SBJ/Feb. 17-23, 2014/In DepthPrint All
Six months into the $400 million rebuild of Daytona International Speedway, track President Joie Chitwood can hardly contain his excitement. Construction is ahead of schedule as the facility shifts to operations mode for its first racing events, including the Daytona 500.
“It’s amazing how much work we’ve done to date,” Chitwood said over the phone before boarding a flight to Chicago to announce Toyota as the first founding partner for the Daytona Rising redevelopment. “We have 60 million pounds of concrete in the ground and when it’s all said and done, there will be 40 million pounds of steel in the air, taller than certain areas of the grandstand. We’re planting a flag in Daytona and are going to make sure this is the only motorsports stadium in existence.”
Daytona International Speedway’s extreme makover is taking shape. The project is slated to wrap up by January 2016.
Photo by:Daytona International Speedway
International Speedway Corp. alone is in the early stages of a five-year, $600 million capital expenditure program covering its 13 facilities, including Daytona. Speedway Motorsports Inc., meanwhile, is investing millions this year to install a new video board at Texas Motor Speedway. It is the only substantial upgrade for SMI tracks in 2014 after the group spent $1.4 billion in improvements from 1995 to 2012, SMI spokesman Scott Cooper said.
Overall, both groups and NASCAR are pushing for these improvements to help resolve the issue of declining attendance at their facilities over the past several years and bring in new amenities their fans are accustomed to enjoying at major league arenas and stadiums. Combined ticket revenue at ISC and SMI, which play host to the majority of Sprint Cup races, has dropped by more than $175 million since 2007, or roughly 41 percent. At the same time, NASCAR is facing the same issue as other major league sports, competing against the home theater experience.
“We have to come back to getting folks off the couch,” Chitwood said. “There’s a lot of entertainment options out there, and as much as our television partners put on a great show … we have to make sure our events are compelling and make a lot of sense.”
Eddie Gossage, president of Texas Motor Speedway, agrees with Chitwood’s assessment. The track, which opened in 1997, no longer jams 200,000 race fans into its facility but still draws up to 140,000 for Sprint Cup events, a number covering the infield crowds, Gossage said.
“There’s been a shift demographically and I think culturally,” he said. “Television coverage has improved so much that people are more likely to stay at home and watch the event on TV. That’s one of the big reasons why we’re putting in [monster video board] ‘Big Hoss.’ You want to give the fan every reason to choose to come out to the event. We needed to step up our game considerably. Now, you’re not going to miss anything when you’re here … that little piece of debris on the track that you can’t see, so you think, ‘NASCAR threw a caution for no good reason?’ Now you can see it.”
For many facilities hosting NASCAR events, the starting point for improving the fan experience begins by reducing
Toyota has become the first of four founding partners for Daytona’s renovation. It will have naming rights to one of five entrances to the venue.
The extent to which it makes sense to downsize tracks is market-specific, said Jill Gregory, NASCAR’s vice president of industry services.
“You’ve got varying degrees of investment across all of our facilities,” Gregory said. “The seating configuration is part of that. Each track is looking at what their market wants and trying to figure out what the right mix is.”
Daytona was among the first tracks to announce that its capacity would shrink, by 40,000 seats after the track renovation is completed in January 2016. Last month, ISC announced seven more of its tracks would reduce capacity by a combined 94,000 seats. Driving the adjustments is ISC’s strategy to promote sellouts and create excess demand, according to the company’s public financial filings.
“The grandstand capacity changes are really part of a longer-term commitment to improve the at-track experience through better sight lines and greater access to the facilities’ amenities, including pre-race experiences,” ISC President John Saunders said.
Talladega shrinks to 78,000 seats this year, in large part because of the removal of the 18,000-seat Allison Grandstand on the backstretch. It’s being replaced by a combination of recreational vehicle spaces reserved for corporate sponsors and higher-end individual rigs, track Chairman Grant Lynch said.
The track at one time had 147,000 seats. Over the past five years, Talladega has replaced most of its seats along the frontstretch with bigger chairbacks and more leg room, effectively reducing the track’s total capacity, Lynch said.
Those who bought seats in the Allison Grandstand, which started off Turn 2 and stretched 4,000 feet halfway to the superstretch, are being relocated to a nicer seat in a better location along the frontstretch. The price stays basically the same, $50 for a two-day ticket.
“That was our entry-level ticket,” Lynch said. “Now, they’re on the side where all the drivers’ souvenir rigs are and where our tram systems operate more efficiently. It gets everybody on the front side where they should have a better experience.”
Both Richmond and Chicagoland Speedway are reducing capacity by 15,000 to 20,000 seats, in part by repurposing real estate as hospitality villages and other fan destinations.
In Richmond, officials removed the 10,000-seat Henrico Tower along the backstretch in favor of developing an open-air bar for fans to get out of their seats and take a breather during the race. Fan surveys indicated the old seats “weren’t getting high marks and there was a decent amount of dissatisfaction,” said Dennis Bickmeier, the speedway’s president. “They were climbing four stories to get to their seats and there were not a lot of amenities there. That made it difficult for those ticket holders and they were not renewing at a high rate.”
Those who did renew their tickets for the backstretch have been moved to the frontstretch where they now have a view of pit road, Bickmeier said.
The full concept for the revamped backstretch space has not been announced yet but it will tie in to a track tradition called the “Richmond Stroll,” where race fans can walk a full lap around the track just outside the facility and still be connected to the event.
“We want to use it to our advantage,” said Bickmeier, who sees similarities between Richmond and his days working for the Los Angeles Rams and Los Angeles Angels at Anaheim Stadium, which transitioned between football and baseball to provide the best possible sight lines. “Part of the stroll is to stop and enjoy a cold beverage.
We want to do something back there that honors the history and tells the story of Richmond. I’ve seen it done at Monument Park at Yankee Stadium. It’s a great branding opportunity as well. We’re talking to companies and agencies about it.”
Texas Motor Speedway, meanwhile, an SMI property, made the decision not to sell about 13,000 seats along the backstretch this year in large part because of the installation of Big Hoss, a gigantic Panasonic video board under construction in the center of the backstretch. Measuring 218 feet wide and 95 feet tall, Big Hoss ranks as the largest single video screen in sports, for the moment (see related story). The seats in question do not have a view of the board.
“Why spend millions upon millions of dollars to build this incredibly nice amenity and then sell a ticket to somebody to have their back to the board? Why not put everybody on the front straightaway?” Gossage said.
“We’re just going to leave [the backstretch seats] alone. There’s no reason to cover them with a tarp because then the media says, ‘Look, you’re hiding them.’ No, we’re creating revenue [with the monster board]. We’ve talked about taking them out, but what if demand changes? Then you have to put them back in.”
Talladega has replaced most of its seats along the frontstretch with bigger chairbacks.
Photo by:ISC Photography
The terrace has been tarped off for past Sprint Cup races, and SMI officials have considered removing the seating and pouring a concrete slab for motor homes in its place (SportsBusiness Journal, Nov. 25-Dec. 1, 2013). To date, SMI has not announced the future of those seats.
“Our focus is on maximizing the fan experience at all of our tracks, and in some cases that means lost seats,” said Marcus Smith, president of Charlotte Motor Speedway and SMI, its parent company. “Putting the biggest TV in the world at Texas Motor Speedway will result in a loss of some seats, but it’s a great trade-off.”
As a companywide policy, SMI Chairman Bruton Smith prefers not to tear down seats, according to Jerry Gappens, executive vice president and general manager of New Hampshire Motor Speedway.
“Bruton is a strong proponent of selling what you got, and so even though the economy has been challenging and not all the seats have been sold, what we’ve tried to do is adjust the pricing,” Gappens said. “An entry-level seat down in turns 3 and 4 when we bought the track in 2008 was $60. Today that ticket is $25. You try to create an entry point and affordability for all segments of your fan base.”
Back at Daytona, downsizing the speedway by eliminating backstretch seats and increasing the size of all new seats installed throughout the facility makes the most sense for improving the fan experience, Chitwood said. The track will seat about 100,000 when the project is completed, compared with 147,000 before construction started.
“I feel like we’re in a good position and I’m excited about what NASCAR is doing to improve the sport,” he said.
The two groups operating most NASCAR tracks differ in their philosophy for video boards.
Speedway Motorsports Inc. has drawn attention over the past four years for installing two of the “world’s largest televisions,” starting in 2011 at Charlotte Motor Speedway. In March, an even bigger board will debut at Texas Motor Speedway.
They are both immense, stretching a minimum of 200 feet wide. When it’s completed, Texas Motor Speedway’s board, called “Big Hoss” and made by Panasonic, will stand 12 stories tall and weigh 108 tons.
“Big Hoss” will tower over the backstretch at Texas Motor Speedway.
Photo by:Texas Motor Speedway
The price tag for Big Hoss runs in the “tens of millions of dollars,” Gossage said, which includes the control room situated above the start/finish line.
It’s a big expense for holding bragging rights in sports, and there’s a drawback that comes with it: Because of their location in the center of the backstretch, the monster boards in Charlotte and Fort Worth can’t be seen from thousands of seats built along the back side at those tracks. As a result, those 53,000 seats, 40,000 of them in Charlotte, have practically been rendered obsolete.
International Speedway Corp., owner of operator of 13 NASCAR facilities, recognized the issue and took what officials feel is a more practical approach.
Starting at Talladega Superspeedway this spring and spreading to other ISC tracks later this year and in 2015, ISC is testing the use of portable screens that can move from track to track. The program calls for bringing bigger and better boards to ISC venues and strategically placing them around the track so that all fans have a view.
ISC tracks are looking to build permanent frames and to rent higher-quality screens that can be hoisted into those structures, Talladega Chairman Grant Lynch said. It would be an upgrade over the old system, in which video screens are attached to tractor-trailers, Lynch said.
ISC will solicit fan feedback about the newer boards on their optimal size, location and content before installing permanent boards, said Lenny Santiago, spokesman for Daytona International Speedway and ISC. The cost to put in multiple boards of a smaller size over all ISC tracks over the next few years would be about the same as installing one monster board, Santiago said.
ISC wants a model that allows it to adapt to the rapid changes in video board technology, compared with sticking a permanent board in the ground that becomes outdated after 10 years, said John Saunders, the company’s president.
“The idea is mobility and best in class and being able to retrofit and update as the technology improves going down the road,” Saunders said.
Regardless of the business model and video boards in play, this season NASCAR fans can expect to see upgraded content on the screens branded as SprintVision, said Jill Gregory, NASCAR’s vice president of industry services. It’s another step to keep fans more engaged in the sport.
“In the past, it might have been static content with maybe some replay highlights and not a lot of voice-over,” Gregory said. “There will be more packaged entertainment focused on standings and interactive games that fans can text to. It’s more akin to what you see on the broadcast.”
The strategy behind the $400 million renovation of Daytona International Speedway is to build on the major league business model for developing a facility tied to founding partners and branded sponsorship zones starting at the entry gates.
To get there, International Speedway Corp., owner of Daytona and a dozen other tracks that host NASCAR events, turned to AEG for consulting on services including sponsorships, premium seating and booking more concerts and other non-racing events at their facilities.
As part of a multiyear agreement that started in 2013, AEG executives have been sharing best practices from their facilities with Daytona President Joe Chitwood and Craig Neeb, ISC’s vice president of development and chief digital officer.
“They were the first to admit their tracks are outdated with today’s guest experience,” said Mark Faber, senior vice president of AEG Global Partnerships.
“AEG is a very successful venue operator globally and best in class,” ISC President John Saunders said. “We’ve engaged them as we deploy this strategic capital over the next several years. It’s a new landscape and they’re very adept at it and willing to coach us along.”
Chicagoland Speedway will debut the Green Flag Garage.
Photo by:Chicagoland Speedway
AEG provided feedback on, among other things, ISC’s concepts for developing flexible group suite products inside the track at Daytona to accommodate 50 to 300 people, depending on demand.
“It reinforces that we were thinking the right way, that our sponsors are entertaining in smaller groups but still wanted a more high-end space,” Chitwood said. “The more knowledge we can gain as we make these renovations, the better off our fans will be.”
This year, ISC’s Chicagoland Speedway is developing new hospitality spaces that include the Green Flag Garage and Legends Club, track President Scott Paddock said.
AEG’s consultants took ISC officials, including Paddock, through their pyramid model for premium seating, starting at the high end with traditional suites and trickling down to the loge and theater box products trending at NBA and NHL arenas.
“As you go down the list, it was enlightening for us to know there is a larger universe of people who can opt in at that [reduced] price level,” Paddock said.
The Green Flag Garage at Turn 1 is a conversion of the Nationwide Series garage for the Sprint Cup race that now offers fans a pre-race experience with access to NASCAR drivers, plus a guided tour of the Sprint Cup Series garages. The track is selling 350 of those packages.
Those areas were previously off limits for fans before Sprint Cup competitions. The track follows the lead of Michigan International Speedway, one of the first to market an “open garage” for unprecedented access, said Jill Gregory, NASCAR’s vice president of industry services.
The cost for access to the Green Flag Garage is $149, which includes a Fan Zone Pit Pass valued at $50. The pit pass alone provides pre-race access to pit road and other event-level spaces. Race tickets are not included in the package.
“The things I’ve learned in three years in this sport is that race fans want access to the drivers up close and they are willing to pay for unique and premium experiences,” Paddock said.
The Legends Club, meanwhile, is a new all-inclusive suite designed for smaller companies that still prefer a high-end experience, he said. Situated in Turn 4, the group space provides a panoramic view of the start/finish line.
The season-ticket price is $1,445 a person for the track’s five racing events in 2014. For the NASCAR Sprint Cup weekend, Sept. 12-14, the price is $1,245 a person. For individual events, pricing ranges from $250 to $750 a person, track officials said. Those fees cover the cost of food and drink, including beer and wine. Hard liquor is a separate fee.
The Legends Club has a capacity of 160 and it replaces what was a combination of dead space and a portion of the press box, Paddock said. He compared it with Soldier Field’s United Club as a shared experience for firms entertaining four to 12 customers.
Chicagoland Speedway is still developing the full list of amenities for the Legends Club, but those patrons can expect retired NASCAR drivers to stop by and visit as part of their experience, Paddock said.
Tracks that host NASCAR events are in the same boat as other major league facilities, partnering with cellular carriers and other companies to upgrade connectivity at their venues.
Both International Speedway Corp. and Speedway Motorsports Inc. are installing new distributed antenna systems and Wi-Fi access points to boost coverage for users of mobile devices.
“We’re marching forward,” ISC President John Saunders said. “We have Wi-Fi already installed at Michigan and Auto Club Speedway. Other tracks will see installations through 2014 into 2015.”
ISC is also working with third-party provider American Tower to improve cellular coverage at its 13 tracks.
Daytona International Speedway, Chicagoland Speedway and Kansas Speedway have implemented those upgrades, and Phoenix International Speedway, Talladega Superspeedway and Auto Club Speedway are next on the list, Saunders said.
Sprint, AT&T and Verizon Wireless are sharing the cost with American Tower at the ISC tracks. The total investment is $52 million to cover all 13 properties, Saunders said.
At Texas Motor Speedway, SMI officials are working to improve connectivity for this year’s NASCAR events, track President Eddie Gossage said. The investment in Fort Worth alone is more than $10 million, Gossage said.
“Arenas and stadiums are small footprints comparably,” he said. “Our fans not only want that [coverage] for the speedway, which is 85 acres, but they want it for the entire 1,500 acres of speedway property. We have 40,000 campers, more than any other speedway, and they all want to connect to their mobile devices. … That’s a lot of bandwidth to cover.”
We asked NASCAR stakeholders to give their take on how the sport could grow. From track presidents to sponsors, they realize the importance of attracting a younger and more diverse crowd. But they also acknowledge the need to protect the core fan base that built NASCAR into what it is today. Here are highlights of their responses, which were submitted by email.
■ Where should NASCAR focus its attention to grow its fan base, from the track to the
COREY CHRISTANELL, ANHEUSER-BUSCH: I think NASCAR should focus on its core consumer. While they are getting older, they need to maintain the core while using new media to bring younger consumers in. I think they should capitalize on the sport’s regional strength and make new consumer entries within those geographies.
DAN GRIFFIS, TARGET: Every decision NASCAR makes should help to answer one of two questions: 1) How does it make it easier for primary sponsors and manufacturers to do business in the sport and 2) How does this grow our fan base at a rate faster than anything else a sponsor can spend their money on.
ANDREW CAMPAGNONE, SPORTS MARKETING CONSULTANTS: NASCAR needs to reach the younger demographic in schools and engagement around the STEM Education Coalition, which would expose the younger demo to the importance of automobiles to our country and also the importance of engineering and math. This would help expose them to the sport at a young age, so they would follow the sport. I also believe NASCAR should engage much deeper into the gaming space as kids and young adults have great interest in interactive gaming and real-life experiences using sports, and of course social media.
RON SCHNEIDER, SPORTS DIMENSIONS: Think young. Think diverse. NASCAR must be relevant in these two areas moving forward. For sponsors, the youth and growing Hispanic demographics will be their next customer base for growth. Focus on what is appealing to the younger market … digital/mobile accessibility (including Wi-Fi “net” at the tracks, relevant entertainment, such as “hip” bands) and partner with brands that are already connected with youth such as Red Bull, Apple, etc. Develop an emotional tie to the drivers that everyday young people can relate to. Regarding diversity, more emphasis on the similar attributes NASCAR has with Hispanics, for example family oriented, spiritual/faith, loyal, etc.
CHRIS POWELL, LAS VEGAS MOTOR SPEEDWAY: Maybe the biggest issue facing our sport ... is the need to appeal to younger fans while we continue to covet the fans who helped the sport grow in the ’80s, ’90s and early 2000s. Putting a great product on the speedway is still paramount, but we also need to develop younger racers and race fans and engage sponsors who play to a more youthful demographic, thus enhancing the live-event experience for the younger crowd. While our industry has done a good job of using social media as a means to communicate with prospective fans, we now are turning our attention to making improvements in the at-track experience through data communications and connectivity. Basically, we’re striving to keep NASCAR’s “cool” factor.
The panelists said NASCAR must prevent the erosion of its existing fan base as it works to build avidity among the youth demographic.
Photo by:Getty Images
JERRY CALDWELL, BRISTOL MOTOR SPEEDWAY: Some of the moves NASCAR has made as a sanctioning body in the past couple of years, from “boys have at it” to the recent changes to the Chase and qualifying procedures, are steps in the right direction. Fans want personality, they want intense competition and they want competitors who have a passion for what they do. We work hard at Bristol to create the entire experience, start to finish of the weekend, not just start to finish of the race. But the cause, effect and result of those races still drive the fans’ passion. Television is a critical partner in everything we do in exposing the masses to our sport. But to get the true, full, in-your-face experience, that comes at the track.
TYSON WEBBER, GMR: Engaging fans and consumers through content, technology and media will allow for a larger distribution at a time and place that is convenient for the consumer and can assist in growing the distribution and avidity of the sport. NASCAR reassuming its rights from Turner will allow for greater control of the product, but relevancy, creativity and quality will need to remain high to keep fans and potential fans engaged.
DENNIS BICKMEIER, RICHMOND INTERNATIONAL RACEWAY: The entire industry is focused on this, and the NASCAR Industry Action Plan outlines many key pillars to get there, so I think alignment and commitment to initiatives to support that plan is ultimately what will help grow the base. More specifically for us, some of our key initiatives are focused on fan access and providing opportunities to better connect fans with the stars of the sport, youth-oriented programs and providing quality all-day entertainment.
ADAM DETTMAN, MILLERCOORS: It won’t be one area of focus that drives fan interest and growth. Collective efforts across the sport with measured changes such as the modifications to the Chase format and qualifying demonstrate that NASCAR is prepared to embrace the future.
One interesting dichotomy — broadcast rights/television ratings versus track revenue/ticket sales. There may be a day in the not too distant future, especially for tracks that have two NASCAR Sprint Cup races during the season, where we could see a move to prime time TV in an effort to create ritualistic viewing occasions to infuse growth in NASCAR nation. Perhaps the 2012 Daytona 500 run on Monday night gave us a preview.
SCOTT PADDOCK, CHICAGOLAND SPEEDWAY: The sanctioning body, track operators and broadcast partners must collectively continue to invest in technology to deliver the most compelling race-day and broadcast experience possible to the fans. This past offseason, Chicagoland Speedway and other ISC facilities made substantial investments to upgrade the fiber optic infrastructure at our venues to ensure that fans receive the type of “connectivity” they are seeking while attending the live event experience.
A focus on the overall race weekend “experience.” While our avid fans make the race weekend commitment clearly to enjoy the exciting on-track racing product, we must deliver a compelling overall weekend experience for the casual and first-time fan in an effort to entice them to return to the venue. This event programming includes live musical entertainment, camping, tailgating, sponsor activation, kids activities, and providing unique access.
■ What are specific pockets of growth for NASCAR to build upon its base?
GRIFFIS: Today’s youth are not as enamored with owning a car and driving a car as they were 20 years ago. Some kids these days don’t get their driver’s license until they are 20 or 21. To love racing starts with the love of the automobile. Grow the love of the automobile with young fans and you will grow a new fan base.
SCHNEIDER: Make things easier on the fans. From better connections to their phones to lower ticket prices at the tracks, NASCAR has to work with tracks to produce a connected experience during races. Leverage the loyalty of the current fan by rewarding them or providing “friends and family” incentives. … Consider more awareness and visibility of NASCAR’s heritage … appeal to the good old days and throwback era.
Keep it simple … don’t overcomplicate the sport. Understand that NASCAR needs to change the formats to keep interest, like the Chase format. However, too much tinkering will confuse the fans and actually turn them off. It’s a fine balance, but to the current fan base, the tradition, driver personalities and competition is what brought them to the sport in the first place.
I would also say from a sponsor/corporate standpoint, the tracks are still overpriced on their activation opportunities such as display space and hospitality. … Many companies, including our clients, have backed off of entertaining at the track, and especially the suites. We are looking for creative ways to make the experience affordable, but it is definitely a challenge. It would be great to see discounts and incentives for larger corporate groups to participate on race weekends.
CAMPAGNONE: Hispanic demographic and establishing a car culture again with the younger demographic.
CHRISTANELL: I think they are doing some of the right things (i.e. Chase changes) to keep fans engaged
NASCAR received high marks for changes to the Chase format that emphasize winning.
Photo by:Getty Images
ALLISON: We at Ford have really re-aimed all of our outreach to the digital front. Because when you go to a digital format, it’s not just for younger consumers, it’s now mainstream. We reached over 1 million followers on Facebook just for Ford Racing. By using such tools, which NASCAR is doing and we are doing, it invigorates the opportunity for fans to follow the sport, both through social media and physically.
CALDWELL: Appealing to young fans now, building a great experience with their families, creates memories they want to pass along to their kids when they reach that point. However, we cannot take our eye off the ball of the loyal, longtime fans who helped us get where we are. You cannot have growth if at first, we do not prevent erosion.
WEBBER: There are a few pockets of growth that NASCAR could build on including multicultural and a more global audience, but a very important one is the younger audience and keeping the next generation of NASCAR fans engaged and interested in the sport. NASCAR has made good strides with several of its initiatives recently and a continued focus on elevating the drivers to superstar status will continue to help this cause. Elevating the drivers would help with a broad audience, but will have specific appeal to a younger audience.
Another interesting angle for NASCAR to build on its youth base could be to try and reignite the love affair with cars. Many of the changes NASCAR has made to the car has made it more stock in its look to make the connection back to the manufacturer and cars on the road. A focus from NASCAR and the manufacturing partners to rekindle the love affair with cars, parents working on it with their kids, could reignite a love for racing and NASCAR with a younger generation.
BICKMEIER: You have to look at initiatives to engage all three levels of fans: avid, casual and first time. Our avid fans can help us build the base by connecting them with casual fans at the track or other non-race day activities. If we can create experiences for avid and casual fans to interact, we can leverage their passion to elevate casual fans, and it isn’t just face-to-face experiences; social media is helping in this regard. We have to look at opportunities to introduce first timers to the sport by creating a thrilling and memorable experience at the track, providing excellent customer service, and building programs aimed at attracting families, youth and multicultural guests.
DETTMAN: Millennials represent a core growth opportunity for NASCAR. It’s the next generation of NASCAR nation. But for millennials, especially those in urban markets, where owning a car isn’t a priority, building relevancy for the sport can be challenging. NASCAR has made a concerted effort to bring “influencers” out to the track and leveraged the experience and accessibility for all the best the sport has to offer. Social media, fantasy sports, content creation — all efforts which build on the strength of a long season to create robust fan engagement platforms.
PADDOCK: We have the opportunity to grow our younger fan base from youth to 18-34, while also capturing the interest of multicultural audiences. These are key tenets of the NASCAR Industry Action Plan and significant resources, both personnel and otherwise, have been invested toward working these critically important initiatives. … If we collectively stay committed to the plan, we will see the benefits in time.
When seven-time NASCAR champion Dale Earnhardt died in a crash on the last lap of the 2001 Daytona 500, Austin Dillon was 10 years old.
Now, at the ripe old age of 23, Dillon is a rookie Sprint Cup driver who will not only begin his first year in NASCAR’s top series at the Daytona 500 this month, but will also do it in a car bearing the No. 3 that the late Earnhardt made iconic.
Austin Dillon will carry the number made famous by the late Dale Earnhardt.
Photo by:Getty Images
Talk about pressure. Beyond the legacy Dillon inherits, his sponsors must consider how the move plays with the fiercely loyal fans of the late Earnhardt. Everyone from sponsors to the race team and Dillon himself takes a respectful stance when asked about Earnhardt, but, at the same time, they said they have yet to encounter much opposition.
Cheerios and Dow Chemical will account for the majority of the 38 races as primary sponsors on Dillon’s car. Ben Schlosser, chief marketing officer at Richard Childress Racing, owner of Dillon’s team, declined to specify how the races will be shared.
“You’re always going to have people that have opinions, and that’s what life is about,” Richard Childress said. “But our opinion rating right now is in the high 90s [in favor of the No. 3 returning]. Our goal is to go out and try to win those people over. We want them to understand the way we’re doing this is exactly the way it was planned years ago.”
Childress said family, as in the connections between generations of drivers at RCR, is the only reason the number is coming back.
Late last year, SportsBusiness Journal reported Dow will pay RCR at least $6.4 million to have the primary rights for 16 races each season. Schlosser said one or two more sponsors with roles as primary backer will be announced soon.
Cheerios and Dow balance each other because one is a major consumer product and the other represents a campaign that emphasizes business-to-business sales.
General Mills, parent company of Cheerios, sponsored Dillon for his first Daytona 500 in 2013. Then, Dillon drove a car with the No. 33 and returned to the No. 3 in his regular Nationwide season.
This season marks the sixth year General Mills has been a sponsor at RCR. The company became a NASCAR sponsor in 1997.
“We were all very impressed with his polish and his professionalism — that sparked a lot of conversation about the 2014 season,” said Gregg Dorazio, General Mills manager of shopper marketing and motorsports. “And then the number was the icing on the cake.”
In December, when the primary sponsorship of Cheerios was announced, the cereal company launched an online
Cheerios used social media to encourage fans to “Cheer the 3.”
Fan content — thoughts and photos of their support — as well as behind-the-scenes moments cataloged by Cheerios are also included. Dorazio said questions prompt fans to respond with comments on when they started following the No. 3 car, favorite memories and races, and so on.
The cereal brand likes the generational connections, from Childress, who is Dillon’s grandfather, to the Earnhardts. Childress has said several times that he and Earnhardt discussed keeping the No. 3 active after Earnhardt retired, but likely only with an Earnhardt or Childress family member using it.
Childress said Earnhardt made the number famous, but stressed it has been part of his family for years. And the No. 3 can help emphasize the history of Earnhardt’s career for younger fans, he added.
“The history that was created with that number is Dale’s,” Dillon said. “I think that’s very special. … Does it create more pressure? I feel like it didn’t matter what number I got in. With my family background, there was going to be pressure.”
Dow Chemical had a supporting role with RCR for several years, working with the team on technology and other aspects of racing to use Dow products and expertise.
Last year, the company sponsored Dillon in a race at Indianapolis and backed RCR driver Jeff Burton as a lower-level sponsor in the Sprint Cup series.
Steve Henderson, president of Dow Automotive Systems, said the relationship with RCR has evolved and the sponsorship makes for a good investment. As part of the agreement, the two companies will collaborate further on testing materials and products.
Dow plans to focus on business-to-business relationships, eyeing both current and prospective customers.
Automotive, agriculture, and building and construction products will account for most of the Dow-NASCAR campaigns. Return on investment exceeded internal expectations last year when the lower-level sponsorship was added, Dow found.
“We’re very sensitive of the legacy [of No. 3] and we’re going to [bring it back] with ultimate respect,” Henderson said. Most of the Dow campaigns will be at the track, hosting customers and prospects, staging VIP tours and using RCR’s North Carolina headquarters for meetings — and to demonstrate how Dow powers the race teams.
Dillon has appeal beyond the track. He likes to hunt and fish, and play fantasy sports and paintball. He recently appeared in a cameo in the ABC series “Nashville.”
Those hobbies and his humility, along with a willingness to study what his sponsors are trying to achieve, make Dillon attractive, Dorazio said.
“He’s easily coached: We’ve done TV shoots, brand prep work and it’s all been phenomenal,” Dorazio said.
Throughout the season, Dillon and the No. 3 will be paired with Cheerios in consumer campaigns and promotions. At least one national TV ad has been filmed and General Mills worked with grocer Kroger this month to release a special-edition, NASCAR-themed Cheerios box to be sold only at Kroger. Convenience stores, large customers such as Wal-Mart and grocers will have in-store promotions tied to the No. 3 and Dillon.
Dorazio said a show-car tour will take the Cheerios-Dillon sponsorship to shoppers nationwide. Stops include Wal-Mart stores, auto shows and other retailers. Cheerios is an associate sponsor on the No. 3 when Dow and any other brands have the primary role.
Support from the late Earnhardt’s children for Dillon to revive the No. 3 should help, too.
“I’m very happy for him, happy for Richard, thrilled that the situation is what it is,” Dale Earnhardt Jr. said. “I think it’s a great time to bring the number back, and Austin has certainly earned the opportunity to race.”
Earnhardt said the move makes sense because Dillon has used the number for years, even while playing youth sports.
The legacy of the number goes beyond the elder Earnhardt and his famed driving career for the NASCAR team. Before that, Childress drove a car with No. 3.
Said Earnhardt, “He’ll add to the history and the heritage.”
Erik Spanberg writes for the Charlotte Business Journal, an affiliated publication.
For a NASCAR rookie, Brent Dewar knows the stock-car racing world pretty well. He joined the sanctioning body as chief operating officer in December after spending the past year as a consultant to NASCAR Chairman Brian France. Before that, Dewar worked for 32 years at General Motors, where he learned the value of NASCAR while running the Chevrolet division and later presiding over GM’s $3 billion annual media budget.
Dewar recently spoke with SportsBusiness Journal about his new position and where he’s focusing his attention.
ON HIS NASCAR ROLE: I’m running the business aspect, which is the sales, service and marketing operations of the business. Mike Helton as the president is leading the competition side of it. He and I are partners; we work very closely and we both report to Brian France.
Dewar became familiar with NASCAR during a lengthy career with General Motors.
And as a consultant, I worked closely with Mike on some of the changes on the competition side the last year. Complacency gets you in the wrong place. Everybody’s looking to innovate further. We’ve got great broadcast partners and they’re looking not to stay status quo. They’re looking to innovate as our track partners, as are we. That’s what great companies do.
ON THE IMPORTANCE OF THE 10-YEAR CONTRACT WITH FOX AND NBC THAT BEGINS IN 2015: This is a sports culture and we’re fortunate to be part of the sports culture. Look at all of the major sports, and we’re one of them. And [we have] great partners currently and great partners moving forward.
It allows access to our sport, to many households. What we’ve learned is it’s just not at the track or the broadcast. It’s everything. It’s just like media. You don’t just read a magazine or just listen to radio or just watch TV.
Media comes in all forms and you need to be consumer-centric. These new broadcast deals are the validation of the importance of the sport. If there’s a key word to all of this it’s innovation. You’re seeing innovation at the tracks; if you don’t get to go to the track, you can watch it on broadcast, and if you can’t make it to the broadcast or at the track, you connect through digital.
ON LEARNING NASCAR FROM THE INSIDE: I think the strategy has been well thought out over the last four years. We’re at various stages of implementation. I think the Industry Action Plan is a work in progress. My role is to keep that going and further enhance it as we go forward.
So my skill set is working across functions. That’s what I can bring to it. The first 120 days, I’m meeting all the stakeholders, whether it’s [the carmakers], the broadcast partners, internal staff or sponsors.
So I’m spending the first 120 days out of the office, seeing as many people as I can. I’m doing more listening than talking. … To be an effective COO, I should be able to hear those inputs and help make the engine fire on all cylinders a little bit better.
ON COMPETITION FOR THE ATTENTION OF SPORTS FANS: We’ve got to continue to not rest on our laurels. For the fan that’s brought us [to where we are] the last 50 years, we need to bring them with us. And we need to be engaging and thoughtful to the casual fan. Product relevance, the Gen 6 [car], focusing on the entertainment of the show at the event, social media or digital, not waiting [for the fans] to come to us.
It’s very difficult ... but it’s part of our challenge and assignment to get fans to stay connected.
ON BRINGING IN NEWER AND YOUNGER FANS: It’s a work in progress. Part of the challenge of any sport, any company, is to keep your core fan and attract the new fans. Millennials, we have to make sure we’re relevant, the connection points we use is where we go. That’s a long-term plan. You don’t change your demographics in a week.
Erik Spanberg writes for the Charlotte Business Journal, an affiliated publication.