have enough money to run next season.

When asked his thoughts about The Home Depot leaving the No. 20 car, Kenseth sais it was not something he was concerned about, and he really didn't know too much about it. He did express his gratitude to the retailer for their loyalty to Joe Gibbs Racing over the years, and reiterated that his team's main focus was to get their cars into the Chase.

This is a dangerous crossroads for our sport. Teams need the money to function, and companies want the face time a top tier team gives them. If we can't find a way to grow our fanbase and fill the seats, we may be subject to the revolving door of sponsors for some time.

And that is a future we just can't afford.


  1. For sponsors its all about the ROI (return on investment). These companies aren't reducing their ad budgets, so obviously they see better opportunities elsewhere. And of course they have no obligation to continue to support something that provides them less and less benefit.

  2. Some sponsors are there only because their direct competition is sponsoring a car or cars. If the competition leaves NASCAR, their main reason for spending the hugh amount of money is gone. I would not be shocked if Lowes drops to an associate sponsorship or leave totally. With the drop in interest NASCAR has had in the last few years, they might feel they can spend their ad money elsewhere and get more return for their money.

    1. Another thing is that the climate for anything related to the automobile is headed to "green" in a big way. While we may not agree, and there are certain manufacturers still pushing the high performance theme its not lie when we were young. The times have changed and the old days aren't coming back.

  3. Or it could be that Arthur Blank who is the founder of Home Depot is funding more then half the funding for the "new" Atlanta Falcons football stadium, an NFL team that he owns. Mr Blank will gain more of a return on his investment from the stadium for an NFL franchise that he owns then paying for JGR's race team.

    A stadium that we do no need but who am I to tell him how to spend his billions.

  4. NASCAR Cup racing has lost over 2,000,000 tv viewers. Probably 1/3 of paid Attendence. And the teams want more money from sponsors. Common sense tells one that the value in sponsoring a team just isn't there anymore. In addition the ratings continue to shrink so why would a potential sponsor want to sign a long term contract knowing the value may very well decline. The sport had great growth with very little change over the years and then Mr. Brian decided he had to fix something that wasn't broken and drove fans away. The media jumped on the band wagon with him and the rest is history. The chase has not accomplished what it was designed to do and that was to increase the fan base. It did the opposite and that is why they keep changing it. And the changes don't work because fans do not accept it the first place. They have manipulated this sport so badly that it is very doubtful it can ever return to its previous glory. If they have any confidence that it will grow tell me why they are reducing the seating at all of the speedways.

  5. Although it probably has very little affect on your thesis, Matt Kenseth won six races from 2010 to 2012 at Roush-Fenway after he lost his DeWalt sponsorship. But the facts are the facts, and they must be known before we can properly develop meaningful opinions, no?

  6. I am 66 years old and have been a race fan since my uncle took me to Hickory Speedway at 6. I have lost interest in Cup due to lack of personalities of drivers. Corporate sponsors have neutered them and when some speak out (like the Busch bros.) they are berated as being bad for the sport. I used to go to Cup events or watch then on TV while listening on the radio (and taping them). Now I rarely watch Cup for more than a few minutes (can you say boring). I do watch Trucks and Nationwide and F1 but not Cup. They have lost me as a fan.

  7. My apologies for the error on number of wins between 2010 and 2012. You are correct, Kenseth won three times in 2011 and three times in 2012 before moving to Joe Gibbs Racing in 2013.


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  9. Nascar has to be the most boring sport on the planet, and then ya gotta listen to darrel waltrip and his homosexual brother rant for 6hours.

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