While NASCAR's unified TV package is "expected to
produce higher TV ratings, advertising rates are expected to
rise, taking the price of team sponsorships with it,"
according to Jeff Owens of NASCAR WINSTON CUP SCENE, who
writes that many team owners "fear the rising costs will
surpass what many sponsors are willing to pay." Valvoline
Sports Marketing Coordinator Chris Schwartz said that the
new TV deal will "drive the cost of sponsorships up, but
more importantly, the cost of running ads during the race
telecast is going to go up. ... It's going to drive the
overall costs up." However, NASCAR COO Mike Helton said
that the impact of the new TV package "is going to come from
the additional exposure and the different opportunities that
we may find from the ancillary business that can be tapped
into that we don't even know about today." Owens writes
that "most team owners believe they should get more than the
typical" 25% share of revenue from the new deal, since
rising costs could cause some team sponsors to reduce their
level of financial support (WINSTON CUP SCENE, 3/11 issue).
TARGET BIG MARKETS: BLOOMBERG NEWS' Rick Westhead
writes that tripling its TV income "may be difficult" unless
NASCAR "does a better job of reaching affluent viewers in
the bigger urban areas." Ladenburg, Thalmann & Co. analyst
Bill Scovin: "You don't run a lot of Saab or Mercedes or
Jaguar ads on Nascar programming" (BLOOMBERG NEWS, 3/11).
