SBJ/Feb. 7-13, 2011/Marketing and Sponsorship

American Ethanol plants its flag in NASCAR

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

When the green flag drops at the Daytona 500, American Ethanol will be there, literally, and it will be just about everywhere else fans look, as well.

The customized red-white-and-blue, lower-cased “e” logo of NASCAR’s newest partner will adorn not only the green flag at the start-finish line but also more than 120,000 green flags distributed to fans before the race. The flags will be one of the most visible components of American Ethanol’s yearlong plan to raise awareness and support for the ethanol industry among NASCAR fans.

At the end of last season, NASCAR announced a landmark, six-year agreement with Growth Energy, an ethanol lobby group, and the National Corn Growers Association. The deal is valued at more than $13 million and includes an array of assets ranging from a sanctioning body partnership and track support to driver support and a contingency award program.

Ethanol will make its NASCAR debut with cars running Sunoco Green E15 fuel at Daytona during the next two weeks. Most of American Ethanol’s promotion will be on conveying the values of E15 fuel, which it believes contributes to cleaner air, more jobs for farmers and more energy independence for the nation.

NASCAR’s decision to use E15 and American Ethanol’s promotion of it comes at a critical time for the ethanol industry. The Environmental Protection Agency recently approved a blend of E15 fuel for cars built since 2001, but the ethanol industry would like to see the EPA mandate it for all vehicles.

“Having a 15 percent blend of ethanol with Sunoco Green E15 is a great way to validate to tens of millions of Americans that E15 is a safe, good fuel for your car,” said Greg Breukelman, a board member of Growth Energy.

As part of its deal with NASCAR, American Ethanol’s logo will be featured on the green flag at every race and will encircle the fuel port of each car. American Ethanol is the first partner to be featured in both locations, and NASCAR amended its annual driver-owner agreement in order to pass the space around car fuel ports to American Ethanol. It did so because of American Ethanol’s support of the contingency program recognizing the driver with the fastest average speed on all restarts.

American Ethanol is supporting those components of the deal by signing former driver and TV analyst Rusty Wallace as a program spokesman. It also is in negotiations with a Sprint Cup driver who will promote its cause, and may support those efforts by partnering with a driver or team for a one-race primary sponsorship, Breukelman said.

The brand hasn’t signed any track deals, but it plans to activate at tracks in the Midwest with a mobile marketing effort focused on ethanol and the American farmer.

“It will be done in a way that will be very visible and impactful,” said David Grant, principal at Velocity Sports & Entertainment, which is handling American Ethanol’s sports marketing. “It will bring to life what not just American Ethanol is about but what the American farmer is about.”

American Ethanol also will be the presenting sponsor at the first of NASCAR’s Fuel for Business business-to-business meetings in 2011 and also the presenting sponsor of NASCAR’s first Green Summit, which hasn’t been scheduled yet.

American Ethanol doesn’t plan to buy any media time, but it will receive media exposure and promotion in an environmental campaign being developed by NASCAR. The sanctioning body plans to use some of its commercial inventory this year with networks to promote NASCAR Green — a new initiative built around what NASCAR calls the pillars of conservation, job creation and American energy security.

The spots will feature American farmers and NASCAR’s use of Sunoco Green E15 fuel.

“We’re going to show imagery of how the country comes together to have American ethanol in the fuel cell of a race car,” said Mike Lynch, NASCAR’s managing director, green innovation. “That’s an American communal effort to make that happen that creates jobs and helps conserve the environment.”

NASCAR’s push around ethanol comes at a time when viewpoints on the benefits of corn-based ethanol are shifting. Former Vice President Al Gore, a leading environmentalist, in November said that he made a mistake in supporting corn-based ethanol subsidies and said the energy-conversion ratios of corn-based ethanol was small at best.

The corn-based ethanol industry also has faced criticism for contributing to food scarcities — ethanol production last year reportedly consumed 41 percent of the U.S. corn crop — and contributing to the national debt — federal ethanol subsidies topped $7.7 billion in 2009.

Lynch said NASCAR was aware of those issues when it struck its long-term partnership with American Ethanol and felt the data supported the partnership, especially as the refinement process for corn-based ethanol evolves. He said that it was important to think that “commentary through.”

“We look to the EPA and the fact that corn ethanol has been classified as a renewable fuel,” Lynch said. “That’s based on tremendous research done over years, and we get that.”

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