Alex Meshkin

On Sunday Morning, Bruton Smith conducted an interview with ESPN. After questioned about the challenging times that is facing NASCAR; Smith reaffirmed his desire to acquire NASCAR and said, “And it’s getting closer”, referring to the possibility of the France Family looking to sell NASCAR. Is Smith just stirring the pot? Or perhaps, is the France Family finally considering ending their strangle-hold on the sport?
Hypothetically, let us assume Smith’s statements are backed by an element of fact and that the France Family is looking to sell NASCAR. It is my opinion that a change in ownership from the France Family to Smith would not bring about the change needed to put NASCAR back on the track for growth. As discussed in my most recent blog entry, The Failing NASCAR Economy: A Time for Action! - NASCAR must act to bring forth changes to support its lifeblood – the race teams. A Smith regime would only continue the same old policies of providing the race tracks a disproportionate share of the television revenues as compared to the racing teams. These policies need to change – NASCAR Sprint Cup Teams must receive a greater portion of the television revenues earned by the sport – because without Teams there is no NASCAR. Yes, tracks are valuable, but as Formula 1 has proven, track owners and promoters are willing to host events without large subsidies from the governing body.
The best avenue to save our sport and put it back on track, allowing it to grow into the next decade, is for an entrepreneurial executive; who understands the sport, new media and the market trends to lead a leveraged buyout – partially funded by a team franchise model – where 43 Sprint Cup Teams would receive a minority ownership and participate in profit sharing to ensure the stability of the premiere NASCAR series – the Sprint Cup.
The impending fluctuations expected in the number of competitors in the second most watched sport in country – the Sprint Cup Series, is completely unacceptable. A new ownership structure must include policies and an agreement to secure the future of the Sprint Cup Series by enabling Team Owners to purchase Franchises and receive votes in the future of the sport that they have all built. This new structure would eliminate the sanctioning body from competing with teams for sponsors and create a more healthy sport to ensure its long term future.
2008 has been the year of “change” – Americans want “change”, NASCAR Fans want “change”, NASCAR Teams want “change”. If the France Family provides the opportunity for “change” in the leadership of NASCAR – let us all hope that it is the “right change” that comes to Daytona Beach.

The first domino has fallen in the shakeup with the Big 3 automotive manufacturers’ involvement in NASCAR. The exit announcement by Dodge is the latest blow to the NASCAR Craftsman Truck Series which has yet to find a title sponsor to replace Craftsman in 2009 and beyond. In 2009, Dodge will not provide any financial support to any teams in the series. Dodge Motorsports senior manager Mike Delahanty said,

“We’ll have no factory-funded teams.”

Delahanty told ESPN.com,

“When times are tough, there are certain things that are lower on the priority list than others.”

This leaves us to ponder: Are the other series next? For years, rumors have circulated that Dodge would pull out of NASCAR- is it finally happening?

Earlier this decade Dodge was a powerhouse in the NASCAR Truck Series, winning 46 of 99 races from 2001-2004 and championships with drivers Bobby Hamilton in 2004 and Ted Musgrave in 2005. This year, Dodge scaled back its involvement and provided manufacturer support only to Bobby Hamilton Racing-Virginia. However, Dodge informed the team that its factory support would end this season. Delahanty said the manufacturer’s involvement with the Sprint Cup and Nationwide Series is unaffected.

Now you might ask: why hasn’t NASCAR attempted to “fix” the Truck Series value proposition to raise its “priority” with Dodge and the other manufacturers – the answer is part of the problem for NASCAR – with unprecedented sponsorship deflections in the Sprint Cup Series, the Truck Series is a low priority for NASCAR.

As the former owner of Bang Racing, Toyota’s first NASCAR Team to compete in the Truck Series and the leading competitor of Dodge Motorsports, it is a sad day for the entire NASCAR community. As I have predicted, it is only a matter of time before all of the Big 3 reduce their involvement in NASCAR. The writing is clearly on the wall – the inverse proposition of marketing costs versus benefits is an alarming trend and appears to be continually ignored by the NASCAR leadership.

Instead of squarely addressing the concerns of corporate sponsors and automotive manufacturers’ – NASCAR seeks new automotive partners to rejuvenate the floundering Truck Series. In 1999, Dodge Motorsports announced their plans to enter the Truck Series and, at the time, were widely credited with saving the series. In 2003 the Truck Series was still floundering andfloundering and the Big 3 began scaling back yet again, but Toyota Motorsports and Bang Racing soon entered the the Truck Series and delivered an unprecedented amount of media attention which fueled substantial increases in technical, financial and marketing spending from the Big 3 manufacturers in the Truck Series. But now times are tough; and with the uncertainty and questionable sustainability of the Truck Series, combined with plummeting light-truck sales; the odds of NASCAR finding new automotive manufacturer partners is rather slim. Sadly, it appears NASCAR will attempt to solely treat their symptoms and leave the underlying problems unresolved.

Has anyone noticed the decreased television advertising from Anheuser-Bush, Miller and Coors during NASCAR Sprint Cup race telecasts? Following the split of Dale Earnhardt Jr., Budweiser and Dale Earnhardt Inc.; Anheuser-Bush has apparently rapidly diminished their dominate presence over our weekly telecasts. In my opinion, this is the procuring cause to Miller and Coors’ also reducing their media placements during NASCAR broadcasts. While I don’t have the numbers to backup my observations, nonetheless, I think the anecdotal evidence is enough to question the “Dale Jr” effect on the return-on-investment (ROI) of the NASCAR television contract for Fox, NBC, TNT and ABC/ESPN.

So I question, is their enough of a demand to offset the loss of beer ads? If so, I certainly would be surprised if that demand will withstand the current economic pressure. But for sure, no one expected the self-interested actions of Teresa Earnhardt to have such a negative impact and affect so many other parts of the NASCAR food chain. It seems apparent that you can add the broadcasters to the list of people and companies that are keeping their distance from Teresa Earnhardt.

Earlier this week, ESPN expanded its motorsports digital content business through the acquisition of Racing-Live.com. Racing-Live.com covers Formula 1 (F1-Live.com), Moto GP; Superbike (Moto-Live.com), Rally (Rally-Live.com), off road Rallies (Raid-Live.com), Endurance Sports-Cars and Kart racing.

This announcement follows the acquisition of Jayski, a NASCAR gossip site in 2007. Racing-Live.com strengthens ESPN’s global business and provides a digital avenue to monetize Formula 1 racing through the site’s three million unique users per month.

I’m delighted that ESPN now offers sports fans world-class online coverage of football, rugby, cricket and motor racing, said Lynne Frank, Managing Director of ESPN, Europe, Middle East and Africa. Racing-Live.com is a leader in its category and has built a solid base from which to further develop our digital motor sports offering. We are particularly pleased that Racing-Live.com joins ESPN in the middle of another fantastic Formula 1 season.

It is going to be interesting to observe how ESPN integrates Racing-Live into its portfolio of digital media businesses; given Racing-Live isn’t the first digital media acquisition made by ESPN. Since the acquisition of Jayski in 2007, very little has changed and even its website has remained almost identical since its inception in 1996. The business model of Jayski is very different than traditional media sites and focuses primarily on unofficial team generated content – basically translated; employees’ of race teams share gossip, rumors, opinions and often lies about their employers and/or competitors. This model has created a very sticky site and thus was a procuring reason for ESPN acquiring Jayski.

Some may wonder if the Jayski model would be successful in Formula 1. I seriously doubt it and this is why: NASCAR is a unique culture with the rumor mill driven primarily by the close physical proximity of all the race teams. Speaking from personal experience; if I had lunch with a driver from another team – it would instantly be posted to Jayski …”hearing XYZ driver may be headed to Bang Racing.” While there is an element of truth to the “gossip”- it is usually twisted with an element of fiction.

Because the culture of NASCAR Sprint Cup is clearly trending more towards Formula 1 than vice-a-versa; and with the super teams becoming more self-sufficient and less reliant on vendors to support the sponsorship development process; it is likely that Jayski’s sources will be minimized at best and rumors and the like will become less prevalent.

With that said; don’t expect to see ESPN exporting the Jayski business model over the pond; but maybe expect to see Racing-Live expanding into mainstream American motorsports.

Place your bids
Bang Racing announced an agreement with online aution site eBay, which includes a co-primary sponsorship of the Bang Racing motorsports teams in the NASCAR Nextel Cup and an associate sponsorship in the NASCAR Craftsman Truck Series.

“We’re thrilled to have eBay become an associate sponsor in the NASCAR Craftsman Truck Series and support a young entrepreneurial team’s entrance into the Nextel Cup, NASCAR’s premier series,” said Alex Meshkin, CEO and principle owner of Bang Racing. “We hope other technology companies will follow eBay’s lead and join forces with Bang Racing to reach brand loyal NASCAR fans.”

EBay’s associate sponsorship of Bang Racing in the NASCAR Craftsman Truck Series includes the No. 42 Toyota Tundra with driver Mike Skinner, the 1995 series champion, and the No. 24 Tundra with driver Travis Kvapil, the 2003 champ. The agreement includes eBay’s sponsorship of Bang Racing in the Nextel Cup series during the second half of 2004 as the team prepares for its full-time entrance in the Nextel Cup Series in 2005.

“We’re proud to sponsor Bang Racing and be part of NASCAR series,” said Gary Dillabough, vice president, eBay strategic partnerships. “This sponsorship agreement provides eBay an opportunity to reach the passionate motorsports community and introduce Bang Racing to the eBay community, now totaling more than 95 million registered users.”

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