The rising cost of motorsports is causing many automakers to rethink their racing strategies.
Being No. 1 is still the name of the game, as big wins continue to define brand leadership in engine performance, muscle and new technology.
But as motorsports costs continue to rise, getting the maximum return on investment for every dollar spent on auto racing has become almost as important as winning.
'Automakers are becoming very careful about what they spend on auto racing, because costs continue to go up. ... There are more viewers, more races on TV, and the cost of advertising on racing programs continues to rise,' says Eric Wright, vice president of Sponsors Report, an Ann Arbor, Mich., firm that analyzes and publishes the comparable advertising value of on-air auto racing exposure (see chart on Page 2i).
Sales strategy is increasingly driving decisions about what brands and models go racing, and dealers are being asked to get in on the act, helping to market auto racing at the local level (see Page 10i).
'As motorsports becomes more competitive and costly, automakers are putting a bigger emphasis on targeting potential buyers with racing efforts instead of merely supporting racing for the benefit of the sport's diehard fans,' says Tom Cotter, president of Cotter Group, a fast-growing, 50-person agency in Harrisburg, N.C., specializing in auto racing marketing, entertainment, licensing and merchandising.
Motorsports marketing tactics coming into play include:
More assistance for dealers to orchestrate local marketing efforts.
More strategic and efficient use of targeted marketing and general advertising.
A heavier reliance on media and public relations channels to reach consumers.
'Sponsors are starting to tap more channels to get more out of their investment in auto racing, using hospitality, entertainment and public relations more effectively at the local and national levels, but there's a lot more room for improvement,' says Ernie Saxton, editor of Motorsports Sponsorship Marketing News in Langhorne, Pa.
Ford Motor Co.'s decision to replace the discontinued Thunderbird in its NASCAR stock-car racing program with the Taurus is the most dramatic example of the new forces affecting auto racing.
Although some were initially skeptical of the decision, Ford is pleased with results so far and says the switch dovetails with Ford's new marketing mission of making auto racing more relevant to prospective car buyers.
After each win, Ford congratulates its drivers and announces its victory in national print ads; the company is also heavily promoting its wins through media and public relations.
'We've noticed announcers are referring to our car as 'the Taurus' rather than 'the Ford' more this year, which is a positive step. It's more specific to our brand marketing goals, and it gives the fan more tangible information about the cars we're racing,' says Mike Jarvis, Ford's director of publicity for U.S. motorsports.
The Taurus also benefited from a major media splash when the announcement was made last year and the car made its first appearance on NASCAR tracks.
'We developed the Taurus racing model in just nine months, instead of the usual time frame of about two years, and we've been able to capture a lot of media interest and consumer curiosity during the development process,' Jarvis says.
To capitalize on its presence in racing series around the world and to maximize marketing efforts, Ford recently hired Torrey Galida, the company's first global motorsports marketing manager.
Straight off, he began crafting long-term consumer promotions designed to bring new audiences closer to Ford's race vehicles, especially F-series trucks used in the NASCAR Craftsman Truck series.
To celebrate its new role as the Official Truck of NASCAR this year, Ford is building 3,000 special NASCAR versions of the F-150, each painted with racing logos and seats embroidered with the NASCAR logo. The pickups will ship to dealers in June, selling for about $20,000 each.
General Motors also is putting new emphasis on racing efforts with more product-specific programs this year.
The first-ever national NASCAR event-marketing promotion for Chevrolet's Monte Carlo brand was so successful last year that the tour is being doubled this year to a total of 90 stops nationwide.
The tour features a racing version of the Monte Carlo driven by Dale Earnhardt and includes interactive games simulating a Winston Cup race. It includes a turnkey kit for dealers to get maximum publicity and participation.
Oldsmobile's involvement with the Indy Racing League is paying off with loads of publicity for the Aurora brand.
Oldsmobile engines won every IRL race through April, and the company has been publicizing its victories in national print ads.
It also is capitalizing on its success with dealer events demonstrating the Aurora, plus its first national promotion linking Oldsmobile with the IRL. Four prize winners will get an expenses-paid trip to the Indy 500 and the chance to be handed the keys to a new Aurora by driver Arie Luyendyk.
This year, Oldsmobile is adding the Alero to its marketing, promoting the car at IRL events and through dealer promotions. In July, the Alero will star in a promotion surrounding the IRL race at the Charlotte (N.C.) Motor Speedway, says a spokesman.
Nissan: Value without wins
Nissan Motor Corp. U.S.A. says its decision to supply Infiniti engines for IRL race cars beginning in 1996 has been a publicity coup, even though the engines have not won any races through April.
'The lack of tangible success on the racetrack has somewhat hindered our ability to market certain aspects of our presence at IRL, but overall it's been a very successful effort for us,' says Marty Fiolka, who handles Nissan's motorsports marketing efforts through Rennsport Communications of Long Beach, Calif.
When the Infiniti engine wins, Nissan plans to crow about it in national print ads and a public relations campaign, but even without winning, Nissan has garnered 'significant brand awareness' increases through its participation in the IRL, Fiolka says.
Nissan plans more hospitality events in regions near IRL races this year, where the new Infiniti G20 sport sedan will be shown. More than 200 potential Infiniti buyers, identified through research and database marketing, are being invited to racing events in various regions at IRL events, Fiolka says.
'Winning is important, and we're confident we'll get there, but meanwhile we're making the most of the opportunity to market our presence at these events,' he says.
Involvement in the CART series is working extremely well for Mercedes-Benz by providing broad international exposure, but parent company Daimler-Benz AG also is pleased with its racing activities at other circuits, including Europe's FIA GT Championship, where the company races its Mercedes CLK coupe.
'The series was new, the car was new and it was a perfect opportunity to showcase the performance and power of a new (vehicle) brand through racing when we came aboard,' says Steve Potter, Mercedes-Benz of North America Inc.'s supervisor of sports marketing.
He says in the United States, Mercedes is ramping up its advertising and marketing surrounding its racing wins to draw attention to some of its new racing activities.
'We want to inspire consumers through our racing, and the best way to do that is to show them the pizzazz and muscle of our cars - and do a better job of telling people what racing means,' Potter says.
BMW of North America Inc. has the same goal with its heavy involvement in European racing, primarily with the M3 brand, which is winning races overseas in series such as Germany's Super Touring Car Championship.
Instead of using dealer events and local promotions to tout its racing wins, 'we use targeted media to reach motorsports enthusiasts, because this audience is generally very interested in our performance, and they're watching each development closely. They want lots of information about our racing,' says Rob Mitchell, BMW's product information manager.
With each win, BMW places national print ads in motorsports enthusiast magazines. It also targets higher-income executives and businesspeople by announcing its wins in the Wall Street Journal instead of USA Today, which is used by the majority of motorsports sponsors to announce wins.
'We have collateral material specifically about racing for customers, and we do a lot of communication about racing through our 45,000-member BMW Car Club, whose members follow racing very closely,' Mitchell says.
Less for some
Some companies have gotten out of the major series or out of motorsports altogether as opportunities to maximize marketing efforts have declined.
As demand for two-door sporty cars fell off, Chrysler found itself without an appropriate model for stock-car racing. These days, Chrysler is concentrating its racing efforts on Dodge trucks in the NASCAR Craftsman Truck Series and the Viper in overseas events.
Chrysler advertises its motorsports efforts in targeted enthusiast magazines and uses public relations to spread the word about its wins.
'We've discovered taking a shotgun approach is inefficient,' says spokesman Tony Cervone. Instead, the automaker targets the message, using radio talk shows and track events to talk about engine performance and technology.
Saab Cars USA ended its involvement with Pro Rally racing with last year's season, although the company still offers prize money to winners at some events.
With its estimated $55 million U.S. advertising and marketing budget, racing was not the most efficient strategy for the company, says Saab spokesman Dan Prescott.
'We weren't finding the right connection to reach consumers,' he says, 'and we decided to re-evaluate.'
Kate Fitzgerald is a free-lance reporter based in Chicago.