The Frontstretch: No Normal Day at the NASCAR Office by Thomas Bowles -- Monday September 3, 2012

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No Normal Day at the NASCAR Office

Bowles-Eye View · Thomas Bowles · Monday September 3, 2012

 

Tony Stewart and Matt Kenseth: two racing horses of clearly different colors. One loves Indiana and everything in it; the other is obsessed with the Green Bay Packers. “Smoke” will take his temper to your mouth, then buy you a beer; the “quiet champ” of 2003 has the most sarcastic sense of humor nobody ever hears about. One is a self-described bachelor, winning a title on the heels of dumping his girlfriend last September; Kenseth, in contrast, has had two children within the last three years.

Until now, they’ve been tied together by nothing more than a helmet throw, an angry Smoke retaliating for some ill-advised contact that knocked both drivers from a chance of winning Bristol in August. In a few days, perhaps an announcement will leave them loosely connected; Kenseth is poised to take over Stewart’s former No. 20 car, the Home Depot Toyota at Joe Gibbs Racing starting in 2013. But as Atlanta’s competition failed to break the “bad news” cycle, these men dominate the NASCAR headlines for another reason no one wants to talk about.

Sponsorship.

Kenseth, poised to leave Roush Fenway Racing is a former NASCAR champion, has led the points for much of the year and won February’s Daytona 500. For much of the season, he even led the points but yet remains without a full-time primary sponsor to grace the hood of his No. 17. Stewart, a three-time Cup Series champ is also its defending one, winning the title in a thrilling battle with Carl Edwards that came down to the last lap at Homestead. This year, he’s won three times, has clinched a Chase spot as of this writing, and is poised to stage a repeat bid. But all that’s not enough for Office Depot, his primary sponsor in 22 of 38 races this year who’s decided to reduce that number to zero—yes, zero—for 2013.

Despite his success this season, Tony Stewart is losing Office Depot as a sponsor for 2013.

To repeat, that’s two of NASCAR’s best drivers on-track—and two of their most recognizable faces off track—that can’t get major, Fortune 500 companies to sign on the dotted line anymore. In Kenseth’s case, his problems have caused a domino effect, a move to JGR leaving the sport’s anointed “best driver of the next generation” Joey Logano sitting on the street for 2013.

And they’re not the only ones raising eyebrows over the “blank quarterpanel” problem. Dodge, one of the sport’s four manufacturers, is keeping other racing programs going but bolting NASCAR, effective November 2012. Ryan Newman may face a pink slip as well; what’s left of his Stewart-Haas sponsorship is heading to the boss after the U.S. Army decided to march off his No. 39 car. In making the move, the military division made it clear they’re still spending money elsewhere in racing, keeping money inside the NHRA; but their days connected to stock cars are done.

I wish I could say those are the only storm clouds. But that’s like a forecaster saying a major hurricane’s sitting an hour away and telling you not to evacuate, and that the storm is going to miss us. DuPont is selling their paint division, leaving questions as to whether they’ll back Jeff Gordon effective the end of 2013. Budweiser, whose Cup commitment with Kevin Harvick is already reduced to 20 races, has its contract set to expire next November. And to replace them, the number of new full-time owners and teams are… nothing. Well, almost nothing—unless you want to count the jalopies out there running a few laps and then parking it. The start-and-park phenomenon, not the point of this column but the “field fillers” in the case of a dwindling field of competitive entries, have reached 25% of the 43-car grid in some events. And unless Brian France tries to give out free lotto tickets, that percentage is expected to maintain, if not grow, for 2013.

In announcing their departure from Stewart, Office Depot referred to the “changing business landscape warrants a realignment of priorities and resources.” Some may say that pertains to a weakened economy. OK, so then why does Office Depot make commercials and sponsor other major sports? Why are they still negotiating to potentially be the “Official Office Supplier of NASCAR?” Let me read the apologists some real English: that line means, “It’s not worth it to spend the money on sponsoring a car anymore; other things give us more bang for our buck.”

It’s as simple as that. And that would be an acceptable line of thinking if, say, Stewart was running 25th every week. But he’s the defending Sprint Cup champion, purchasing engines and chassis from the New York Yankees of NASCAR, Hendrick Motorsports. Not only that, he’s been in the news consistently this year, whether it be for his Eldora Race for the Dream, that helmet throw or multiple trips to Victory Lane. There couldn’t be a much better selection.

So what’s going on? Why, even with TV ratings about even from last year does the sponsorship market in NASCAR continue to die? There’s a number of theories. One is age: despite their success, both Stewart and Kenseth are well outside that coveted 18-34 years age bracket. Companies look at 40-somethings and worry, the same way they’re concerned about a lack of those “next generation” fans in the stands. Just check out a quote from the Army as to why they’re leaving Sprint Cup:

“We can’t justify the investment in NASCAR as much as can in other things that we are doing,” said Army Marketing Director John Myers. “[The audience is] starting to skew older.”

Older fans? Outside the 18-34 demographic? No Fortune 500 involvement. It gives the impression, to the guys in the suits that the sport is “not hip.” If you want to be extreme, you can even replace that word with “dying.” So, as the economy squeezes advertising dollars NASCAR falls further down the list of where they’ll spend cash, if not taking it out of their budget altogether.

Another issue we could be facing is cost; as the middle class in Sprint Cup has disappeared, a garage full of rich and poor the multi-car owners are still asking for $20 million, $25 million deals, and higher. Compare that with, say, Tommy Baldwin Racing, which is looking for one-tenth of that money just to survive and run every week. The gaps between the “haves” and “have nots” have never been greater, but the “haves,” with bloated race shops of hundreds of employees, don’t want to downsize the people they care about. So they put patchwork deals together, making $20 million out of ten different sponsors as the pool of potential backers grows smaller for everybody else. NASCAR never steps in to cut costs, and… the awful cycle continues.

You would think, after three years of no funded rookie drivers (Logano was the last) and no new team owner involvement, NASCAR would step in and do something. IndyCar, through the way money is redistributed through the teams and their attempts, at least to control cost are getting sponsors to step up; the audience might be there, but the business model is working. It’s a dangerous game when you have the opposite scenario. No matter how many people show up in the stands, turn on that television or buy Tony Stewart t-shirts, they can’t save a bad business model from turning NASCAR’s top teams broke.

When will someone address the problem? When will the top owners come together and try to find a solution? The answers may remain a mystery; and while they do, Office Depot and Tony Stewart are just the tip of a very dangerous iceberg.

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pepper
09/03/2012 12:54 PM
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Why would any Fortune 500 company want Tony Stewart to represent them? His mouth and his infantile behavior aren’t exactly the kind of things I would want presenting an image of my company.

mrclause
09/03/2012 03:30 PM
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NASCAR’s greed is coming back to bite them finally. Brian France listens to no one and admits it. Under his regime NASCAR has made the dumbest moves it possibly could have. Attendance is down at the races and TV as well and he has no clue why. Brian has stunk up the show. The show has become a farce instead of a show. Try attending your races Brian, try listening to the fans you have left, forget all these high priced new hires of yours, no more than you do do they have a clue as to how to keep your fans. You’ve sucked all the sponsors from the teams, you’ve sucked all the racing from the race, the water is circling the bowl Brian.

Ken
09/03/2012 04:08 PM
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As has already been stated, Brian France has successfully taken a sport that thrived, and crushed it to where it is now a joke.

This is a sport, not an entertainment venture. But, apparently, Brian seems to think that making it like the biggest farce next to the WWE is the way to go. That became so painfully obvious when that guy got on the mike at Bristol and pulled that “Are you ready to rumble” stunt. Who was that clown anyway? I’ve never seen him before. But then, I don’t watch any WWE or MMA.

Unfortunately, it is now way too late to save NASCAR. All that will work is to get someone in there to replace BZF, but, since this is a family run operation, there is no hope of that happening. What a shame!

I never really had any respect for Bill Senior or Junior, as I always viewed them as tyrants, bullies, and goons, especially after I read “Driving With The Devil”. But, at least they made it work. Brian is too stupid and can’t wake up, for fear that he would have to admit he was oh so wrong!

Andy D
09/03/2012 04:21 PM
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They’ll never be able to get rid of Brian France, but he needs to give someone else the CEO job while he retires to the shadows as chairman. Much like the Alan Mullally/Bill Ford relationship.

Steve P
09/03/2012 05:03 PM
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It amazes me that NASCAR can find companies to pay them to be “The Offical _____ of NASCAR” while there are championship teams out there with limited sponsorship. Wake up Brian !!! Tell these companies to go sponsor a team. You (NASCAR) will only benefit (read as: $$$) by having as many financially strong teams as possible. Oh, and by the way, more and stronger teams should equal better racing which should solve another problem…

Upstate24fan
09/03/2012 07:12 PM
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Right now the NASCAR business model is broken. Brian and the big owners have their head in the sand and seem to think that once the economy improves everything will be better. They are all naive.

It’s too expensive right now to run and sponsor a competitive Cup team in today’s economy. The big teams got too big during the boom times, and still think they can charge $20-30 a year for sponsorship. Right now all the teams are putting bandaids on a stab wound with these hogpog deals.

It is disturbing when I watch IndyCar and most of the field has sponsorship considering, volleyball on ESPN 2 gets better tv ratings. NASCAR needs to take aggressive actions to control costs, push the “official” companies to team sponsorship and allow telecoms to sponsor teams again. Maybe if one of the big teams goes under, they will take action.

Matt L
09/03/2012 07:18 PM
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Social media and a recession changed the game. People are looking at prices rather than the logos on a car. Paying people to advertise and interact with customers on Facebook and Twitter is way less expensive than a NASCAR sponsorship. You can control your message on social media, you can’t control the driver/team that represents you.

I don’t see demographics playing into Office Depot’s decision. The age of people shopping for office supplies is from the mid-20’s and up. Teenagers are not buying their own school supplies either.

I think for Office Depot, the cost to sponsor a car has just gotten too ridiculous. Look at all the major companies that have departed: Kodak, Texaco, DeWalt, GM Goodwrench, Tide, US Army, DODGE etc. UPS and Kellogg’s only sponsor 1 to 2 races a season. How many wake up calls does the industry need?

I think sponsorship is a cool thing that has lots of benefits that CEOs just don’t see. It makes regional companies nationally recognized. It’s a unique and fun way to advertise (remember the UPS Dale Jarrett commercials?) Office Depot wouldn’t even be on my mind if I didn’t see it on the #14 and Stewart every weekend. But everyone is just looking at the bottom line now. I think some companies will regret pulling out of the sport. But they are sending the sport a message: cut the costs.

NoSpin
09/03/2012 07:29 PM
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Are you telling us that Office Depot demographic 18-34 ? Don’t thing so. NASCAR is taking a little part of a bunch of co. the CEO are saying that good we don’ t need any more.

Sue Rarick
09/03/2012 11:50 PM
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So Office Depot become the official supplier to Nascar and Brian gets more money to line his pockets while car owners end up laying off people.

So Brian should care because???

As long as he gets his money he could care less what kind of show stinks up the airwaves.

 

Contact Tom Bowles

Recent articles from Tom Bowles:

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If you want to know more about Tom Bowles or to view all of his articles here at the Frontstretch, check out his archive and bio page.

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