Alex Meshkin

It is not possible to predict the road NASCAR will travel by the time we reach the final 2019 checkered flag, but it will be entertaining to speculate.

This decade begins as NASCAR tail spins in the wrong direction it’s a sharp contrast to the beginning of the last decade when NASCAR viewership, attendance and corporate interest were all surging. Today, all of those trends are in reverse, and this decade will truly define whether NASCAR remains as a mainstream sport or becomes another fledgling motorsport series.

I believe the major stories and events that will affect NASCAR in the coming years will have little or nothing to do with on track racing. So let me begin with a few predictions before we take our first green flag of 2010.

Two brands and two industries synonymous with NASCAR – Coors Light (Coors Brewing) and Texaco Havoline (Chevron) have in subsequent years cut ties with Chip Ganassi Racing and ultimately vacated NASCAR team sponsorship. The association and sponsorship of these two industries – Beer and Gasoline/Oil companies with NASCAR have by far the greatest value proposition; and yet they are leaving NASCAR? What is going on here? Even for someone like me who has been writing about the difficult NASCAR sponsorship market is surprised and concerned with Texaco pulling the plug on its storied NASCAR sponsorship program.

What is the root cause of these two prominent and long-term sponsors leaving NASCAR? The answer is simple: there are too many compelling alternatives which have a greater ROI and offer far less risk. Let’s be honest, primary sponsors are asked to commit up to $25 Million to purchase “so called advertising” without any meaningful guaranties of consumer advertising impressions. Sounds rather ominous, right?

Of course, sponsoring Dale Earnhardt Jr. and any of the other top performing drivers offers a unique value proposition: residue value through their brand loyal fans, merchandise and alike. But the vast majority of sponsors are receiving a diminishing ROI by virtue of the rising costs of NASCAR sponsorship and decreased television viewership and race attendance. Since 2004, the cost of becoming a primary sponsor of a top performing Sprint Cup team has soared by over 60% while television ratings have dropped by about 10%. The dichotomy of rising sponsorship costs and decreased television exposure is a disturbing trend which is primarily affecting the worst performing teams but could soon start to challenge the most elite NASCAR teams. The change in corporate sponsors’ attitudes towards NASCAR sponsorship shouldn’t surprise anyone.

However, NASCAR and its Teams have either refused or do not understand how to evolve in the digital age where advertisers can purchase measureable and interactive advertising with far less risk and much greater ROI. Unlike, most “traditional” businesses that reinvent themselves and innovate; NASCAR has failed to bring forth any meaningful innovations that can directly increase sponsors’ exposure and ROI.

Chip Ganassi Racing has had and continues to be one of the best performing open-wheel racing teams; and clearly delivers on and off the track performance for Target in the IndyCar Series. But unfortunately, Chip Ganassi’s foray into NASCAR has been a bitter disappointment. In 2006, Chip Ganassi secured Juan Pablo Montoya to pilot the #42 Texaco Dodge in the Sprint Cup series and hoped the media attention of the former IndyCar and Indy 500 Champion would ignite the performance and success of his NASCAR team. But excluding a few promising races (mostly on road courses) Montoya’s NASCAR career has underperformed. It appears Chip Ganassi Racing may be another victim of the sponsorship race; and soon join NASCAR’s elite defunct team list.

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.

The U.S. Navy will not return next year as sponsor of the No. 88 JR Motorsports Chevrolet owned by Dale Earnhardt Jr. and driven by Brad Keselowski.

“We were informed last week that our sponsorship with the U.S. Navy will not renew at the end of the year,” said Mike Davis, director of communications for JR Motorsports. “It has been an exceptional partnership since 2005, and we look forward to a strong finish to the season.”

Brad Keselowski is currently second in the Nationwide Series champion standings and won at Nashville earlier this year. This announcement is another huge blow to the fledging Nationwide Series, which has also seen icons like Richard Childress Racing (RCR) – unable to retain their Nationwide Series sponsors. NASCAR continues to face tremendous obstacles – and yet, nothing is being done to help support the teams’ survival. Instead, NASCAR continues to implement “rules”, which are contrary to the best interests of the teams and the sport in general.
With growing financial uncertainty – NASCAR and teams should also fear – that the automotive manufacturers may begin pulling their financial support from the Nationwide series – this again, is another example of NASCAR putting their heads in the sand until reality comes knocking at the door.
One must believe – - if Dale Jr. is having a difficult time finding and retaining Nationwide sponsors -this series may face further set of debilitating setbacks.

NASCAR officials have notified team owners in the Nationwide Series that they will delay the introduction of the Car of Tomorrow (COT) in the Nationwide Series by at least one year. According to Ramsey Poston, Managing Director of Communications at NASCAR, the reason for the change is because “testing and development” is still needed before the car is approved for competition.
While that does sound very nice and tidy, the real reason is far more ominous – and the decision was based upon the economic impact on the independent teams in the Nationwide Series. The introduction of the COT would require teams to replace their entire fleet of race cars and it would be financially inconceivable and ultimately would devastate the Nationwide Series in 2009.
Back in May, I wrote an article Car of Tomorrow (COT) – Friend or Foe for the Nationwide Series; where I foretold of the impending disaster of the COT for the Nationwide Series and quoted Dale Earnhardt Jr. about his race team’s future plans and the viability of the Nationwide Series with the COT:

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.

An official announcement is expected from NASCAR in two weeks.

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.