Monthly Archives: July 2007

BACK TO THE BUSINESS OF NASCAR

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A couple of months ago I highlighted a new book, “Silent Speedways of the Carolinas,” by Perry Allen Wood. I’m currently reading it while on sundry vacation trips. What has caught my attention — and that was early on in the book — was how much the many, many people involved in the early “strictly stock” racing were so committed to the sport for the sport’s sake.

Now when I pick up a newspaper or open NASCAR.com, I’m immediately inundated with news of “the BUSINESS of NASCAR”.

Consider the recent Busch mergers of Hendrick and JR Motorsports and Childress and Harvick. On one of the NASCAR-themed TV shows this past Monday, a discussion was held on the possible sponsorship of Jr. by Pepsico — to the tune of a possible $30 million deal.

We also are reading about Yates teaming with the open-wheel organization of Newman/Haas/Lanigan. And don’t overlook the DEI/Ginn deal, preceded by Jack-in-the-Hat and Fenway. There’s also talk of Evernham getting together with someone with $$$.

I’m beginning to believe that NASCAR may be making the same mistake as F1, becoming the “champagne racing league” instead of remembering its “down-home” roots. My colleague Mike has lamented on several occasions that NASCAR may become a league of five-six multiple teams, despite NASCAR’s limiting to four the number of teams held by an owner.

If you’re interested, look up who has won races the past three years — I think there’s just one winner from a one-car team (I’m writing this while at the beach so I don’t have the statistics in front of me — I’ll publish them another time). So the BUSINESS of NASCAR is alive (and well?).

What do you think — too much BUSINESS and not enough racing?

Is that a good thing?

Jon

DEI-Ginn Hookup

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So is this news or what? Nah, probably more of the ‘so what?’ factor as a struggling team does what we see in my Strategy class all the time, namely, merger/sell-out in order to survive. After all, you can’t win races if you don’t exist (of course you don’t have massive cash outflows either if you are in ‘vaporland’).

So this hits the airwaves but I’m not surprised — not that I have an inside pipeline to either operation, rather this is IMO a common business practice. Now the real question is what the impact will be for all the other folks (you know, those behind-the-scenes folks who don’t get much press who work for these teams) involved.

Joe Menzer writing on NASCAR.com even opined that:

“Ginn had an escape plan at the ready. For how long, who knows? Maybe this was his plan all along — to come in, fix up a race operation like it was an old rental property in need of some curb-appeal repair, and flip it for a profit like a real-estate developer does.”

Ooh, strong words! Does this mean that NASCAR teams actually have real economic value? Yes, my friends it does. And this is where another facet of capitalism is reflected in this sport. You are not bound by law to stay any longer than you have a written promise to do so and if you see an entrepreneurial opportunity then you are free to ‘go for it’ .

In the end what this really signals is that it is getting just too expensive to remain a “B” (or C) level team because cash talks and everyone else walks, and it takes mucho cash to play this game.

So are we becoming the domestic version of F1 racing? I hope not…

But hey, be of good cheer: no dogs or gambling debts are involved and we are not in need of “B” samples.

That’s the view from here

Michael

THE UBIQUITOUSNESS OF RACING!

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Quiz Time: What do these people have in common: Susan B. Anthony, George Eastman, Mark Twain, Dr. Konstantin Frank, Rod Serling, and Danica Patrick?

They’re all highlighted in “Finger Lakes…Just the Right Touch”, a column appearing in the Official 2007 News York State Travel Guide. For the record, Ms. Anthony is a noted women’s suffrage movement leader from Rochester. Dr. Frank began the vinifera grape wine revolution in NY while at Cornell University in Ithaca. Mr. Serling, originally from Syracuse, is perhaps best known for his “Twilight Zone” series. Mr. Eastman is considered the Father of Modern Photography and centered his work in Rochester. Mr. Twain authored his famous Huck Finn and Tom Sawyer masterpieces from his study in Elmira, which is now located on the campus of Elmira College, just south of Watkins Glen.

Which brings us to Danica Patrick, who needs no introduction except to say she does not hail from the Finger Lakes!

Each entry for the first five notables ends with a web site listing for readers to obtain additional information about the lives and careers of these persons. However, the listing for Patrick gives the Watkins Glen web site for race and ticket information.

But most interesting to me was the fact that Patrick’s entry headed the list of these highlighted individuals from the Finger Lakes region. Which demonstrates once again that, despite F1 leaving the US racing scene, motorsports is BIG BUSINESS (as Mike and I have emphasized repeatedly whenever asked) in the United States.

Also, while vacationing this past week in Montreal, the official calendar of events in Canada for 2007 highlighted the upcoming Busch race outside Montreal.

Glad to be back to racing this next weekend.

Jon

Why I Yawned: The Importance of Brands (and Drivers)

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I have been in Europe for awhile so as you might expect it has been mostly F1 coverage for me. NASCAR there is much like an alien being (think X-Files) to many, but not all, Europeans. We are an oddity — racing yet not quite real racing.

But this post isn’t really about Europeans, Americans, or any other group – it is about brands and consumers.

According to Kevin Roberts (Saatchi and Saatchi — see krconnect.blogspot.com ), people want to know the following:

1. How can I buy stuff and feel good about it?

2. Why does choosing have to take up so much of my time and attention? The Economist tells us that two-thirds of consumers feel constantly bombarded. Bombardment is a twentieth century idea. Connectors will ignite growth in the twenty-first century.

3. What can you offer me beyond price? Wal-Mart’s shift in focus from “Always Low Prices” to “Saving people money so they can live better lives” is huge. It’s smart, forward-looking and brave.

4. What do you really know about me – and what do I know about you? The human thirst for authenticity is intense. It is pushing brands far beyond their comfort zones of smart market segmentation and savvy PR. People talking to people. That’s where we are headed.

5. What have we got to talk about? This is where it gets personal. A lot of brands have nothing interesting to say. They can talk about themselves and be the bores we all avoid, or they can work hard to become the relevant, fun, connected friends we want.

6. Can you keep up with me? This is where it gets tough, fast and tactical. Consumers are way ahead and they never stop pushing. Cool stores, new games, the latest mobile functions. If they can dream it, brands have to try to do it.

I learned that Budweiser and Dale Jr. will soon part ways and — I yawned. So, did I just commit a NASCAR heresy? Maybe I was just tired from traveling or perhaps I am getting more cynical as I age, but in my opinion this is not a big deal.

Brands and drivers part ways on a more or less regular basis. As loyal as NASCAR fans are (and they are mighty loyal) I question whether a fan of Dale Jr. who also happens to enjoy Budweiser will stop liking either. Budweiser has such a powerful image that they can choose most any driver and retain/develop a fan base for that driver.

The larger problem lurking in the weeds isn’t the parting of the ways between two popular ‘brands’ (yes,Dale Jr. is a ‘brand’) but rather a slow, yet steady, decline into the darkside of driver ‘sameness’.

Just examine those six questions — I think NASCAR probably has. When the day arrives that questions such as these cannot be answered to the satisfaction of the fans, NASCAR will have a real problem.

So now is the time to consider the future and I am betting it is far beyond issues such as the Car of Tomorrow.

That’s the (somewhat hazy) view from here.

Michael

INDY SERIES VERSUS NASCAR

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I had the opportunity to attend the Indy Car race at Richmond International the weekend before July 4. It had some interesting moments, especially with the sky divers arriving just before the race. Still, 241 of the 250 laps were led by the same race driver. And basically, the race was a run-away for him. At least Danica had a good evening, finishing sixth.

This past Saturday I tuned into the Pepsi 400 from Daytona. I liked the new screen format but was a little distracted by the pop-up ads, especially since the audio of the race was muted. But what impressed me the most was the quality of the racing, the lead changes and most certainly the dramatic finish. I sat back and mentally compared these two races: 19 Indy cars, 43 Nextel cars; 250 laps (3/4 mile track results in 187.5 miles versus 200 laps (2.5 mile track results in 400 miles); around 160 mph for the Indy cars and around 185 mph for the Nextel cars; virtually no lead changes in the Indy race with 27 lead changes in the Pepsi 400 race.

For me, I’ll take close wheel driving versus open wheel any weekend. If you watch both types of races, it’s not difficult to see why NASCAR racing is TV’s number 2 sporting event.

Hope you see it my way as well.

Jon

SOME THOUGHTS ON THE “NEW” NASCAR SERIES

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Apparently, the “powers-that-be” at Sprint felt that NASCAR fans could handle the name change going into 2008. In fact, if enough publicity is given over the course of the remainder of this race season, the switch-over next year will probably be quite smooth.

However, I question why Sprint waited so long in making the change. Yes, it was the Nextel Cup series for only one or two years before Sprint took over so there might have been confusion for some not-so-knowledgeable fans.

The issue of AT&T taking over the “new” Cingular, so that it’s just one company name and logo, might also have played into the equation.

In any case, I like the image of “sprint” in the series name — hope nobody starts confusing the series with the “sprint” cars that currently run!

Jon