SBJ/Dec. 6-12, 2010/This Week's Issue

Penske sales flow to Shell-Pennzoil bottom line



AUTOSTOCK / BRIAN CZOBAT (2)


Kurt Busch (top) and Helio Castroneves sport
the Shell-Pennzoil colors on their circuits.

Editor's note: This story is revised from the print edition.

Shell-Pennzoil executives think the company’s sponsorship of Penske Racing has the potential to pay for itself based simply on the amount of fuel and oil it sells across the Penske system of more than 310 auto dealerships and 200,000 rental trucks.

The company last week unveiled a new paint scheme at Penske Ferrari in Las Vegas and disclosed details of the multidimensional, business-to-business relationship that led to its multiyear agreement to sponsor Penske’s No. 22 car.

The partnership makes Pennzoil-Shell the preferred oil and fuel provider for Penske’s truck leasing business and the preferred motor oil of Penske Automotive Group, which includes dealerships throughout the U.S., Germany and the United Kingdom.

The ancillary agreements are some of the most far-reaching that Penske Racing has ever cut with a partner. Penske’s previous agreement with Exxon Mobil around the No. 77 car driven by Sam Hornish Jr. made Mobil 1 the preferred lubricant supplier of Penske Automotive Group. The new deal with Pennzoil-Shell expands on that business-to-business opportunity by adding the truck leasing relationship.

“The B-to-B side is somewhat unprecedented in terms of the magnitude of the relationship,” said Heidi Massey-Bong, Shell’s senior business adviser for NASCAR. “I don’t think you can find [another partner or team] in the garage doing so much to bring money to the bottom line.”

Darren Marshall, senior vice president of research at sports marketing agency rEvolution, said the deal is one of the few team-level deals in NASCAR that offers an immediate return on investment.

“The nice thing about this deal is that it’s going to have a substantial impact on purchasing consumers will make, but by the same token there’s already going to be money in the bank from the Penske relationships,” said Marshall, who was hired by Shell to analyze the deal after it was cut. “It’s a hard number you can take and share with the COO. It’s not an impressions number. It’s actually, ‘Here’s the balance sheet.’”

Sport Dimensions, Shell’s longtime motorsports agency, will help it activate the partnership.

The deal also has the potential to help further Pennzoil’s relationships with auto manufacturers. Pennzoil is the factory-used product for five auto manufacturers, and it hopes that it can become the oil of choice for others by leveraging Roger Penske’s extensive dealership relationships with everyone from Audi to Porsche.

Shell-Pennzoil also has signed on as an associate sponsor supporting Penske’s IndyCar drivers Helio Castroneves, Will Power and Ryan Briscoe, as well as being the primary sponsor on Castroneves’ Indy 500 car.

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