By THOMAS S. BROWN
Business Writer, Daytona Beach News-Journal
DAYTONA BEACH -- It's easy to imagine someone turning to NASCAR to get advice about motor oil, gasoline or a tire.
But would you check with the stock-car czar to get a recommendation on where to buy insurance, do your banking, quench your thirst or satisfy a hunger pang?
Millions of people actually do, either consciously or subliminally, according to the National Association for Stock Car Auto Racing, which typically rakes in at least $1 million, and sometimes several times that amount, for each product or service that receives its endorsement.
NASCAR is starting its 2008 racing season with nearly 100 corporations onboard with big-ticket sponsorships, more than twice the number it attracted in 2005.
NASCAR's biggest coup in recent months was landing Nationwide Insurance as the title sponsor for its junior racing series, replacing Busch. Although NASCAR and Nationwide executives declined to release the financial terms of the deal, one insider confirmed a Reuters report that $25 million was in the right range.
So why would a company pay that much to have its name publicized at 35 events around North America?
It's all about capturing the attention of 75 million people who take stock-car racing seriously, said John Amand, Nationwide's manager of motorsports marketing.
"If you engage them in a respectful way, it's possible they'll remember you when they get ready to buy some insurance," he said.
The profile of the typical NASCAR-loyal family is especially appealing to an insurance company, Amand added.
"They have 2.3 vehicles on average, versus two vehicles for other households," he said. "They also tend to have more vehicles in the power speed category -- motorcycles, boats, all-terrain vehicles, things like that. They also tend insure their houses at higher limits."
Nationwide isn't the only insurance company raising its banner at NASCAR tracks. GEICO, Allstate and AAA all have lesser degrees of involvement by sponsoring race teams or getting product endorsements at particular tracks. For example, AAA, by paying to be the official car insurance of Daytona International Speedway, will have better visibility for its signs at the Daytona 500 races.
Overall, however, Nationwide is getting a lot of bang for its buck, according to NASCAR. It calculates that all the television camera shots of the Nationwide logo, combined with broadcaster mentions of the Nationwide name, will add up to about $200 million worth of media exposure over the course of the season.
The next big challenge for the NASCAR marketing team will be to find a replacement for Craftsman Tools, the series title sponsor for the truck racing division since its founding 13 years ago. Sears Holding announced in December it would give up the series sponsorship in 2009, two years before its contract was scheduled to expire, but said it still plans to be remain active in NASCAR in other unspecified ways.
Sears, which has been slashing its expenses over the past year, issued the stunning news shortly after disclosing its latest quarterly sales had dropped 3 percent and its profit was now almost zero.
Steve Phelps, NASCAR's marketing director, said he's confident a replacement for Craftsman will be found later this year. For now, his scouts are out beating the bushes, checking to see which corporations are interested in making a bid, and, of those, which project an image that fits with the ruggedness of truck racing.
At NASCAR's highest racing level, the organization is going through another name change -- from Nextel Cup to Sprint Cup -- but marketers don't believe the switch will make much difference to most fans. To some, Sprint Cup, with its reference to speed, seems a more logical choice for racing's top prize than an artificial word like Nextel.
To win over corporate prospects, NASCAR's sales representatives approach them with briefcases full of glowing market research.
"Companies are very attracted to the passion and brand loyalty that people bring to this sport," said Andrew Giangola, spokesman for NASCAR's marketing team in its New York branch officer . "There are lots of studies that show fans remember the sponsors and appreciate their support of racing."
One such study was a 2004 survey of 1,000 hardcore NASCAR fans by the James Madison University Center for Sports Sponsorship. Researchers from the Harrisonburg, Va.,-based center found 48 percent of fans could correctly identify which company held NASCAR's endorsement in nine different product categories.
That same study found at least half the fans could remember which company was the main sponsor for nine of the leading Sprint Cup drivers. More than a third of them could correctly rattle off the sponsors for 30 or more drivers.
NASCAR isn't the only sports conglomerate chasing corporate dollars. Its sister company, International Speedway Corp., sells more than $200 million a year in sponsorships and hospitality packages that allow companies to display their name at Daytona International Speedway and 12 other ISC-owned tracks.
Coca-Cola upped its ante with ISC last year by paying "tens of millions" of dollars for recognition as the "official" non-alcoholic drink at the Speedway and most other ISC tracks for a 10-year period. That gives Coke the right to put its name on Daytona's July 5th Sprint Cup race -- the exact phrasing hasn't been announced yet -- and to have exclusive pouring rights at ISC's concession stands.
Although both NASCAR and ISC are controlled by the France family, sales teams from the two companies operate independently, Giangola said. Both are free to pursue the same target. Consequently, Coca-Cola has become doubly "official," endorsed by both the tracks and the NASCAR sanctioning body.
NASCAR is adept at fine-tuning its product sponsorship categories so it can collect revenue from companies that seemingly overlap. Thus, Snickers gets to be "official chocolate bar" while M&M is just the "official chocolate." Bank of America gets to claim it's the official "credit/debit" card, while Visa is labeled simply "official card."
tom.brown@news-jrnl.com
Living the NASCAR Life
Here is a sampling of NASCAR's endorsed products:
FOOD & BEVERAGE
Beer: Coor's Light
Pizza: Domino's
Wine: Diageo
Soda: Coca-Cola
Cereal: Kellogg's
Cheese Snack: Masterfoods Combos
Ice-cream bar: Klondike
Crackers: Nabisco
Pasta Sauce: Ragu
Chocolate Bar: Snickers
Chocolate: M&M's
Margarine: Country Crock
Mayonnaise: Hellman's
Salad Dressing: Wishbone
PERSONAL FINANCE
Insurance: Nationwide
Bank: Bank of America
Supplemental Insurance: AFLAC
Credit Card: Visa
ELECTRONICS
Telephone: Sprint
Battery: Duracell
Consumer Electronics: Sony
Internet Service: America Online
Satellite Radio: Sirius
Satellite TV: DIRECTV