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Replies to post #11248 on Nexus Energy Services Inc (IBGR)
08/25/11 3:53 PM
Securing new primary sponsors for $20 million is a difficult proposition in a weak economy. "The work off the racetrack, between the car owners and sponsors right now, it's probably more competitive than I ever imagined it would be," said driver and owner Tony Stewart at the Nascar media tour in January. The deals get expensive because the rule of thumb in Nascar is that for every dollar you spend sponsoring a car, you need to spend two on advertising and marketing to make the investment worthwhile.
Last week, trivia was about single car sponsorships. It’s true, it costs a lot to put a car on a racetrack week to week – some have said it costs as much as $300,000 just for a single car, perhaps more. That doesn’t include salary for the crew, transportation for the team, a backup car and spare parts, or even the cost to enter a car into a race. So how much do the various areas of a NASCAR car go for? Prime spots for sponsors are the hood, trunk lid, rear bumper, and front quarter panels. A front quarter panel sponsorship can go for as much as $1.5 million for 1 year. That’s right – over a million dollars to have a company logo slapped on 1 of 2 front quarter panels. If you look at a car, it will have several sponsors. The rule is, if real estate on a car is available, then it’s for sale.
What does that $1.5 million sponsorship get a company? Lots. Especially if the sponsorship is on one of the top drivers’ cars. For starters, the logo is displayed to an audience of 100,000 or more at the track, and tens of millions watching on TV. Every time the driver takes the lead, or otherwise gets air time, that’s one more impression opportunity for the brand. If the driver wins the race or finishes in the top 5, the drivers mention their premier sponsors during post-race and winners circle interviews. The major networks conduct pre-race interviews where, once again, the drivers mention their premier sponsors. At the track, they usually have a display booth or tent for race-goers to check out their products, play a game, and pick up freebies. We can’t forget merchandising… premier sponsors are usually on official merchandise from hats to tshirts, jackets, pants, shot glasses, license plate tags, stickers, and more. So for $1.5-5 million a year, it’s not a bad deal, especially since races happen 32 times a year. Oh, and I almost forgot to mention – NASCAR fans are among the most brand loyal fans in the United States. Fastest growing demographic? Women 30-45 years old!
08/25/11 4:17 PM
