Aero Performance Products Inc (fka AERP)

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How much does it cost Aeros Exhaust to be a Title Sponsor
"Aeros Exhaust 200" in the Yakima Speedway NASCAR race?

http://www.medialifemagazine.com/news2001/jan01/jan22/5_fri/news2friday.html

Start your engines,pull out your wallets
Rising snit over major NASCAR ad price jumps

By Gabriel Spitzer

When NBC and Fox wrapped up their $2.4 billion broadcast rights deal for NASCAR a year ago, hikes in ad rates and sponsorship fees were a foregone conclusion.
At a press conference, Fox president David Hill joked that ad rates would "double at least, maybe triple."
Advertisers chuckled uncomfortably.
"Hey, why are you putting a cap on these prices?" Dick Ebersol rejoined. More nervous laughter.
These days, with the 2001 season just weeks away, nobody’s laughing anymore.
The increased exposure NASCAR races will get on broadcast television over their former cable deal, and the networks’ need to recover some of the cash they dropped on rights fees, means that only sponsors with extremely deep pockets will be able to afford NASCAR this season.
Already three title sponsors have dropped out of the mix, and many more are still negotiating with the tracks and the networks.
Taking their cue from the most recent PGA golf contracts, NBC and Fox are asking title sponsors of races to pony up additional money, or buy an advertising package, in exchange for on-air mention.
That could effectively double or even triple the cost of sponsoring a NASCAR race.
"It’s certainly a huge issue. Traditionally, the race’s title sponsor has gotten excellent exposure on the broadcast side without having to pay extra. Now the networks are saying there’s a required ad buy for the sponsor to get mentioned on TV. That’s causing a lot of unhappy sponsors," says Shawn Bradley, vice president of client services at the Bonham Group, a Denver-based sports consulting firm.
Not only could the sponsors be forced to buy ad time on the network, but the sponsorship fees themselves, negotiated separately with the race tracks, could jump as well. That means that some of the smaller sponsoring companies could soon be shaken out.
That has already happened to CarsDirect.com, which, along with Sears and Winston, has dropped its title sponsorship deal. CarsDirect.com was reportedly paying nearly $2 million for title rights to the Las Vegas 400, plus a little under $1 million for a media package. Fox reportedly asked for about $2.5 million for advertising alone, and CarsDirect.com balked. Rumors have NBC demanding as much as $4 million from title sponsors for certain races.
"It will just have to be bigger companies that sponsor those races. The sponsorship playing field is really going to narrow," says Mike McCarthy, editor of MotorsportsTV.com, an independent site for fans.
With title sponsorships expiring this year for 11 races, more changes could be on the way. Some sponsors are just trying to get the best possible deal, while others are likely negotiating for their very lives.
"For someone like AutoZone, where this is their primary sponsorship effort, I can’t see them pulling out of this. There are other big players who are more diversely invested in sports, like Coke, where it wouldn’t completely shock me if they got out. They are so well-positioned in other places that they could survive without NASCAR," says Bradley.
Fees for other NASCAR sponsorships will rise as well, as a result of the increased exposure broadcast TV will offer. The cost has just about doubled to sponsor a team and driver.
"Those sponsorships used to average about $6 million, and suddenly they’re getting twice that. A lot of traditional NASCAR sponsors are being priced right out," says Hadrian Shaw, a sports analyst at Paul Kagan Associates.
Sponsorship hikes are one way the networks may be able to recoup their rights fees without passing the entire cost on to advertisers. But ad rates are expected to jump quite a bit as well.
"You're going to pay probably 25 to 50 percent more per viewer, and viewership is going to go up. So ad rates will go up significantly," says Bradley.
This could shape up to be an extremely important season for NASCAR.
On the one hand, the sport is truly going mainstream; whereas last year 10 out of 36 races were shown on broadcast television, with the remainder on cable, this year 28 of 38 will air on the broadcast networks.
On the other hand, the sport risks alienating some of its most loyal sponsors.
"This has always been the most sponsor-friendly sport in existence," says Bradley. "Now that they’re trying to bring the sport into the mainstream, they’re running into the same roadblocks as other sports, with broadcasters being less inclined to give sponsors free exposure."
Because sponsorships are negotiated on a race-by-race basis, don’t expect all the negotiations to be resolved by Feb. 18, when the Daytona 500 kicks off NASCAR’s 2001 season.
What happens in Daytona will have a lot to do with how subsequent races are handled.
"This is certainly a crossroads for the sport. You don’t want to say it’s a make-or-break season, but it almost has that feel to it," says Shaw.