Alex Meshkin

Everyone is aware that a severe sponsor recession is hitting the NASCAR industry. But many are blaming the broader economic crisis as opposed to examining the dreadful trends eroding the NASCAR value proposition. NASCAR is facing a steady drop in television viewership, race attendance and overall fan interest, and the costs to operate a Sprint Cup team has almost tripled since 2002. Today, the top three teams – Hendrick Motorsports, Joe Gibbs Racing, and Roush Fenway Racing— are seeking complete season sponsorships between $22 million to $25 million. With the going rate per race anywhere from $500,000 to $750,000 – is there ANYONE who believes there is a ROI for sponsors at these prices? I don’t believe so.

Another alarming business trend, is that now, most sponsors want single-year deals. These days, a six-race package for $3 million qualifies as a “big deal” in Sprint Cup circles. The marquee free agent among sponsors is Ask.com, which spent about $4 million on its team deal with Hall of Fame Racing for the 2009 season and likely won’t spend more than that on the next deal, if indeed, the search engine decides to stay in the sport. Big name sponsors Allstate, DeWalt, Jack Daniel’s and Jim Beam will leave after this year, choosing to save that money or spend it elsewhere.

And of course, we are all aware of the market forces pushing the automakers to reduce their financial exposure to NASCAR – so I will ask the same simple question I have been asking for two years.

Why isn’t NASCAR doing anything to help the teams to ensure the long term viability of the sport?

I think the answer is pretty simple – they don’t feel they need too. And instead, want to continue pocketing the vast majority of the sports’ lucrative television contracts. And why, you may ask, has NASCAR (France Family) been able to dominate teams? I believe it is because NASCAR teams haven’t united into an association or partnership demanding the right changes to the sport. Just look across the pond to Formula 1 – while they face their own unique challenges, they do have a much more fair and logical business model. The teams are part of an association (Formula One Teams Association – FOTA), that collectively negotiates on financial matters and the adoption of rules affecting competition in their sport.

Whereas, when you look at NASCAR, you have a dictatorship run by Brian France, who I believe most will agree has single handedly undone many of the incredible accomplishments of his late father and grandfather. But as a former NASCAR team owner, I know the teams feel powerless. But it the truth be known, NASCAR is nothing without the teams. Now is the time for the teams to stand up and make a stand – the team owners are the only hope to save NASCAR. Teams must unite on common principles:

• Increased competiveness: major changes are required to the Car of Tomorrow to ignite fan interest
• Reduced operating expenses: less personnel at the track and NASCAR needs to follow the lead of Formula 1 and require race engines to be used at more than one event
• Modern technology: embrace fuel injection and alternative fuels/energy sources to make NASCAR an R&D platform for the automakers.
• Greater Revenue Sharing: Demand an equal share of the television revenues split between NASCAR, Race Tracks and Teams.

These 4 basic principles could reduce annual corporate sponsorship prices from $20 million down to $10 million – a marketing budget that could be justified to corporate executives. Plus, these changes would reignite the automakers interest in investing in the sport and most importantly, bring back the on-track excitement that race fans expect.

If teams do not take a united stand, but rather chose instead to continue to run around in circles spinning their wheels – they are facing certain annihilation.

Rumors are running rampant that Danica Patrick is going to jump from IndyCar to NASCAR. Is this a negotiating tactic with Andretti Green Racing and Chip Ganassi Racing or is she seriously considering a move to stock car racing? One must wonder why the poster child of IndyCar Racing would take the risk and make a move to NASCAR, which undisputedly, is crumbling as I speak. I can image NASCAR dangling HUGE financial incentives and prepackage endorsements, but why take the risk?

On the flipside to NASCAR’s continued problems with retaining the support of the automakers, IndyCar Racing is poised for a significant rebound in sponsorship demand and automotive support in the coming years. There is widespread speculation that Volkswagen/Audi, and possibly Toyota, BMW and Mercedes-Benz may join the IndyCar series in 2012. This is the result of IndyCar’s long-term vision and planning to strategically position itself as a “green” marketing platform for the automakers. A few of years ago, a move to NASCAR may have been considered a “step up” – but one most wonder if that still holds true today. Two of the most prolific IndyCar racers in this past decade struggled (and I am being kind) in their attempt to cross over to NASCAR. Dario Franchitti, the 2007 Indy 500 and IndyCar Champion failed miserably in his 2008 NASCAR foray and Sam Hornish continues to struggle. I don’t mean to be disrespectful to Danica – but she couldn’t remotely keep pace with Sam Hornish or Dario Franchitti in IndyCar, so I don’t expect her to be any more successful than Dario or Sam in NASCAR (Note: Dario and Danica were teammates 2006-2007). The odds are clearly against her if she makes the move.

My sources indicate that NASCAR, led by Brian France is offering significant guarantees to lure Danica to NASCAR. So if her primary motivation is money – we should expect her to make a debut later this year in preparation for the 2010 NASCAR season. A more intriguing question remains – why is NASCAR focused on attracting one driver, when the entire sport, (namely race teams), are facing financial annihilation? This not only is short sighted, but outrageously blind to the real problems facing the sport.

Many believe Danica is NASCAR’s bandage to stop hemorrhaging sponsors, fans and other commercial interest. I remain skeptical. While I agree she would drive a short term bump in ratings- the fundamentals of NASCAR racing is spiraling out of control – and no amount of estrogen is going to stop the bleeding. NASCAR needs to focus on fixing the business model challenges for teams and improving the COT – so the on-track racing can return to what fans deserve and expect.

Treating NASCAR like an amusement park and adding a new “attraction” may seem like a good idea – but in the end, it will only disguise the fundamental challenges that may devastate the sport that many still love. And Danica, well, she may be just another bump in the road for NASCAR – and at the end of the day, regret her move in the wrong lane.

Most will agree that the current economic recession will have a significant financial impact on NASCAR teams and the sport as a whole – but does it really need to be this way? In 2009, there will be significantly less Sprint Cup teams competing on a weekly basis – and yet, in economic downturns other sports such as the NFL or NBA do not have reductions in teams. Why is this so?  The answer is rather simple – other sports operate as a democracy with all teams participating in the economic benefits of the television contracts; while NASCAR on the other hand, is structured much closer to a dictatorship – with the profits being retained by NASCAR Corporate which is owned solely by the France Family.
Let’s examine the recent history and evolution of NASCAR: during the global economic expansion following the tragic events of 2001 – 9/11 & the death of Dale Earnhardt Sr., NASCAR experienced unprecedented interest from corporate sponsors; and growth was fueled by new television contracts with Fox and NBC. Because of NASCAR’s unique business model, which is vastly different than other sports, the industry flourished from 2003 until recently, gathering new teams, with investors and manufacturers flocking to the industry.
As a point of reference, NASCAR is the ONLY major US sport without a franchise model including profit sharing agreements. NASCAR Teams operate in a free market where teams must survive without much financial assistance from NASCAR Corporate; and where new teams can easily compete if they have the financial backing. I was a personal beneficiary of this policy – and at 23 years of age secured an agreement to led Toyota Motorsports into the NASCAR Craftsman Truck Series and went on to build  their competitive platform for their NASCAR operation.
I am very fortunate to have realized my lifelong dream of owning and operating a top tier NASCAR team; and even more rewarding to have brought Toyota Motor Sales their first two NASCAR victories. However, this so-called free market is a complete farce! The teams must secure over 90% of their operating budgets from corporate sponsors – a/k/a advertisers. What is more infuriating, and what is not common knowledge, is that NASCAR and its sister company ISC retain the vast majority of the sport’s healthy television contract revenues, and even compete against the teams  for corporate sponsors -  the  lifeblood of the race teams.  As many know, AT&T was forced to leave Richard Childress Racing (RCR) as a primary sponsor because NASCAR Corporate signed an agreement with Nextel (now Sprint) with an exclusivity provision precluding other wireless and telecommunication companies from sponsoring any racing team. So with teams on the verge of a depression – and with automotive manufactures and corporate sponsors reducing their involvement – NASCAR is busy lining their pockets at the expense of the teams.
The most fundamental precept is that without teams – there is no NASCAR; but somehow teams have failed to act on this most basic concept to leverage their position within the sport. Maybe in the past the very wealthy owners such as Rick Hendrick, Jack Roush and Roger Penske were complacent and satisfied with receiving a nominal share in the television revenues; but in today’s economic climate and the ultra competitive advertising marketplace – teams who want to keep standing on their feet, need to act now and demand a fairer share in revenues – not for personal profit; but simply to survive.
The management of NASCAR has a real opportunity to bring forth a “rescue plan” to save teams from closing their doors and fracturing the appeal of NASCAR; which could have irreversible effects on future television contracts and ultimately the profits of the France Family. The beauty of the NASCAR “dictatorship” is that they don’t need to hold a vote or seek the opinions of others; instead, they can just swiftly act to provide an increase in the teams’ alterative revenues, which would enable teams to offer sponsors a lower cost of entry to advertise in NASCAR.
You can’t expect any company to spend $20M to sponsor a NASCAR Team – the ROI isn’t remotely competitive. NASCAR needs to think long term and be willing to sacrifice some of their short term earnings for long term stability and growth in the NASCAR economy.

In my posting NASCAR Sponsorship 2.0, I previously discussed how teams have a real opportunity to leverage their “content” through digital channels creating supplemental advertising revenue to offset their losses in traditional on-the-car sponsorship. Some may ask, is there really an opportunity in digital advertising for NASCAR teams? A recent report from eMarketer, projects online advertising for sports sites will double from 2008 to 2012 – to $2 billion.

The sports site online advertising market is mostly untapped by NASCAR and remains a huge opportunity for race teams to tap into and ensure their continued viability in these difficult economic times.
While the most dedicated NASCAR fans are not your typical early adopters of online services; there still remains a tremendous opportunity to harness the power of the loyal demographic who embraces the internet as a regular source of news and entertainment. According to Quantcast, NASCAR.com generates approximately 3.7 M monthly unique users and peaks at over 6.5 M during the beginning of the season. So while the audience may be limited in numbers, the unmatched advertiser loyalty provides a desirable market opportunity to distribute content directly to fans through digital channels for racing teams such as Hendrick Motorsports, Roush Fenway and Joe Gibbs Racing. Unlike the franchised sports teams of the NFL, NBA, NHL and MLB; NASCAR Teams have complete autonomy of their online presence and content. This provides a significant value proposition where teams can leverage their content through a variety of online business models to create interaction with fans and ultimately new sources of advertising revenue. This would likely result in considerable exposure for their existing sponsors; and consequently create a new advertising inventory that would be measurable and provide a clear Return on Investment (ROI).
As a former NASCAR Team Owner, Sports Marketer and Digital Media Entrepreneur; I have succeeded in bringing new sponsors such as eBay and Toyota into NASCAR, and leveraged online advertising to unlock revenue sources from digital channels that created a history making NASCAR racing team. The potential has never been greater and the most successful teams have the largest market opportunity to generate significant value that can be monetized in the digital economy.

Over the past few years corporate marketing and advertising budgets have made a dramatic shift from Old Media towards New Media, which provides measurable customer acquisition with a recognizable ROI. Today, current NASCAR Sponsorship programs are structured much like Old Media, which fails to present corporate marketers with the value presented through “new media” channels. Now there are some who will say – sports marketing isn’t Old Media or New Media but Sports Media. While Sports Media does present a unique value proposition – at the end of the day, it does not provide corporate marketers a measurable customer acquisition medium -making it very similar to Old Media.
When specifically analyzing NASCAR as a marketing platform it’s undisputed that it provides unparallel consumer brand loyalty for sponsors; however “die-hard” fans, which are the most brand loyal – are unfortunately also a dying breed. As our country continues to face high inflation and a challenging economy for the middle-class, which is the loyal mainstay of the NASCAR demographic; it will become a less attractive marketing medium to corporate marketers.
Across the country, many businesses are attempting to adapt to this challenging economic market. Over the past number of months, the newspaper industry has announced wide scale layoffs as they attempt to transition their business to more online operations. The latest causality is The Atlanta Journal-Constitution that announced cuts to its work force by approximately 8 percent or 189 jobs. NASCAR is not alone; and needs to take heed and understand that it is no different than t the challenged models of the newspaper and Old Media industries – which also offer a branding and awareness platform with no real method to measure customer acquisition for its advertisers. Old Media is in a state of peril; and NASCAR and its teams must not make the fatal mistake of assuming they are immune to the fragile economy. Now is the time for them to reinvent themselves or they will face a similar dreadful business fate for their sponsorship prospects.
As a lifelong fan, former team owner and new media entrepreneur – I see numerous avenues to upgrade NASCAR from its current “1.0” platform to a “2.0” marketing approach; and leverage digital media technologies and social marketing techniques to provide unparallel fan interaction and advertiser ROI.
Back in 2003, in conjunction with the launch of my team Bang Racing with Toyota Motorsports, I developed a marketing platform and corresponding online venture to engage consumers and enable advertisers to target fans with online promotions and incentives. We successfully deployed a “points” based auction powered by eBay (a Bang Racing sponsor) and delivered unmatched ROI to our sponsors.
Today there exists technologies, which if employed could provide NASCAR and teams with a solution. Available web 2.0 architecture and social marketing techniques would enable NASCAR, teams and sponsors to leverage existing technology and increase their exposure, interaction and ultimately the sponsors’ ROI.
The most basic web 2.0 technologies, which have transformed online marketing, journalism and even politics, are “blogs”. They are free and easy to use but yet, not a single driver, team or even NASCAR has implemented one. This most basic concept is far beyond the understanding of most NASCAR insiders and demonstrates the antiquated approach to marketing.
NASCAR racing is entertainment and content; and while NASCAR Corporate controls the “content” at the racetrack; and teams are unable to successfully monetize their at-track presence – racing teams do have the ability to monetize their “content” away from the track – if they employ these new technologies. “RaceWorld”, which was a failed attempt by Michael Waltrip to engage fans in a physical structure, further demonstrates a lack of current business and technology savvy of NASCAR teams. Today, teams must embrace and engage fans through technology and the internet rather than expensive and traditional channels. A great case study is the success of online video – which is dominated by user-generated content – not by television networks or studios – this is the genius of the success of YouTube.
NASCAR teams, such as Hendrick Motorsports, Roush Fenway Racing and Joe Gibbs Racing could offset the devastating effects of projected manufacturer financial support losses and a difficult sponsorship market by simply distributing content through a variety of successful online businesses, which would increase advertisers’/sponsor’ impressions; while providing new revenue sources.
Through the use of live online streaming, micro-blogging, social networking and other web 2.0 concepts – NASCAR Corporate, racing teams and motorsports sponsors have the ability to receive an ROI capable of sustaining the growing costs of the sport. What are they waiting for – the race is on – and time is running out!

Shortly after the official announcement from Tony Stewart about his plans to race under the rebranded Stewart Haas Racing (formerly, HAAS CNC Racing) for 2009 and beyond – I posted a poll question asking my readers about their predication for Tony Stewart’s success in 2009.

Personally, I am shocked by the overwhelming predication of more than 5 wins for Stewart. While I personally agree with my readers, that Tony Stewart will find more success next year than this – 5+ victories would be a tremendous achievement.
The most intriguing aspect to the Stewart announcement is the further strengthening of the Hendrick Motorsports umbrella. Under the support of Hendrick Motorsports, Stewart Haas Racing will field at least 2 competitive Sprint Cup teams and JR Motorsports will continue in the Nationwide Series. In 2009, Chevrolet will support 10 NASCAR Sprint Cup championship contending race teams: 4 with Hendrick Motorsports, 2 with Stewart Haas Racing, and 4 with Richard Childress Racing (RCR).
The Stewart announcement provides Chevrolet and GM Racing a major conquest in the pursuit to fend off the aggressive maneuvers of Toyota Motorsports and Toyota Racing Development (TRD). As a former business partner of TRD and the Lee White led organization, I look forward to the strategic plans and business maneuvers of Toyota Motorsports in the quest for NASCAR dominance.

Richard Childress Racing (RCR) has much to be proud of these days and is tearing up the NASCAR Sprint Cup Series with having all 3 of his cars in the Top 12 in point’s standings; and is currently qualified for the Chase for the Cup. However, the off-the track business maneuvers of this champion contending organization is even more impressive. Yesterday, Caterpillar a long time sponsor of Bill Davis Racing (BDR) announced they signed a multi-year agreement with RCR to become the primary sponsor of Jeff Burton and the #31 team – replacing AT&T who is prevented from returning to the sport by NASCAR and Sprint. This announcement comes on the heels of RCR securing General Mills as the primary sponsor of their 4th team.
It’s ironic – the same rules that help you one season can come back to bite you the next. Case in point, the guaranteed starting position, which is afforded to the teams in the Top 35 in points, has been one of the motivating factors for the switch by Caterpillar to RCR(RCR #31 team is 2nd in the point’s standings). If you recall – this unfortunate rule was instituted by NASCAR only after the BDR Caterpillar team failed to qualify for a race in 2004 under the old rules. Regardless, you must congratulate RCR on their off-track success as they strengthen their organization to be better positioned to effectively compete with the super teams of Hendrick Motorsports and Joe Gibbs Racing.
Since 2002, the last year BDR won a race, they have rapidly unraveled and are clearly on the road of becoming defunct. In 2008 we see RCR redefining success with having 3 teams in the top 12; while two other organizations are teetering on the verge of extinction.

(full disclosure: In 2005, my team (Bang! Racing) was adding a Sprint Cup team and the Top 35 rule resulted in the loss of these new sponsors)

Dale Jr. had a victorious day in the LifeLock 400 at Michigan International Speedway – and ended an endless streak of 76 races. A win could not have come on a better day – Father’s Day. Earnhardt’s much anticipated first win of 2008 was achieved through a brilliant combination of strategy from cousin and crew chief Tony Eury Jr. and smooth driving by Jr. Ironically, Dale Jr. entered today’s race with a winless streak matching his father’s career number of victories – 76. There are numerous ironies. And yet, one can only imagine the thoughts Dale Jr. must have had as he made his way across the finish line– was Dad once again sitting beside him. I am sure there are two happy Dale Earnhardt’s today.

Congratulations to Dale Earnhardt Jr., the Earnhardt Family and Hendrick Motorsports.

Earlier this week, Dale Earnhardt Jr. provided a candid team owner’s perspective of the forthcoming change to the Car of Tomorrow (COT) in the NASCAR Nationwide Series. When asked about his future Sprint Cup plans with JR Motorsports, he said:

“I used to say no way, no way. But it’s almost as expensive to run in the Nationwide Series. And they’re going to bring a COT in and we won’t be able to race in the Nationwide Series with the COT probably. That’ll just be too expensive to switch all that over.”

“…And the COT program is going to be too expensive for me to justify creating a whole new program with COT stuff, so I’d just as soon go into the Cup Series or get out of the Nationwide Series altogether.”

Dale Jr.’s statements raise an alarming concern on the viability of the Nationwide Series. Let’s be honest – if the Nationwide Series business model doesn’t work for JR/Hendrick Motorsports – why then, would anyone think it would work for someone else? I have a hard time envisioning any other team being able to justify the capital expenditure required to compete in the NASCAR Nationwide Series with the COT. The pending arrival of the COT to the Nationwide Series couldn’t be at a worst economic time. Even teams such as Richard Childress Racing (RCR) are struggling to find new sponsors; and in retrospect, recently announced that the former Championship #21 team would be reducing its schedule in 2008 for the Nationwide Series due to a lack of sponsorship.

It’s undisputed that the COT provides enhanced safety for the drivers – which are undeniably priceless. However, compensation for improved safety should be at the forefront of NASCAR’s economic model and NASCAR should provide assistance for the teams’ through financial allowances to ensure that drivers and crew members are safe; while at the same time, enabling team owners’ to survive. It’s unfortunate that team owners must bear 100% of the financial burden of safety while NASCAR corporate continues to retain the vast majority of revenues and profits – continuing to drain many of the teams’ livelihoods – and perhaps even to the sport’s future longevity.

If I was still an owner of my NASCAR team (Bang! Racing), I would organize the Nationwide Series Team Owners to take a stand and demand financial assistance from NASCAR to adopt the COT in 2009. If Dale Jr. can’t afford to- who in the world can?

Last year, undoubtedly was the most dramatic year for racing fans in NASCAR Silly Season history with Dale Jr. moving from Dale Earnhardt Inc. (DEI) to Hendrick Motorsports. But this year may prove to be the most crucial for team owners, as sponsors and drivers play musical chairs as they navigate through the myriad of sponsor changes. With the enhanced expectations of corporate sponsors, drivers must be careful to choose the right team for 2009 and the future. Just look at DEI, Michael Waltrip Racing, Chip Ganassi Racing, Hass CNC Racing, Richard Petty Enterprises and Yates Racing – all are in dire need of sponsorship. And yet, you must give credit where credit is due – Travis Kvapil (my former driver at Bang! Racing) is doing an exceptional job for Yates Racing – but honestly, I don’t believe that sponsors are lined up at Yates door.

Every year, there is always one driver who defines all of Silly Season and in 2008 – that man is Tony Stewart. But to be realistic – you must believe that most, if not all sponsors considering a change (or any potential new sponsors – are there any?) will wait until Stewart makes up his mind before finalizing their 2009 plans.

It is well known that Stewart wants back into the Chevy camp where he has won two NASCAR Sprint Cup Championships and over 30 races. So that leaves Stewart with only two legitimate options – Hendrick Motorsports or Richard Childress Racing (RCR). Yes, RCR has won more races than Hendrick in 2008 but I would be shocked to see Stewart join RCR and race the Cheerios car. But on the other hand, Hendrick already has four drivers – didn’t they say they had “no room at the inn” last year before signing Dale Jr.? Could Casey Mears be moved to a satellite team like Hass CNC? Let’s just imagine – Dale Jr., Jeff Gordon, Jimmie Johnson and Tony Stewart all as teammates?

Only time will tell where Tony Stewart lands in 2009 – but the drivers better be ready to grab a seat because once Stewart decides on his plans – it will be pretty easy to be left without a seat once the music stops in the high stakes game of NASCAR Silly Season 2008.

Recently, Richard Childress Racing (RCR) made a major announcement – General Mills (NYSE: GIS) has agreed to a multi-year partnership to sponsor the No. 33 Cheerios®/Hamburger Helper® Chevrolet Impala SS beginning with the 2009 NASCAR Cup Series season.

This is the final nail in the coffin for NASCAR’s oldest team – Petty Enterprises. With its dismal performance in the past two decades, NASCAR’s old boys’ network continues to crumble. The trend of corporate sponsors to gravitate to the elite stables of Hendrick Motorsports, Joe Gibbs Racing, Roush Fenway Racing, Richard Childress Racing and Gillette Evernham Motorsports continues to challenge the sustainability of the remaining fledgling racing teams.

The days of former drivers and crew chiefs operating inefficient poor performing racing teams and shaving millions of dollars from major corporate sponsors are clearly over. The future of NASCAR is clear – there will be six to eight teams, each with four cars. The most elite will thrive; the others will fight for survival and the appeal of NASCAR with its core fans will continue to deteriorate.

Sincere congratulations to Richard Childress Racing and General Mills and best of luck in 2009.

10 years ago, if I told a NASCAR fan that Robert Yates Racing would lose all of their sponsors and be on the verge of going out of business and becoming another “defunct” team, every single fan would have said “you must be out of your mind.”

But fast forward to 2008 and so called “super teams” – Yates Racing, Chip Ganassi Racing, Bill Davis Racing and Dale Earnhardt Inc. all have primary sponsor vacancies and may shutter one or more of their teams. Some may ask “How did this happen?” You will hear many say the principle cause is the rising costs of drivers, personnel and other expenses. And YES, while these are all contributing factors; the fundamental flaw of a NASCAR sponsorship program is the inability to measure the performance and success of the program. While NASCAR has always positioned itself as a branding vehicle; in 2008 branding is only achieved through customer acquisition; and NASCAR sponsorship does not provide an effective means to measure its performance.

With the rapid growth of online advertising opportunities and pay-for-performance models, why would one invest a large portion of their marketing budget into a non-quantifiable advertising campaign? If motorsports’ agencies and teams cannot provide an answer to this daunting question – NASCAR fans will be more disappointed as more and more teams become sponsorless and face the inevitable loss of their favorite teams.    

When a potential corporate sponsor investigates a NASCAR sponsorship opportunity, the chief value proposition that is touted – is the high brand loyalty that sponsors’ receive. This approach is not only out-dated but the  value proposition is severely overrated.  As many know, I grew up as a die-hard Dale Earnhardt Sr. fan and subsequently, in recent years have cheered for Dale Jr. But do I drink AMP, Mountain Dew or any other Pepsi product? Ah No. Do I drive a Chevrolet? No. Clearly, brand loyalty is not enough to justify $20 Million dollars to sponsor a Sprint Cup team.

NASCAR teams, unlike Formula 1, completely rely on advertising revenue to fund their operations – and the option of reducing operating expenses is just not realistic. Consequently, unless NASCAR decides to “share the wealth” and allocate a larger percentage of television revenue to their racing teams, those teams MUST reinvent their marketing approach to survive.  But it’s not doomsday for everyone in the sport – Hendrick Motorsports, Joe Gibbs Racing and Roush Fenway Racing are on top of the racing world – with world-class drivers and premiere equipment – to drive their considerable sponsorship demand. But where does that leave, lesser know drivers and less significant teams, and perhaps even future teams?

As the youngest NASCAR team owner in history and with the best track record for any first year team, I scored Toyota’s first two NASCAR victories and know what it takes to perform on the race track and in the corporate board room. I personally pioneered the development of online loyalty and incentive programs in NASCAR and leveraged internet marketing strategies to secure companies such as, eBay to sponsor Bang! Racing. But without an integrated approach whereby teams can leverage the NASCAR brand, innovative business models will not prosper and teams will continue to fail at an alarming pace.

I implore NASCAR, its team owners and motorsports agencies to collaborate to develop and implement a better approach and solution before the majority of teams become bankrupt and are forced to be remembered as simply “defunct.”

By: Alex Meshkin, former owner of Bang Racing

By Dick Brinster, The Associated Press June 10, 2004
3:53 PM EDT (1953 GMT)

Dressed in a T-shirt, jeans and sneakers, his cap on backward, Alex Meshkin bears little resemblance to other NASCAR team owners.

That’s what Larry McReynolds thought when the former crew chief was approached last spring by Meshkin and asked to join Bang Racing, now a fledgling team in the Craftsman Truck series.

“I asked him, ‘Where’s your dad at? Your dad must be the one who’s going to do this deal,”‘ McReynolds recalled.

Little did he know this was a 23-year-old whiz kid who six years earlier took some money his parents put aside for college and made a few million sitting at his computer trading stocks.

“I was able to (turn) it into a little bit of wealth and start my own company,” said Meshkin, whose Bang Technology Software affiliate is based in Bombay, India.

He also heads a merchandising company and Nutzz.com, which rewards consumers for the use of products in a manner similar to retailers giving frequent flyer miles.

The two-truck team is costing Meshkin nearly $15 million a year, and he expects the operation to be profitable by 2007. That’s the fast lane in a sport where sponsorship can be tough to maintain.

But super salesman Meshkin isn’t concerned. His teams, with series champion Travis Kvapil and former Cup driver and Craftsman champion Mike Skinner, are backed by Toyota and eBay among others.

Meshkin laughs when asked about his attempt to become a racer.

“I always wanted to be involved in racing since I was a little kid,” said Meshkin, who briefly campaigned a formula car. “I prefer the ownership side. I think I’ll just stick with what I do well.”

To McReynolds, who owns a small share of the team, Meshkin stands out because of his “passion” for the sport.

“Every other business I’ve been involved in, the excitement to me was when I could sell it to make money,” Meshkin said. “For this, I don’t care how much they offer me, I wouldn’t sell it.”

In fact, he plans to expand to the Busch series and eventually to Nextel Cup. The truck teams are just the foundation of his racing program.

Meshkin knew he wouldn’t have much credibility without bringing aboard a high-profile racing figure. So he targeted McReynolds, and was persistent when first rebuffed.

“I wasn’t really interested in talking to him,” said McReynolds, Dale Earnhardt’s former crew chief and a TV racing analyst. “Since I stepped off the pit box at the end of 2000, I’ve had 30 or 40 people come at me.

“I always had the feeling that they were looking for someone with a magic wand in their back pocket to wave over the race team and try to fix it.

“Even though I won 23 Cup races as a crew chief, I lost 447. So, obviously, I don’t have a magic wand.”

Finally, Meshkin sold McReynolds on the team and then sold him a piece of it.

“He’s an awfully good salesman,” McReynolds said. “And he knows how to go out and get those sponsors.”

With McReynolds as vice president of racing, Meshkin is able to concentrate almost solely on the business side of the operation. Part of that is pairing sponsors and trucks.

Skinner’s effort is backed by Toyota and Kvapil’s chief sponsor is Line-X, a spray-on bedliner for pickup trucks. Meshkin secured them and is confident his acumen as a salesman will eventually allow Bang to field about a half-dozen teams spread through NASCAR’s top three divisions.

“Our goal is to be the best and the biggest,” Meshkin said. “We’re not modest here.”

Fruition of his plan would put Bang at the level of Hendrick Motorsports or Roush Racing, the biggest operations in the sport. Meshkin believes that’s attainable because he expects to hold sponsorship by giving backers a fair return on their investment.

“That’s why sponsors come into the sport and are gone in a few years,” he explained. “We need to keep them by doing what’s right for them and the race team.”

Meshkin, now 24, says being young hasn’t hurt him in his marketing. Actually, he’s always considered youth an asset.

“Even when I started my first company as an 18-year-old,” Meshkin said. “People would look at me and figure, ‘I want to hear what this kid has to say.”‘

http://www.nascar.com/2004/news/headlines/truck/06/10/amishkin_feature.ap/

By JEFF WOLF
REVIEW-JOURNAL

NASCAR Craftsman Truck series driver Travis Kvapil, left, and 24-year-old team owner Alex Meshkin have teamed to win two races this season. COURTESY PHOTO

The past year of racing for Travis Kvapil has been so unique it makes the spelling of his last name seem like Smith or Jones.

It started at the end of the past NASCAR Craftsman Truck Series season when he had to sit in his truck after the finale in Homestead, Fla., until race officials determined whether he or Ted Musgrave had won the season championship.

Although the ruling favored Kvapil, his reign started under clouds of uncertainty as owners of his truck team had decided to cut him from its 2004 lineup.

So the 28-year-old from Wisconsin hooked his championship wagon to a team owned by Alex Meshkin, a 24-year-old Internet entrepreneur who never had owned a race team before starting Bang Racing late last year.

Adding to Kvapil’s gamble: Meshkin’s team would rely on the new Toyota Tundra in the truck series. The Japan-based manufacturer had a proven history in other forms of racing, but this would be its first in one of NASCAR’s three major series.

It was a pair of long shots for Kvapil, but both gambles have paid off.

He will start Saturday night’s Las Vegas 350 truck series race as one of three drivers through 18 races who have won more than once this year. He has six top-five finishes.

With one year left on his contract with Meshkin, Kvapil has no regrets that he joined the youngest team owner in a major NASCAR racing series.

“I really believed in the program he was building, and I knew that Toyota would put good motors and trucks on the race track,” Kvapil said.

Kvapil and teammate Mike Skinner, the series’ first champion in 1995, are among four teams using Toyota equipment, but Kvapil is the only one who has won.

His second win was Saturday in Loudon, N.H.

“To get the second one makes a statement that this team is for real,” Kvapil said. “We’re contenders.”

Kvapil’s team is sixth in the standings with six races left and 188 points behind leader Bobby Hamilton. While Kvapil remains a contender for the season title, he also is looking toward next season when he and Meshkin move up to the NASCAR Busch Series.

“That’s the plan,” Kvapil said. “I wouldn’t say it’s 100 percent solid, but our sponsors are behind us to move up to Busch. (Meshkin is) working on some other sponsors, so we really have the money we need.”

Kvapil also denied rumors published last weekend that he was in line to replace Las Vegan Brendan Gaughan in the No. 77 Dodge for Penske/Jasper Racing in the Nextel Cup Series.

“It’s that time of year for rumors,” Kvapil said. “No one from Penske has talked to me.”

Meshkin, a native of Washington, D.C., said he expects to make an official announcement about his NASCAR plans in 45 to 60 days and it could include a second part-time team in the Busch series. He also said Kvapil will compete in some truck races next year to support one of the team’s sponsors that makes products geared to pick-up trucks.

“When we go Busch racing, it’s more competitive and you’re racing Cup teams,” Meshkin said. “It’s an opportunity to beat (teams like ) Hendrick, to beat RCR (Richard Childress Racing). That will give us the momentum when we go Cup racing.

“We won’t go racing in any series unless we’re going to be competitive.”

Meshkin’s first year in NASCAR has included a learning curve. A disagreement with Toyota over unspecified issues led the manufacturer to announce three weeks ago that it was pulling support from the team that would have forced Meshkin to find Fords, Dodges or Chevrolets for his drivers to finish the truck season.

A week later, however, Toyota backed off the threat, but Skinner left Meshkin’s team and began driving for Bill Davis Racing, another Toyota-backed program.

“When there’s stuff like that there’s always going to be distractions, but it was neat the guys in the shop never missed a beat,” Kvapil said.

Meshkin brings a new approach to NASCAR’s tradition-based world.

“I think we’re the most successful new team in NASCAR history,” he said.

“You can accomplish anything; it’s how you go about it. I think we’re more relaxed than other teams. By having a culture that has created unity, we are a more competitive team.”

http://www.reviewjournal.com/lvrj_home/2004/Sep-21-Tue-2004/sports/24812898.html