This past weekend, one of the biggest driver/sponsor divorces in recent memory became public knowledge: Dale Earnhardt Jr. and Anheuser-Busch, specifically Budweiser, will end a nine-year marriage following the conclusion of the 2007 season. The only primary sponsor that Junior’s ever had since he moved up to the Cup series as a part-timer in 1999, the magnitude of this change can’t be underestimated; Junior Nation is famous for the amount of red Budweiser gear that they wear in the stands, sporting clothing and souvenirs that are about to become little more than collector’s items just a few short months from now. Clearly, this change will be a huge adjustment for Junior’s legion of supporters, an adjustment that will literally change the color of the stands on race weekends as the new sponsor weeds its way into clothing collections all over the country. But while the rest of us adjust, there’s one part of this fairy tale that can’t make just a few minor changes in order to live happily ever after – the impact Budweiser will have on the sport. In a move that’s turned into one of the biggest sponsor/driver divorces in the sport’s history, Anheuser-Busch appears to be the biggest loser in a decision they should have been more hesitant to agree to; for when the amount of exposure they’re about to lose is taken into consideration, you can’t help but feel sorry for a sponsor about to have a large chunk of its marketing value taken away.
It’s been reported over the past week that Budweiser was not even ranked in the top five financially in terms of money spent to receive exclusive placement on the car as a primary sponsor in Nextel Cup. While they haven’t been paying the most money, however, Budweiser is by far getting the most exposure of any car in the garage. According to Joyce Julius and Associates, a company based out of Michigan which tracks the amount of exposure a sponsor received during sporting events, Bud received over $180 million in exposure during the 2006 season. That was roughly $60 million more than second-place Lowe’s Department Stores, the primary sponsor of Jimmie Johnson‘s race team. Those numbers are simply continuing a long-term trend; Julius has also stated in the past that Budweiser has been the number one sponsor in terms of exposure since they moved to Junior’s car in 2000. With those numbers in mind, it is very surprising that the company receiving the most exposure in the series, by far, would not feel justified in increasing their investment to stay with their best celebrity spokesperson, continuing what would be the most successful driver/sponsor marriage in the sport.
So why did this change happen? There appear to be several factors involved in this decision by Anheuser-Busch, Hendrick Motorsports and Earnhardt Jr. First off, there are rumors that Hendrick is going to be expecting $30-$40 million to have someone put their name on the hood of the car that Junior drives. Apparently, Anheuser-Busch was not even paying $20 million to be in that position with DEI. Having to nearly double their expenditure on NASCAR sponsorship was a very tall order, and the folks at Corporate Headquarters may be feeling they could get more value for less investment with another driver. Secondly, when Anheuser-Busch left Hendrick to move over to sponsor Junior, the split was apparently not as amicable as some would make you believe. That’s a shame, for when hurt feelings or bruised egos are involved in this business, it always ends up a more appealing option to move on than to try and mend fences already splintered apart.
Most importantly, though, when looking at the switch from Junior’s perspective you can understand perhaps the biggest reason he’s OK with making a change – the man is simply trying to position himself to expand his marketing possibilities. With an alcohol sponsor on the hood of his car, Junior is limited in his options for marketing to underage fans. But by switching to a sponsor like Pepsi, as is so heavily rumored, the 32-year-old can now appeal to all age demographics, making himself more accessible in endorsement packages because there won’t be any concerns by potential sponsors about the negative impact of being associated with alcohol. The motives are clear; as part of this move, Junior seems to be attempting to make himself not only a national personality but an international phenomenon. The recent deal he signed with Adidas is an example of that, a partnership that’s clearly designed to target a global marketplace. While Adidas footwear can be found in any old shopping mall nearest you, the range of the company is impressive; Adidas is a far more recognized brand on an international scale than it is in the United States. With that base to work from, there is a very distinct possibility that Junior’s marketing efforts may begin to push into other countries more aggressively in the near future, especially as he begins to work with Adidas on his proposed clothing line. Should this venture prove successful, expect other international sponsors to hop on board with Junior… all while Budweiser becomes a rather envious observer on the sidelines.
Believe it or not, there is actually some historical perspective in NASCAR on a switch like this one. In 1986, one year after winning a championship and placing second in points, Darrell Waltrip left Junior Johnson to go race for Rick Hendrick, who was going into his fourth season as a car owner and had not had a driver finish higher than third in the points standings. Ironically, Waltrip was leaving a relationship with Budweiser at the time to switch organizations, arguably as the most popular driver in the sport at the point in time that he made the switch. It didn’t take long for the sponsor to recover, though; beginning in 1987, they found themselves aligned with another one of the sport’s true superstars in Terry Labonte.
There are several other driver/sponsor pairings that have become synonymous with each other over the years. Richard Petty and STP is obviously the first and most famous. Jeff Gordon with Dupont is the current senior partnership, with their relationship going all of the way back to 1992 when Gordon debuted in the Cup Series. Tony Stewart and Home Depot is another pairing that are intrinsically linked by the longevity of their marriage. The identification with one driver and one sponsor can become an advantage, giving the fans a uniformity in their appearance as they cheer for their favorite driver. For example, the sea of orange that follows Stewart around or the red nation that follows Junior allows fans to easily identify fellow fans of their drivers and gives them a kindred spirit. Now, that easy “we know what your car looks like” mentality is quickly throwing itself out the window. By switching sponsors, the fans are going to have to decide where their loyalty lies – to the driver or the sponsor that represents them. Let’s face it – when you’re a fan faced with the choice of driver versus company, it’s usually the human that always wins. For the most part, loyalty sticks with the driver, and a whole legion of dedicated supporters will simply look to acquire all new livery in order to show their support. It will obviously be a marketing boon to Junior to have the majority of Junior Nation switch over to the colors of his new sponsor and start wearing a new set of colors to match his paint scheme; hopefully, that transition will come sooner rather than later.
There is no doubt that NASCAR fans are a loyal bunch. They are loyal to sponsors and loyal to manufacturers, but they are mostly loyal to their drivers. While it will be a very difficult change for some of them to accept, most of his fans will follow Junior and sport the colors of whatever sponsor he ultimately aligns with – meaning the sea of red Budweiser shirts supporting Junior will quickly and painlessly disappear over time. In short, it’s a great move for the Intimidator’s son; this decision is going to make Junior a much more marketable personality, signaling a whole new level in his exposure to both fans of the sport and to non-fans, as well. As for Anheuser-Busch, they will certainly maintain a presence at the track, but the decision to not stick with their man will undoubtedly result in a lot less exposure for them. Whether that will have a negative impact on their bottom line, only time will tell.