Dot-coms start your engines By Tim Southers Stock car racing has entered the global economy. Combine the first Japanese-American driver with a car sponsored by a dot-com and you get a sense of where stock racing is headed. "Dot-coms are ...
Dot-coms start your engines By Tim Southers
Stock car racing has entered the global economy. Combine the first Japanese-American driver with a car sponsored by a dot-com and you get a sense of where stock racing is headed.
"Dot-coms are definitely making inroads into racing," says Tim Southers, media relations director for the three-year-old USAR Hooters ProCup Series that now has three dot-coms sponsoring drivers. "There is an increasing amount of money involved in stock car racing as the sport has spread from the southeast to all over the nation into larger markets, with what I call white-collar involvement. With more money and viewers involved, the types of sponsors are changing."
One of the very first dot-coms to sponsor a stock car is Web-based calendar and event planner, DailyDrill.com. The Arlington, Va.-based site is a subsidiary of NC, Inc., touted earlier this year by dbusiness.com as one of 50 businesses to watch.
"I've always been very aware of the power of loyalty that race fans show sponsors," says Ed Neumann, chief executive officer of DailyDrill.com, which coincidentally has as its motto, "Spin Into Control." "We're sort of a fish out of water, but we knew the USAR ProCup Series would give us a good way to test fan loyalty without spending the money we would in a Winston Cup sponsorship."
This season, DailyDrill.com is sponsoring John Kinder, a fourth-generation Japanese-American, who has been racing since age 10 and is a consistent qualifier, if not persistent driver.
"DailyDrill.com is what makes the team go," says Kinder, 25, of Mauldin, S.C., whose team is PowerBase Motorsports. "Without sponsorship money, it's hard to race because you have less chance of competing. Ed Neumann and his company have made it possible for us to go after this series in the way we want to go after it."
DailyDrill.com is an associate sponsor, which buys them the right to place their company name on the hood of Kinder's MultiMedia Chevy Monte Carlo for the 2000 season. Kinder already had built a solid fan base over the years and now hands out DailyDrill.com key chains, hats, and calendars in the regular public meet-and-greets before each race. "I get asked throughout the pits, `what is DailyDrill.com?'" says Kinder. "I tell them it's a free Web calendar and they ask, `How can they sponsor you?!' People are really surprised that we're sponsored by a dot-com. They say you have to be worried about being sponsored by an Internet company what with the fluctuating market, but I just don't see that with the Daily Drill. I think they're going to be in this sport for a while."
While sponsorship rates are a private contract between sponsor and driver, John Kinder's father and coach, Jim Kinder, says it costs racers in the neighborhood of $600,000 per season, or $30,000 each race, just to compete.
"It's been a good relationship for us," says Jim Kinder. "Any time you work with someone who hasn't utilized motorsports for marketing there is a learning curve, but in the long run it benefits both partners."
Neumann, who has already decided to sponsor John Kinder in the 2001 season, agrees. "We're still waiting for some wins. But it's been very successful for us."
More than hard-drinking `Bubbas'
The face of stock car racing has undergone a major metamorphosis. Once thought to be the bastion of good ol' Southern boys drinking and whooping it up, in fact, it is now more of a business, says Southers. Over the last five to seven years, the average annual income of stock car attendees went from $40,000 to more than $75,000. Women are just as likely to enjoy stock car racing as men. With the pits open to everyone and his grandmother and the drivers cheerily accessible to fans of all ages, stock car racing has truly become a family event.
"The beauty of stock car racing is that everybody is equal," says Jim Kinder. "There are no wannabes at the sport. They're all just good people. I've never seen a fight in a race, or witnessed any other trouble. You can entertain board members or factory workers at a car race and that's what continues to attract corporate America."
Neumann looked carefully at the demographics and economics of the average stock car racing fan before agreeing to sponsor Kinder. "There is a stereotype that stock car fans aren't affluent or computer-literate. We're not finding that to be true."
Racing, however, does remain a sport typically entered by whites. "It's just the way it is," says John Kinder, the only Asian American in the USAR ProCup Series and one of the few, if not only, minority in all of stock car racing. "It's not about prejudice or acceptance, it's just a fact of the racing world."
Even in Japan, Asian American athletes generally gravitate toward motorcycle racing or slalom racing, says Jim Kinder, who is of German-Irish descent (John's mother is Japanese). But the Japanese are big motor sports fans, he says, as was evident when John was one of only 28 drivers to be invited by NASCAR's President/CEO Bill France to be invited to Suzuka City, Japan, in late 1997, for a NASCAR Winston Cup exhibition race, and was given a hero's welcome.
"I took my mom and grandmother along with me, which was neat," says John. "The crowd really accepted me because there were only a few Japanese drivers in the race and I was the only Japanese-American driver.
"In the States, I've been doing this for so long now that I blend right in," he says. "I came up the way everybody else has come up through the ranks, and they see me as just another driver."
John's dad feels his son's multi-ethnic heritage has helped give him character and lends an international flavor to an already unique sponsorship deal. "John is able to relate to people as people, as opposed to skin color," says Jim Kinder. "I'm proud to say, he's very personable to everyone."
Unique marketing opportunity
With attendance in the USAR ProCup Series alone ranging from 2,000 to 9,000 a race, there are plenty of fans on hand to notice sponsors' products. Do auto racing fans really pay attention to the sponsors? "Absolutely," says Jim Kinder, an ex-racer himself who's been around many a racetrack. "This is the only sport where money is based on performance. The fans understand that performance is completely dependent on a driver's ability to have top-notch equipment, a crew, and the other racing essentials that they can get only through sponsorship."
Kinder cites a recent study by Joyce Julius & Associates, which found that 75 to 80 percent of all racing fans are influenced in their buying decisions by the sponsor of the car. "They'll have direct recognition if you say the number of the car, the sponsor, and the name of the driver," he says.
Stock car racing began in the Southeast during the Prohibition days of the 1920s. Fast cars and even faster drivers were needed to run moonshine from state-to-state. When alcohol became legal, the former moonshine runners carved out an old dirt field and began racing their cars against one another. When the car races eventually made their way to Daytona, NASCAR was born.
The first season of NASCAR racing was held on a beach/road course on Feb. 15, 1948. From the beginning, a variety of car and auto supply companies offered contingency money, fuel, cars, and parts, and even backed teams. Often, says Southers, the driver's own family would sponsor the car.
It wasn't until the days of Junior Johnson that more mainstream corporate America began to jump on the sponsorship bandwagon and back drivers. Johnson, a NASCAR driver who had run booze for his dad and was short of money, successfully approached R.J. Reynolds Tobacco Company, and with their support, ignited the racing world with his sponsorship coup.
"The Winston brand's association with NASCAR is recognized around the world by race fans and they let us know at the cigarette counter," James W. Johnston, chairman and chief executive officer of R.J. Reynolds, was quoted as saying recently on a Web site. "It's a relationship that has been consistently rewarding year after year."
For many years, auto supply, car, beer and tobacco companies primarily sponsored stock car racing. In the early '80s, however, when stock car racing really began to hit its stride, more family-oriented consumer products -- such as Tide and Cheerios -- became as familiar to race fans as Miller Lite and Valvoline.
With the Internet explosion in the early '90s, it's only natural that dot-coms would next step up to the sponsorship plate. Besides the DailyDrill.com in the USAR ProCup Series, Jay Fogleman just signed NXView.com and John Wood is sponsored by goracing.com. In the ARCA AOL sponsors Andy Belmont.
"The days of going up to a sponsor and asking for help is over," says Southers. "Sponsors want to know what kind of return they'll get on their investment.
"These days a driver's ability is important, but marketability is even more important," he says. "There are a lot of talented drivers who could go a long way, but they don't have the public relations skills to promote a product or pitch their own skills to a sponsor."
Increasing media coverage also has had an impact on sponsorship. For example, when John Kinder hit the wall during a June 3 Lakeland, Fla., race at USA International Speedway, his banged-up car touting "#08 DailyDrill.com" was captured on Speedvision and aired a week later. At the time of the accident, Kinder also was interviewed by a reporter about his damaged vehicle and was wearing a DailyDrill.com hat. In the hours that followed the interview with Kinder, DailyDrill.com had a 400 percent increase in new registered users. No other commercial advertising was running at the time.
"Of course, we don't want anyone to get hurt," cautions Neumann. "But John is an excellent spokesperson and a really terrific guy. He understands the products and always mentions us in interviews. That kind of exposure can't hurt.
"Marketing via motorsports is different than any other type of marketing I've done," adds Neumann. "It's quasi promotions, quasi public relations, and quasi advertising, and it requires a full-time person to manage it correctly. If the appropriate resources are dedicated, it can be a terrific benefit to a marketing campaign." Besides increased name recognition, Neumann has observed several other perks from his sponsorship. "I'm definitely a race fan now!" he says. "I've gone to two of John's races that were within driving distance." And DailyDrill.com's staff of 25, none of whom were prior race fans, also now follows John closely.
"It's been great for comradery," says Neumann. "It's a really relaxing way to bring the staff together to find common ground outside of business."