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Volume 21 No. 38

Marketing and Sponsorship

Motorsports marketers met last week’s surprising news of NASCAR possibly overhauling its sponsorship model in 2020 with cautious optimism, but the plan still has an array of unknowns.


NASCAR announced a one-year extension with Monster Energy as title sponsor of its premier series through 2019. But Steve Phelps, NASCAR’s executive vice president and chief operating officer, revealed at the same time that NASCAR is looking closely at changing its commercial model in 2020 and moving away from one title sponsor in place of several top-tier partners who acquire rights to the league’s top assets, plus other secondary partners.

Such a change — which would include bundling assets between the league, tracks, teams and media-rights partners — would be a dramatic shift in a sport that has had a title sponsor since Winston first signed on in 1971.

What it means

NASCAR could move away from a single title sponsor for its racing series and instead sign a group of top-tier partners.

NASCAR would bundle assets across the sport, including with the league, teams, tracks and media partners.

The model would be similar to systems in play at the NCAA, IOC and the English Premier League.

The proposed model is in its infancy and still being developed, and Phelps admitted that a final decision on what it would look like — or even if it would be adopted — has not been made. But industry executives largely believe a new model would benefit a sport that’s had the same model for nearly 50 years. 

“The current NASCAR sponsorship model with a big title sponsor, several official sponsors and separate track partners creates clutter and tight restrictions on categories,” said Ashlee Huffman, general manager of CSM Sport & Entertainment’s motorsports division. “NASCAR created a fantastic model back in the day, but … if they go to a new structure that removes the title, that can give the opportunity for a handful of partners to make a bigger impact and clinch their category for clarity and real engagement with consumers.”

NASCAR’s proposed model was compared to the sponsorship framework of the International Olympic Committee, NCAA and English Premier League. The NCAA, for example, has three top-tier Corporate Champions in AT&T, Coca-Cola and Capital One, while it has 15 secondary Corporate Partners that get more limited rights.

NASCAR has more than 50 official sponsors, including three national series title sponsors in Monster, Xfinity and Camping World. Monster pays $20 million annually, while Xfinity pays closer to $10 million and Camping World pays closer to $5 million. How the sanctioning body would divvy up official sponsors into different categories under a new model was unclear, but Phelps hinted that there could be a tier for business-to-consumer brands and a different tier for business-to-business brands.

Daryl Wolfe, NASCAR’s senior vice president and chief sales and partnership officer, said NASCAR is still working through how it would handle existing partners, including if they would be shifted into new tiers. He acknowledged the task will be complicated because of the different levels of deals that have varying expiration dates. Wolfe said the idea to examine a new model came out of consensus from high-level executives associated in the sport at the team, track, media and sponsor level, and that any change would have to fit into the culture and framework of the sport.

NASCAR may move toward a tiered sponsorship model instead of a single title sponsor.
Photo: getty images

“We have to make sure it’s uniquely NASCAR, and there are some certain characteristics to that — one is just the sheer number of companies [that are already official NASCAR sponsors],” Wolfe said. “Thankfully we have all these companies investing in our sport, but that’s a lot of volume that we have to sift through and manage to make sure they’re all getting a return. Candidly, a lot of those other sports don’t have that level of involvement. That’s a luxury we have, but it also adds a layer of complication that we’ll have to work through.”

Wolfe moved in December from solely being an executive at International Speedway Corp. to holding dual roles at ISC and NASCAR, and several industry executives remarked last week that the revelation of a new sponsorship model with greater bundling between leagues and tracks further underscores why Wolfe was assigned dual roles.

Phelps, who said the idea of a new model has been considered for a few years, added that working closer together with track and TV advertisers is a major impetus behind the consideration. NASCAR has been working to make it easier for sponsors to navigate the complex sport, because some companies have been frustrated by the multiple stakeholders needed to execute across the landscape. If successful, NASCAR hopes it could create a one-stop shopping model that makes it easier to buy into and across the sport, and result in stronger activation.

NASCAR also likely recognizes that moving away from the current model could help it spread its sponsorship revenue across multiple companies and do away with an asset that diminishes every time it trades hands. The premier series title sponsorship is being seen as an increasingly hard sell with its high price tag coming in an era where brands want to spread their assets among different platforms and do shorter-term deals.

Winston was title sponsor from 1971 through 2003. Sprint-Nextel then became title sponsor in 2004 through 2016 before Monster took over in 2017.

Jimmy Bruns, senior vice president of client consulting and services for GMR Marketing, which has multiple sponsors in motorsports, said that if NASCAR doesn’t get $20 million from a title sponsor but the new model “creates a scenario where more brands can be involved in a more significant way and have assets across the board, the benefit to NASCAR in terms of healthier teams and tracks far exceeds that potential $20 million they’re getting from that title sponsor only.”

To the extent that we can create more opportunities for brands to engage in the sport in a bundled manner, I believe that’s a positive outcome.
Steve Newmark
Roush Fenway Racing

NASCAR is likely to focus on bundling league, track and TV assets to start because those are the easiest assets to line up, but Wolfe said the league would eventually include teams in the structure whether through directly bundling assets or referring new partners to do separate deals with teams. Teams rely on corporate sponsorship revenue for about 75 percent of their annual total revenue.

Rob Kauffman, chairman of the Race Team Alliance and co-owner of Chip Ganassi Racing, did not appear to be a fan of a potential new model when he noted the already crowded sponsorship market by posting on Twitter: “Saturation of the market and take needed sponsorship sources away from the teams. #terrific.”

But Steve Newmark, president of Roush Fenway Racing and co-chairman of the Team Owner Council that was formed from the charter system, said the concept has potential.

“Our sport needs to continue to evolve and change is part of that,” Newmark said. “To the extent that we can create more opportunities for brands to engage in the sport in a bundled manner, I believe that’s a positive outcome.”

Phelps said Monster is not expected to come back in 2020 if NASCAR were to end up keeping its current model with one title sponsor, though Monster executive Mitch Covington later told SportsBusiness Journal that the company is open to the possibility of participating in a new structure, were it to come to fruition. NASCAR observers will be watching to see if current partners are interested and how many current or new sponsors in the sport snap up any newly available assets.

“For the right price and right assets, it would be something we would want to look into,” said Patrick Judge, senior marketing planner of experiential and brand promotion for Geico, which has several deals throughout NASCAR including with teams, tracks and media partners. “We are focusing on reaching the consumer beyond the normal mediums.”

NASCAR did not say when it had to make a final decision, though it has close to two years before the 2020 season starts. But given the complexities involved in an already complicated sport, NASCAR executives will have a busy rest of the year trying to arrange the system.

“From a financial liability perspective, let’s say you go out and get four or five platinum partners at $5 million per year,” said Matt Wray, vice president of business development for CSM Sport & Entertainment, who recently joined the company. “When one of those decides to leave for any reason, we’re not in a total panic, because we still have a good core here, can go replace them with another $5 million brand and don’t have to spend two years going, ‘Oh my gosh, where am I going to find my next 15 to 20 million [dollar] sponsor?’”

The MLS San Jose Earthquakes have awarded CSM agency LeadDog Marketing, along with CSM’s property sales unit, the rights to sell the team’s jersey sponsorship.

Earthquakes COO Jared Shawlee said the team has been looking to expand its sales capabilities since early this year. “Actually, we didn’t start out looking for a [sales] agency,” he said, “but LeadDog’s creative approach to sponsorship, along with CSM’s sales expertise and understanding of what makes soccer unique, was something we hadn’t seen anywhere.”

Sutter Health’s deal ends after this season.
Photo: getty images

Health care is the predominant category across MLS jersey rights, accounting for four sponsorships. Sutter Health is the Earthquakes’ three-year incumbent jersey sponsor and its rights end after this season. Through 2017, MLS kit deals averaged around $3 million per year, but given the franchise’s location, the Earthquakes hope to tap the technology sector for one of the league’s top deals.

“We’re going to take a unique approach into the technology space,” Shawlee said, “and Dan [Mannix, LeadDog president and CEO] and the LeadDog team showed us some really good, creative approaches there.”

BIG CHEESE: After decades sitting at the junction of sports and commerce, it has to come to this: We can finally write that a sports property has sold an official cheese designation. To borrow one of the bon mots that “Seinfeld” popularized: Not that there’s anything wrong with that.

So we can now say with some conviction, if not revelry, that the U.S. Tennis Association has signed a three-year deal with Cheeses of Europe, making the cooperative of French dairy farms and cheesemakers the “official cheese” of the U.S. Open Series. It’s the organization’s first sports sponsorship.

More than 10 varieties of fermented curd will be sampled at the series, which begins July 23. The sponsorship also includes court signage, TV inventory on ESPN2’s U.S. Open Series telecasts, digital advertising inventory and hospitality. Cheeses of Europe will stage its own events for bloggers and other foodies around the series and will bounce that sampling audience to retail partners. Various cheese offerings will be integrated into on-site restaurant menus.

USTA Chief Revenue Officer Lew Sherr acknowledged that while he was not necessarily actively mining the dairy products category for riches, tennis demos matched well with what the cheese marketers were seeking, especially since the average attendee spends seven to eight hours on site, leaving plenty of time for fan engagement.

“To some degree, our events are food and wine festivals, and this reaffirms that,” Sherr said.

Subsequent research revealed that while cheese is not a familiar sponsorship category, deals granting properties the “fromage officiel” designation aren’t unprecedented. Of course, the Green Bay Packers have one. Sargento has been the official cheese of the Cheeseheads for more than 15 years. “Artisanal cheesemaker” Yancey’s Fancy, Corfu, N.Y., signed on as the Buffalo Bills’ official cheese in 2014, later expanding those rights to include both Terry Pegula-owned teams by adding the Buffalo Sabres. Since the Sabres haven’t qualified for the Stanley Cup playoffs since 2011, surely some fans have wondered whether the team or the cheese is more malodorous.

Big East Conference CMO Ann Crandall recalls selling Italian cheesemaker Grana Padano a sponsorship deeming it the New York City Marathon’s official cheese some years back, adding that she balanced it out with a Peanut Board sponsorship.

KD & DKC: Kevin Durant and business partner/manager Rich Kleiman have retained New York-based communications firm DKC to assist with PR and strategic counsel for their Thirty Five Media, the investment portfolio of The Durant Co. and Durant’s charitable foundation. Thirty Five Media earlier this year announced a deal with Imagine Entertainment and Apple to develop a series inspired by Durant’s youth basketball experiences that Durant and Brian Grazer will executive produce.

Terry Lefton can be reached at

The Chicago Cubs have signed a multiyear naming-rights agreement with Illinois-based insurance brokerage and risk management firm Gallagher for the club’s year-old Park at Wrigley.


The outdoor entertainment plaza adjacent to Wrigley Field will be renamed Gallagher Way. The deal also includes the ballpark’s Western Gate and left field bullpen door. When the Cubs have a lead, a new video-board feature will brand late-inning Cubs runs as Gallagher insurance runs.

Financial terms were not disclosed, but the deal is a landmark Legacy Partnership, the Cubs’ top sponsorship tier. Those deals typically include commitments of at least a decade and seven-figure annual spends. Sources said the deal is similar to low-end MLB ballpark naming-rights deals.

The agreement was brokered between the Cubs’ Marquee Sports & Entertainment and Gallagher’s senior management.

“We found a lot of compatibility with Gallagher’s leadership, particularly as it relates to giving back to the community and what we want to do with the plaza,” said Colin Faulkner, Marquee vice president and Cubs senior vice president of sales and marketing.

Gallagher’s prior sports sponsorship activity has included support of Chip Ganassi Racing in IndyCar.

“We’ve been involved in sports before, but we’re excited to participate now in a different way,” said Christopher Mead, Gallagher chief marketing officer. “And we really like what this plaza represents. It’s in sports, but it also transcends sports.”