Monthly Archives: September 2010

Is the thrill of NASCAR gone?

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After attending my first NASCAR Sprint Cup Series race at Richmond International Raceway, I made an observation about the empty seats at the track. Other sports organizations such as NFL and MLB have been seeing an increase in viewership and attendance. So, why is there a decline in attendance at the race tracks and viewership on TV? I speculate that the recent economical crisis has had a significant impact. In this financial environment, people have been lucky to keep their roof over their heads since money is tight. One thing is for certain: it becomes clear that what one wants and what one can do financially may not be the same. I also speculate that the interest of NASCAR is declining due to the lack of rivalries among the NASCAR drivers and the lack of rear car bumping leading to spinouts and accidents, which really draws attention and gets the adrenaline flowing. How many times this season have you notice feuding among drivers? I’m pretty sure you can count them on one hand.

Another thing that is rarely seen in recent competition is the bickering among drivers and the pushing and shoving while on the track. Maybe having good sportsmanship or not wanting to cause conflict has taken all the action away. Another speculation of why the interest of NASCAR has declined is the fact that Jimmie Johnson has won the “Race for the Chase Sprint Cup Series” for the last four consecutive years. The fact that Jimmie Johnson has won the Chase have some wondering if the Chase is rigged, if he has an advantage over everyone else, or if he’s just that good. People are tired of the same old same old results occurring; they want change, but not too much change. Finally, the alternative ways of tuning into NASCAR is another speculation as to why popularity is declining. NASCAR no longer has to be watched on TV; it can be watched online through computers or other electronic devices, listened to on the satellite radio, recorded on DVR or TIVO, or watched by catching the recap of ESPN SportsCenter when it airs. It can be speculated that all of these factors are impacting the declining interest of NASCAR. So, what can be done to get the adrenaline running again in NASCAR? CB

NASCAR and Sponsorship–Is It Worth It?

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All marketers are essentially working for the same thing, introducing their product to new consumers and developing a lifelong customer relationship; the smart marketers invest in NASCAR. Studies have shown the brand loyalty between NASCAR sponsors and their fans is stronger than the loyalty between average consumers and their products of choice. It’s a pretty simple relationship: “I like Dale Earnhardt Jr., and he drives for Amp Energy Drink, therefore I like Amp,” and a new customer is born. The above example is easily changed to other drivers/ sponsors/products. Generally, this relationship lasts for years and in some cases passes from generation to generation. Yes, it can cost a company millions of dollars a year to be involved in the business of NASCAR, but spread that train of thought across a few million people and your ROI goes off the chart. There’s no denying that sponsorships in NASCAR cost a pretty penny-but for the most part, it’s worth it. CS

DIVERSITY AND NASCAR

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When I originally thought of NASCAR, I saw it as a white sport, but I also thought they wanted to keep it that way as well. Recently I signed up for a NASCAR business course VCU offers in its program. In that class we discussed that NASCAR has actually developed a diversity program that involves not only trying to attract more fans, but attract more minority drivers as well. In fact, we met two of the drivers currently involved with the show “Changing Lanes”, which is a reality series shown on BET. If this is not a major step in the direction of diversifying the sport, then I don’t know what is.
We also discussed how Juan Pablo Montoya alone has led to NASCAR being aired and translated in over twenty different countries. He alone has attracted not only a large Hispanic following, but other minorities look to him as well. I believe they do this because they see him as someone other than the typical white or “Southern” guy. This is a positive thing for the sport, both for the business side as well as the ethics side. More fans means more sales. WJ

Run the Race or Go Home

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Of all the topics covered so far about NASCAR in our Business of NASCAR class, the one that confuses me the most is the “Start and Park” racers. These are racers like Joe Nemechek, Dave Blaney, Todd Bodine, and Michael McDowell who will qualify for a race, run maybe fifteen to thirty laps, and then park their car due to “engine trouble.” They then collect a big fat paycheck for showing up and go home. These racers are a hotly debated topic in the world of NASCAR racing. On one hand, allowing these guys in the races keeps forty-three cars on the track, which makes for more exciting races overall. They also aren’t hurting anything or anybody, even making the later laps safer for the teams who stay in, who no longer have to contend with so many cars on the track.

The other half of the argument is the one I agree with more. Why are you letting racers who have no intention of even trying to win be allowed to run in the race? Granted, many times, it’s not the racer’s fault. Some teams just don’t have the money to run a full race. With the economy the way it is, sponsorship dollars aren’t exactly flowing freely. My irritation comes from more of a managerial, business person standpoint. Letting these racers start and park is like letting an employee stay in the company who only does a quarter of the work you expect him to, and then paying him six figures to do it. It’s ridiculous and frustrating, but most of NASCAR seems to think of it as a necessary evil. Heaven forbid they race with less than forty- three cars.

Some articles I read on the subject stated that NASCAR has started pulling the first car to start and park in each race as one of the vehicles they do random inspections on. Maybe that’s a sign that NASCAR, though allowing it, certainly doesn’t condone it. AT

No Gas!

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During this time of rising gas prices, how will NASCAR adjust to the cost of one of its most costly resources? Also, how will NASCAR evolve or adapt when its most important resources (gas) begins to be replaced by “green” fuels? If NASCAR doesn’t begin to adapt to changing environmental situations, will NASCAR will be no more?
One more thing, I believe NASCAR should either retire certain drivers’ numbers or allow owners or drivers from different teams bid for legendary drivers numbers. NASCAR would receive a lot of money from the profit they will make during the auction for the numbers, for example, the legendary #3 AC

BARGAINING POWER OF NASCAR ON THE WANE?

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Considering declining TV ratings and attendance at most all of the tracks, both of these issues have significant impacts to the business aspect of NASCAR. One impact is that the teams may lose sponsorship value and another is the ability for NASCAR to be able to negotiate better rights deals in the future. The ratings for Sprint Cup races are down 10% and viewership overall is down 8%, which is estimated to be a loss of 500,000 people per race.

Track attendance dropped 10-15 percent last year, which has resulted in a revenue loss of 17.2 percent at ISC tracks alone. Scenedaily.com stated “Consider this: International Speedway Corp., which plays host to 19 of the 36 Cup points races, took in $195.5 million from ticket sales last year. It took in $192.1 million from NASCAR television rights – revenue for which it doesn’t need any advertising or marketing campaigns.” Nevertheless, sponsors don’t like to see empty seats, because in their perception, they may believe that the interest in the sport of NASCAR is vanishing. HB

MORE AFRICAN AMERICAN INVOLVEMENT IN NASCAR

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NASCAR has struggled to create diversity and encourage young minorities to show interest in the sport for awhile now. NASCAR is over 50 years old, and in that time only three African-Americans have made it to NASCAR’s top series. Many believe that the only type of people interested in NASCAR racing are male Caucasians, but that is far from the truth. NASCAR is the number two sport on television in the United States, and has a massive loyal fan base of 75 million people!
NASCAR wants to encourage more minority involvement in racing, because this increased involvement would help them to reach a huge portion of the population that has not yet embraced the sport. So far they haven’t made too much progress, and that’s because they aren’t focusing on attracting the attention of the children. They need to realize that youth programs open the door for diversity because then the children can become interested in the sport at a young age.
Recently there has been a decline in attendance at the NASCAR races, and there has also been a decrease in TV viewership. A great way to increase these numbers would be to try to diversify the sport not only to African Americans, but to other countries as well. Bringing more minorities into NASCAR makes the whole sport better overall. Better competition, better business opportunities, better employment opportunities, and more fans. Hopefully within the next few years NASCAR can begin to actually show progress in trying to diversify the sport, and provide more interest programs for the youth. DS

LIFE ON THE ROAD (From a vendor’s perspective)

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When walking around the Midway at RIR during last weekend’s race, one can easily become overwhelmed when trying to “dig” through the thousands of options when it comes to NASCAR merchandise. Trailer after trailer lined the midway, tucked in nose to bumper. Each trailer is filled to capacity with a huge range of merchandise ranging from women’s earrings to ornate leather jackets. It’s easy enough to squeeze your way up to the gleaming glass counters and pick out that special t-shirt you’ve been wanting, but do you ever think of how much work is involved in running and setting up these shops on wheels?
Many of these vendors have been on the road for the entire racing season. Most never get a break from being on the road all the way from February through November. In every city, the displays in these trailers have to be rebuilt, mostly from scratch. The bumpy road makes keeping merchandise in the trailer’s glass display cases and on the counter tops impossible during travel. Upon arrival at the track, the trailers must be meticulously cleaned, which may take hours in the blistering heat of the summer. New shipments of merchandise must be retrieved from the track’s warehouse, counted out and then verified and recorded onto a spreadsheet. All of this needs to be completed before the fans start to arrive.
After the race, long after the fans clear the stands, the vendors must count out every single piece of merchandise in the trailers. If they are lucky, the total gross in cash will equal the total gross according to merchandise sold. All too often this is not the case, and the entire trailer has to be recounted to find the merchandise that was miscounted, which can take several hours.
After the finances have been settled, the exhausted vendors must then re-pack all of the merchandise and prepare the trailer for the road. At this point, it is usually the wee hours of the morning and the vending crew has now been on the job for 24 hours straight with no break and possibly faced with an overnight drive straight to the next city where the job will begin all over again. Better grab a coffee! KS

CHANGES FOR THE 2011 NASCAR AND F1 SCHEDULES–The Impact?

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On August 18 Brian France, Chairman and CEO of NASCAR, announced the 2011 Sprint Cup, Nationwide, and Camping World Series schedules. Among the most notable changes are the addition, or “realignment” as Mr. France calls it, of two race events. The first change will be seen at Kansas Speedway on June 5, which will be the second Sprint Cup race of the year at Kansas Speedway. And the other “realignment” of the 2011 schedule will be a new Sprint Cup date at Kentucky Speedway on July 9. This is the first time since 2001 that NASCAR has added a new track to the schedule, those being Chicagoland and the previously mentioned Kansas Speedway.

Under these changes NASCAR seems to want to open its doors to new venues, being the bluegrass state, but also it seems that they are making sure they can fill the seats of these venues. Kansas Speedway and Kentucky Speedway are both 1½ mile tracks, but both have less seating capacity than Richmond International Raceway (RIR), a ¾ mile track. RIR seats roughly 112,000, while Kansas Speedway can fit just over 82,000 and Kentucky Speedway can only seat 66,000. My belief is that NASCAR and the track owners, International Speedway Corp. and Speedway Motorsports, Inc., respectively, want to be sure they can retain the value of their ticket prices.

In other motor sports news the Fédération Internationale de l’Automobile (FIA) and Formula One World Championship (F1) have announced the plans to open an FIA sanctioned event in Austin, Texas. The track is scheduled to open for the 2012 season and will be the first time in over five years that F1 will have an event in the United States. The Austin F1 Circuit will be 3.39 miles in length, feature 20 turns, elevation changes of over 130 feet and top speeds reaching 200 mph in a “proper” F1 car. Renowned F1 circuit architect Hermann Tilke, who has also designed the Bahrain International Circuit and Yas Marina Circuit, which start and end the F1 season respectively, has designed the track. Included in the final design is seating for 100,000 plus fans, and considering it will be five years since the last F1 race was on United States soil I can only imagine that ever seat will be occupied for the entire race weekend. According to the F1 Times, the circuit and its organizers, Full Throttle Productions, are hoping to make $300 million dollars annually for Elroy, Texas and Austin.

The questions I pose to readers are:

How will the “realignment” of the 2011 NASCAR season schedule affect viewership and attendance numbers?

Will the addition of an FIA sanctioned event in the United States affect the 2012 NASCAR season?

JA

The Good Ol’ (New) Spoiler

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With the March 2010 switch back to a rear spoiler, after two years with a wing, Sprint Cup drivers and fans are, for the most part, pleased with the results. NASCAR made the change for the Martinsville race on March 29, seemingly to please the aesthetic taste of everyone wanting a more traditional-looking car. There were no functionality issues with the wing; fans and racers alike simply thought the car didn’t look like a cohesive racecar anymore with a wing sticking out the back. The newly modified spoiler isn’t as aggressive looking as the wing, and not nearly as pretentious. That’s a great thing though because we aren’t talking about your neighborhood Honda four-cylinders with freshly spray painted body kits (complete with, yes you guessed it, a wing.) Sprint Cup cars don’t need fancy body parts to accentuate their obvious power and speed.

Drivers have noted the spoiler isn’t as tall, which allows them to see better through the rear window. Some drivers have felt the car became less stable through turns, while others have felt more grip coming out into a straight-away. Most drivers, however, haven’t noticed anything substantially different with their cars. There may be slightly more drag with the spoiler because it does not allow air to pass underneath it as it did with the wing. Only the future will decide if the spoiler will keep the cars on the track, or send them flipping during the next big crash. In my opinion, if it looks better, works as well if not better, then there shouldn’t be the need to fix what isn’t broken. NS