SBD/August 7, 2014/Marketing and Sponsorship

National Guard Pulling Sponsorship Of Earnhardt Jr. In NASCAR, Rahal In IndyCar

National Guard spent $32M in sponsorship dollars on Earnhardt's No. 88 in '14
The National Guard yesterday announced that it will "not return as a sponsor" for NASCAR Sprint Cup Series driver Dale Earnhardt Jr., but "when exactly that decision takes effect is unclear," according to Jeff Gluck of USA TODAY. National Guard in a statement on its website said that its current contracts to sponsor Earnhardt's No. 88 Hendrick Motorsports Chevy and the Verizon IndyCar Series car of Graham Rahal "expire at the end of this season." However, HMS in a statement said the team "has a contract in place to continue the National Guard program at its current level" in '15. National Guard said that it spent $32M as a sponsor for Earnhardt this season, which "includes appearing as the primary sponsor" for 20 races, and also spent $12M to sponsor Rahal. Gluck noted Congress has "scrutinized the arrangement of the Guard's spending in motorsports" (USATODAY.com, 8/6). SPORTING NEWS' Bob Pockrass wrote ironically, Earnhardt, who has had National Guard sponsorship since '08, is "enjoying his best season in 10 years." But the sponsorship "had appeared in jeopardy since that May hearing." The National Guard "cannot point directly to recruits as a result of the sponsorship," but according to a '13 internal study, 90% of those who "enlisted or re-enlisted since 2007 were exposed to the Guard through recruiting or retention materials featuring NASCAR cars and/or drivers." The study also found that NASCAR fans are 20% "more likely than non-fans to support a friend or family member who pursues military service" (SPORTINGNEWS.com, 8/6).

TOUGH BLOW FOR INDYCAR TEAM
: The National Guard in its statement said that motorsports is "not the only marketing arena to suffer under reduced budgets." The AP's Jenna Fryer noted Earnhardt "has won three races this year" when the National Guard was his primary sponsor. Meanwhile, Rahal "only landed the guard this season after a prolonged battle with Panther Racing, which had the sponsorship in IndyCar" from '08-13 (AP, 8/6). In Indianapolis, Curt Cavin writes the National Guard's exit from motorsports "was no surprise." That the sponsorship was "coming to an end in motor sports started about the time Congress started squawking about the budget." The IndyCar money is "less than half of the NASCAR money, but it's twice as important to the team involved." HMS can "leverage association with Earnhardt, the most popular driver in U.S. racing," while IndyCar's Rahal Letterman Lanigan Racing team has a driver "with one career win and television ratings that are only a few drops in NASCAR's bucket." From "this side of the sport, it's a significant blow" (INDIANAPOLIS STAR, 8/7).
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