Sponsorship Worth The Expense
Sunday, January 14th, 2007 10:17am EST
By Luke, Thunder Lounge
Published on Thunder Lounge.
Ever wondered why a sponsor pays so much to be on a Cup car? A recent report from Joyce Julius and Associates, Inc. gives us a small glimpse into the top 10 Cup sponsors and their R.O.I (return on investment) associated with their sponsorship of NASCAR teams and drivers. The top 10 may just surprise you.
So what we have here, is far from a failure to communicate. In fact, just the opposite. This shows just how effective, valuable, and I’m sure profitable as well that a NASCAR sponsorship can be. While the top spot likely won’t surprise you, some of the others most certainly will. So without further ado, here’s the top 10 Cup sponsorships from 2006.
| Rank | Sponsor | Driver | Total Exposure Value* | Team Related Exposure | NonTeam Related Exposure |
|---|---|---|---|---|---|
| 1 » | Budweiser | Dale Jr. | $183.1 | 68.8% | 31.2% |
| 2 » | Lowe’s | J. Johnson | $143.6 | 90.2% | 9.8% |
| 3 » | Cingular | J. Burton | $116.6 | 71.8% | 28.2% |
| 4 » | Home Depot | T. Stewart | $98.6 | 78.4% | 21.6% |
| 5 » | DuPont | J. Gordon | $88.9 | 100.0% | 0.0% |
| 6 » | Miller Lite | Kurt Busch | $71.1 | 84.7% | 15.3% |
| 7 » | NAPA Auto Parts | M. Waltrip | $68.6 | 35.2% | 64.8% |
| 8 » | DLP | T. Raines | $67.6 | 37.4% | 62.6% |
| 9 » | Subway | G. Biffle | $64.4 | 82.6% | 17.4% |
| 10 » | DeWalt Tools | M. Kenseth | $63.3 | 52.7% | 47.3% |
Exposure was monitored by Joyce Julius & Associates during each event telecast of the 2006 NASCAR Nextel Cup Series season (excluding commercials). To determine a value, clear in-focus time and verbal references were compared to the non-discounted cost of a commercial during each respective broadcast. These comparable exposure values provide a standardized measurement for all brands appearing within the series.
* Exposure values reflected in millions.
Table reproduced, and effectively recoded to proper HTML. Original may be found here. (Remember folks, FrontPage is NOT your friend).
Let’s Analyze
The top spot isn’t surprising. He’s freakin everywhere. Not saying that’s bad, he’s a good ambassador for NASCAR, I’m just saying it’s not surprising.
Jeff Burton in the top 5 was a nice surprise. Not saying that he shouldn’t be, but if I’d have guessed at the list it would have been at about 7 or 8 perhaps.
Michael Waltrip instead is in 7th, followed by Tony Raines. Those are your top 10 surprises right there. If you think about it, you would figure that the top 10 would have come from the at least the top 15 in points right? Obviously not. Granted Mikey is a sponsors wet dream come true on Christmas morning, but would you have thought it would have such a big impact?
Let’s talk about average from the top 10 here.
We’re looking at an average of a $96.58M return on investment amongst the top 10 here which, according to the report, is in sponsorship values. A translation for everyday use would be what it would cost the sponsor to buy this type of exposure.
So, with an estimated $15M cost to put their names all over the cars and teams, you’re looking at about a 643% gain from this. Of course some teams had more, some less, and some teams had more contributed than others.
While this report most likely doesn’t take into account the additional amounts of related advertising that sponsors purchased, let’s say for the sake of argument that it was twice what they paid to put their name on the car. Is it still worth it to the sponsors? You bet your biscuits and gravy it sure would be.
If you were a business owner, and could get advertising for half price, wouldn’t you jump all over it? Not to mention that it doesn’t go away completely. How many archived video clips or images have you seen with cars and sponsors no longer associated together? Ah, there you go. Think GM isn’t getting any more exposure off of their previous association level with RCR and Kevin Harvick?
This reminds me of something Kenny Wallace said when I spoke to him last August at Bristol. He said it doesn’t really matter what the car does on the track, because there is so many more facets to the sponsorship picture. Of course a car doing well on the track doesn’t hurt, but this table of information shows that it isn’t all about on-track performance.
As a quick note, you’ll also find on the same page as this information, should you care to look, some information regarding the Truck Series, and Busch Series. Not much of which is surprising, but the information on Craftsman was rather interesting.
So, to sum it up (finally, I know) we can continue to see something that we as NASCAR fans have known for quite a long time. NASCAR sponsorship is worth it, and pays off.
Full page of data available here.
Filed Under: Busch Series, Craftsman Truck Series, Features, Nascar, Nextel Cup, The Water Cooler
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