Welcome to our blog. We are professors of management (and NASCAR fans) who teach a course on the business of NASCAR at Virginia Commonwealth University. We will post regularly on the business issues of NASCAR during the season and will include posts from our students. We invite comments. Dr. Jon Ackley and Dr. Michael Pitts
There is a negative stereotype that circles the world of NASCAR. It is sometimes hard to get people to break their stubbornness and watch a NASCAR race. I feel that there are still many people who do not have the desire to experience what NASCAR has to offer to the sports world. I recently had a conversation with one of my co-workers. I was discussing with her my enrollment in the Business of NASCAR class and she was stunned but also somewhat bothered by the fact that there is a class offered on NASCAR. The questions she presented were “What is so great about NASCAR that they would go as far as to have a class about it? What is the point? It is a boring thing to watch and is not a sport at all.” To the defense of the sport, I generously shared with her the information obtained from class.
What she learned from our discussion made her think that just maybe there is more to NASCAR then 43 cars driving fast in circles. There is an actual business behind the sport. She seemed to become curious about other aspects of NASCAR, which leads me to the reason of the need for NASCAR education for people that have no knowledge of the sport. I think that not only would that be a great way to grow the interest in the sport, but also the viewership, sponsorships and the overall excitement of the sport itself. I talked to one person and answered her questions and left a positive impression on her; imagine what could happen if everyone had that same opportunity that she had to learn about NASCAR. RP
If Jimmie Johnson and Danica Patrick were walking down the street, who would be more recognized? Personally, I have the slightest idea what Jimmie Johnson looks like but I know I could easily point out Danica Patrick in a sea of people. Although her racing accolades pale in comparison to Jimmie Johnson’s, her face is known by millions of non-NASCAR fans worldwide primarily due to her appearances in several television commercials and print advertisements. Why is Patrick so popular? Is it because she is a woman? Is it because she is an attractive woman? Or is it because she has the potential to be one of the most successful drivers in the NASCAR Universe? No matter what the true answer is, executives in the business world have recognized her ability to sell tickets and increase TV viewership and are trying to cash in.
Recently, Danica announced that she will be participating in the 2011 Nationwide series; however, she is only contracted for half of the races. Is this a sign that her team, JR Motorsports, is merely testing the waters or just teasing their male fans? It is unclear how helpful Danica Patrick will be to the sport of NASCAR. Some experts say that she is purely a showboat designed to bring in money and others claim that she is the real deal who is ready to win races and break records. It will be interesting to see how the world reacts to the addition of Danica to the Nationwide races. We can assume she will make money for the sport in the short run; however, NASCAR should be looking ahead to the future and hoping that Patrick will be the gal who wins races and breaks records. While her physical appearance will initially bring in viewers, once her luster wears off only her talent will be able to save her in the end. TD
With sponsors like Lowes, DuPont, Budweiser, The Home Depot, Miller Lite, Jack Daniel’s, and Red Bull, NASCAR sponsors are more appeasing to the male audience versus the female audience. For the month of October some sponsors chose to put a twist on things and appeal to the female audience.
The month of October is recognized as National Breast Cancer Awareness month. To raise breast cancer awareness and to honor and remember those affected by breast cancer, four NASCAR teams took at least one car and tricked it out in pink. In an effort to contribute to the cause, at Lowe’s Motor Speedway near Charlotte, North Carolina, the number 96 car driven by, Bobby Labonte, raced to raise breast cancer awareness to millions of Americans.
The sponsor Ask.com launched a full campaign for the month of October to raise breast cancer awareness among female Americans and all NASCAR fans. Many fans that already have their favorite drivers who they support temporarily chose to root for the “pretty in pink” race car to honor breast cancer awareness also. Among those drivers whose sponsors also tricked their cars out in pick colors to support the cause were Elliott Sadler, Kyle Busch and Bill Elliott.
I think that this promotion was an excellent way to appeal to the female fan base of NASCAR. It shows support for those fighting the battle with cancer and respect for those who lost their lives to the battle of cancer. Breast cancer is the most common form of cancer found in women and is the second leading cause of cancer deaths among women. One in eight women will get breast cancer. I feel that NASCAR’s efforts to educate and recognize its female fan base and millions of female Americans were very effective and efficient. I have three breast cancer survivors in my family and as a female I am statistically at risk also, so I truly can appreciate and respect the efforts that NASCAR took to support the cause in raising Breast Cancer Awareness not only to race fans but also to millions of Americans.
Outside of the support NASCAR gave in raising breast cancer awareness, I still feel that there is a lack of female targeting sponsors within the business. I feel that NASCAR should touch bases with this matter and gain more sponsors to reach and appeal to its female fan base. Although the breast cancer campaigns that some sponsors ran during the short thirty one day month of October were successful in the attempt to connect with the female fan base, I still feel that just that alone isn’t enough and that there should be more.
And that’s the view from here.
Diversity has been on e of the biggest issues in NASCAR over the years. As in the past with people trying to be equal depending on race or gender, in NASCAR too there is a big gap of diversityl. Other sports such as basketball, football, and baseball have been making lots of changes to make the environment more diverse and the results of these efforts are outstanding because they have brought more fans to the sports.
NASCAR is usually seen as a predominately white American sport, while most other sports are trying to become more diverse. Juan Pablo Montoya, a Colombian, who is currently a NASCAR driver, has made a difference in NASCAR. He has performed well in many races and he has done a great job overall. Due to his performance in NASCAR, Juan has attracted many Spanish fans to follow and watch NASCAR. The Indy Racing League has Danica Patrick, who has broken the male dominance of the sport and has given women the opportunity to see anything is possible.
So my concern is why is NASCAR is not so diverse? Why there are no African Americans or women involved as drivers in NASCAR at the upper levels? Why can’t there be a Tiger Woods in NASCAR? Why can’t there be more women like Danica Patrick in NASCAR? All of these are concerns that are very important because I think that by bringing women and other races to the sport a more diverse environment can exist. The biggest result of this diversity would be a more diverse fan base in NASCAR.
The much-anticipated NASCAR Hall of Fame is set to open in May 2010 in Charlotte, North Carolina. In addition to bestowing honor upon those featured in the Hall of Fame, the 130,000 square foot hall will house a museum and entertainment attractions. It will serve as a tribute to the drivers, crew members, team owners, and other contributors to the sport.
The complex will also include a new ballroom and the NASCAR Plaza Office Tower.
Perhaps most exciting for the fans, however, are the multitude of attractions being considered for inclusion in the Hall of Fame. Among those are a racing simulator and “A Week in the Life” (a behind the scenes look at a NASCAR team and race day preparation), and about ten other interactive activities! For more on those, visit www.nascarhall.com.
So what kind of impact will a facility of this magnitude have on the city of Charlotte?
According to John Connaughton, University of North Carolina–Charlotte economist, the economic impact will be roughly $62 million annually! In light of the recent economic downturn, the NASCAR Hall of Fame also may be just the thing to boost revenues for NASCAR in terms of admissions sales and souvenirs. Regardless, it will surely boost Charlotte’s economy, bringing jobs and tourists alike to the city.
I, for one, look forward to learning the exciting new plans still in the making for NASCAR’s first Hall of Fame and Charlotte’s own “Crown Jewel”, as coined by Charlotte’s mayor Pat McRory.
We all know that NASCAR fans are 75% more likely to purchase items that are endorsed by NASCAR or a favorite driver, and 40% of all fans are females with the majority of the purchasing power. So, with numbers as high as these, I don’t see why more sponsors aren’t focusing more on women. A discussion today made me think about what makes a “loyal” fan. A loyal fan is someone who will not substitute another brand based on price or availability. That means that I am not a loyal fan. I don’t feel compelled to always buy something simply because it is endorsed by NASCAR if there is a cheaper substitute. I don’t think NASCAR has any female-only products. I could care less which home improvement store or energy drink is advertised. But I would purchase something that was specifically geared towards women. And not just the stereotypical sponsors like Tide or Target; women aren’t the only people who have laundry needs. I’m talking about brands such as Tampax, Maybelline, Herbal Essences, or Victoria’s Secret.
I think the entry of Danica Patrick would be a great opportunity for sponsors to jump in and target the female fans. I don’t think the men in the sport would jump at the idea of driving the Tampax car, but Mark Martin drove the Viagra car with no shame. I would become a “loyal” fan if a driver, male or female, would seek out a sponsor that supported the primary needs of women.
Many of NASCAR’s race weekends usually last two or three days depending on which race it happens to be. NASCAR has been looking into making more two-day weekends for the 2010 racing season. One of the main reasons NASCAR would like this to happen in 2010 is because of the hard economic times we are facing today.
By making more two-day weekends NASCAR believes it will help save a tremendous amount of money for many of the organizations in the NASCAR circuit. Even though this approach has been considered for years, many people believe this would be the perfect time for NASCAR to go through with this idea. Many fans, including me, do not realize how much money each team could actually save from cutting down from a three- to two-day weekend. It is estimated that it costs a team $300,000 to $600,000 per car for an average three-day weekend.
So by having only a two-day weekend a small portion of that amount could be saved. Also knowing that they have to run a 36-race season, organizations would eventually save millions of dollars within a season. By seeing how much money could be saved, I believe this would be a great change for NASCAR to make most of the races a two-day weekend event.
NASCAR is said to be one of the most viewed professional sports on television. The only sport that beats it is the NFL. NASCAR is broadcast to over 150 countries around the world. It is a multimillion dollar business with millions of fans attending and watching around the world. If all this holds true, then why is NASCAR facing struggles with attendance at events and a drop in TV?
The cause of this drop-off in viewership and attendance is unknown to many. It can be a variety of things. The sport’s best drivers are not competing at the same level and some may think they’re running low on the tank. The new drivers that NASCAR brings in, or will bring in, may not have the same racing vibe as the previous drivers. I can somewhat compare this situation with WWE Wrestling.
At first it grew at a ridiculous rate because it was fairly new and everyone wanted to watch their favorite old school wrestlers duke it out. After a couple years, the attitude of the show, the story lines and the wrestlers themselves were getting old. With new wrestlers coming into the business, fans of the old generation were left hanging and not attracted to something they watched growing up and loved. It just wasn’t the same anymore.
I believe that NASCAR is somewhat going the same way. I may be wrong or I may be right. It is just an idea to provide. Something new may have to be provided in order to remain the big business that NASCAR is. I think something needs to happen to spice things up a bit to give it an edge of entertainment and drama. As some may say, Danica Patrick may be coming to NASCAR. That can tip NASCAR fans good or bad; it all depends on how the fans take it. We may just have to see what the business of NASCAR can provide to its loyal viewers and see if a renewed interest in the sport can begin again.
There has been a lot of talk about the possible addition of Danica Patrick to the NASCAR circuit next year, but one has to ask does NASCAR need her?
Women make up to 35% of the viewer audience of NASCAR, higher than both the NFL and MLB. With the power of the marketing of NASCAR, would the addition of Danica help to open up some market that seems closed because it is a male-dominated sport?
Now may be the best time for Danica to move to NASCAR and help them open up to new marketing partners. With women controlling more than half of the private wealth in the US by 2010, and women being involved in over 60% of new vehicle purchases, women’s purchasing power continues to grow.
With track attendance down, perhaps NASCAR needs to consider expanding its base? But can the men of NASCAR really market products that they cannot use or have no practical experience in? Revlon may not fit the model of the typical NASCAR product, but one can only imagine a potential tie-in or sponsorship with Danica. This partnership would provide a true women’s only product that the women who already attend the track could get behind, but this would only work if Danica comes to NASCAR and becomes a true contender; otherwise she runs the risk of being the Anna Kournikova of motorsports.
And that’s the view from here.
Just before race weekend in Richmond, Nate Ryan (USA Today) and Dustin Long (Virginian-Pilot) spoke to our Business of NASCAR class. One of the topics was whether Danica might make a switch to NASCAR from Indy Racing. Both Nate and Dustin indicated that all signs point to such a switch–but at a much slower pace than other open-wheel drivers. One scenario has Danica driving a few races (Camping World and/or Nationwide) before the Indy season begins and a few after the season ends. One of the problems with that scenario is finding a sponsor willing to put up bucks for such an approach.
Now it’s announced that Mark Martin has extended his contract with Hendrick Motorsport through 2011, with GoDaddy.com as a sponsor for 20 races each season. Is it a coincidence that GoDaddy.com is also Danica’s sponsor? Is this a prelude to Danica dabbling in NASCAR for a few races each of the next two seasons before moving over full-time (with Hendrick after Martin’s departure)? Let’s wait to see how this plays out at this season’s end but I have even money that this scenario is not out of the question.