Daryl Wolfe, NASCAR’s Chief Sales & Partnership Officer, met with the media Thursday morning to discuss the new sponsorship partnerships:
Congratulations on the new deals. Can you explain if these new premier partners will impact existing sponsorships across the industry?
DARYL WOLFE: That’s a good question. Let me back up and talk a little bit about why we went this direction.
I think you heard Steve down in Miami talk about during the State of the Sport address, looking at our business differently from top to bottom. Not just changing for changing, but thinking strategically how we want to go forward as a sport in so many different areas, whether it’s competition, whether it’s the tracks, whether it’s the sponsorship model.
So we decided 50 years is a long time. We’ve had a third?party kind of IP integrated into the series, whether it’s Winston, Sprint, NEXTEL, Monster Energy, all fantastic partners, have done a lot for the sport.
But we decided to change and flip the switch a little bit. We wanted to change this for a lot of reasons. One of the reasons, I can lead off with Sprint. If you look behind us, NASCAR Cup Series, that’s our brand. We think there’s fan development opportunities, there’s other activation opportunities for partners.
So to your question, it’s a complicated process. We started this process about 12 months ago. You have a lot of existing deals already there, out there in place, right? So Coca?Cola is a great example, been a fantastic partner of ours for a long time. They have exclusivities across many of the tracks and other elements of our business in existence, so those will not change.
A competitor of Coke actually still has some relationships. We are not sunsetting those deals. Now, once those deals expire, there may be an opportunity for Coke to pick up those tracks or those positions. But for right now, we did the best we could with the positions that we have across the sport.
Anyway, we’re thrilled with the four partners we have. We think they’re going to be fantastic partners. They’re emotionally invested in our sport and they’re going to do a great job promotionally activating around our sport in the future.
What about with teams, things of that nature? Will that limit teams being able to bring in sponsorship?
DARYL WOLFE: So no restrictions on the teams. In previous times, for example, the telecommunications category or the energy drink category, that goes away, right? We wanted to make sure it was easier for our teams to go out there, prospect and find brands. No restrictions on teams.
In regards to the four premier partners behind us, by the way, we’re thrilled with these brands, right? They’ve been in our sport for a long time. They’re invested in our sport emotionally, too. They care about the sport. They promote aggressively around the sport.
We believe they’re the right four partners for us going forward. But there’s no restrictions in regards to what the teams in the garage area can go do. That was an important component of this.
In addition to the four brands behind us, we wanted to make sure they had ?? and we had a dialogue and discussion around their investment across the ecosystem of the sport. So it’s just not tracks, it’s just not NASCAR the league, but they also have existing investments with the teams, the broadcast partners, NASCAR license media and so forth.
We are looking at these deals and agreements holistically across the entire sport.
They have exclusivity for the tracks and NASCAR, is that correct?
DARYL WOLFE: Unless there is an existing deal in place.
Let’s say you didn’t sell any of those, or just one or two of these, what is the gain like? Is it money involved? There’s projects that that money specifically goes to? I’m trying to figure out what’s the difference as far as what I’m going to see in your business.
DARYL WOLFE: So I’d say it’s a good question.
There’s two main reasons, right? We believe over the course, again back to my earlier point about the Steve comment and Jim France leading this sport, looking at it from top to bottom in a different way, right? How can we do things better? How can we grow the sport in the future? How can we do things that are better for the fans? Ultimately it has to be good for the fans.
But we want to do two things:
We want to make the sport be easier to do business with, right? When you think about there are so many points of entry across our sport, it can get very complex. We hear feedback from partners that, I have to make stop A, then I have to get a stop B, then I have to do an agreement of another entity C. It’s a very complex sport to navigate.
One of the things we wanted to do in a state of strategy from day one is make sure this sport was easier to do business with, right? So these four brands, again, we have an agreement with these four brands. We think we’ve cleaned that up to some degree.
The second thing, if you look at the brand behind us, the first brand, the first mark, is our mark. It’s the NASCAR mark. In the world of transitioning sponsorships, you think about from Sprint, from NEXTEL to Sprint to Monster Energy, the pinnacle of our sport is the NASCAR Cup Series, right? We want to lead with our brand. We think that is good for other partners because they’ve made an investment with our brand, the sport NASCAR.
We also think it’s good for fan development opportunities. When you think about new fans, I mean, tenured fans is one thing, they understand our sport, but for new fans that come in, what is the Sprint Cup Series? What is the Monster Energy NASCAR Cup Series?
We’re leading with our brand, the brand ‘us’, the NASCAR Cup Series, who we think from a fan development opportunity and fan engagement opportunities, it’s a big plus for us going forward.
These sponsors have already spent a lot of money in the sport, a lot of activation. You’re not going to tell me how much money they’re spending.
DARYL WOLFE: You’re right about that (laughter).
What is the difference? GEICO already has a bunch of things. Do you expect them to do new projects, new activations to what they’re doing?
DARYL WOLFE: So you’re right, I’m not going to answer anything about the financial terms of these agreements. I will tell you, though, we’re very pleased with the business terms. Our partners are very pleased with the business terms.
Also we wanted to make sure that we created more of a tethering to these brands across the ecosystem, all the stakeholders in the sport. That’s why we looked at these agreements holistically.
I think we can fall in the trap of trying to compare this deal to the Monster Energy Series entitlement deal. By the way, I’ve referenced a couple times Sprint, NEXTEL or Monster Energy. The last three years Monster Energy has been a fantastic partner to this sport, has brought a lot of engagement opportunities, excitement opportunities, have done a fantastic job. We just thought it was time to do something different.
In regards to these partners behind us, not only have they been involved in our sport for a long time, they activate around our sport and they promote our sport. They want the sport to succeed. So this was an opportunity to kind of clean things up a little bit, create more of a holistic approach for the brands behind us, and promote the sport in a more aggressive and seamless manner.
When a fan goes to the racetrack or watches or listens to the broadcast, what will the look and feel be moving forward? What will they see?
DARYL WOLFE: Thanks for that question. It’s a really good question.
I think the other thing that you may fall in the trap of is that you’re going to go to the first track in 2020 and expect a radical difference. This is a phased?in approach, right?
In regards to the mark behind us, there will be certain applications where you see the NASCAR Cup Series mark only, right? Certainly applications you’ll see a NASCAR Cup Series mark with the four brands in aggregate all together in certain applications around the racetrack.
In the marketplace, you may see a brand, the Coke brand, with a premier partner brand attached to it as well. There can be three different applications. That’s not to create confusion. It’s just that there’s three different ways of presenting this model to the fans and to the competitors alike.
In regards to signage at the track, we are attempting to create a more holistic look and more consistent look. Easier said than done. There’s a lot of agreements out there. It is a bit of a jigsaw puzzle.
What I would say is in year one you’re going to see a little bit of a change, year two you’re going to see more change. By the time you get to year three and four, I think you’ll see a lot of change.
When we talk about activation, how do you foresee I guess getting these companies out in the midway? A lot of the fan engagement that we hear, I know you do tons of research, we started bringing back some of the souvenir haulers. The atmosphere leading up to the weekend, Talladega is its own animal, parties in the infield, but how are they going to get involved in building the sport? When Sprint and NEXTEL came in, we really thought the opportunities were endless. I can remember being in Kansas City, Sprint was going to do this, that, put it on the phone, we were going to get real?time.
DARYL WOLFE: Sure.
How are we looking at activation? How will they take us or you, NASCAR, to the next level?
DARYL WOLFE: It’s a great question.
First, we were very selective in the brands that we chose, right? The four brands behind us are blue chip companies by any measurement, right? They’re also companies that understand our sport. They’re not new to our sport. We intentionally did that.
We wanted to go to companies that already had an investment across multiple stakeholders in the sport, understood our sport, understood how to activate around or sport. Intentionally we went to the four companies behind us.
Coke is a good example. So Coke this year, I’ll talk about at track in a second, but let’s talk about in marketplace. This year they have three X to four X the number of customer programs they’re activating around our brand, from custom packaging, to retail promotions, to account?specific promotions across the country.
Coke is a fantastic promotional partner of our company. They want to do more. They think they can do more because of this program.
GEICO, we’ve already talked to them. In every one of these conversations about how they can activate in the marketplace around themed advertising and take our brand and go out there and really promote our sport to greater and larger audiences. A lot of our conversations were focused a lot about what’s going to happen in the marketplace.
Conversely to your point, we also understand the fan experience at the racetrack is critically important. Coke does a great job of activating around our racetracks. GEICO typically has the display at the racetracks, interacting with our fans. A?B, same situation.
We also had conversations about more to come and more details on this about how they can take the fan experience to the next level. Steve said and Jim France has said it’s all about growing this sport. We think this is the right strategy, and these are the four partners that can help us grow the sport in the future.
When this first was brought out, we heard about multiple tiers. These are your top guys. There will be some lower tiers. Is that something akin to what we see in professional soccer where the board behind the drivers is transparent, has a bunch of logos?
DARYL WOLFE: Again, good question.
When we first went out and started having these conversations about 12 months, almost a year ago, one of the things that the people that we were talking to wanted to quickly jump to is, oh, this is just going to be like another sport. To use an example, this is going to be identical to that.
We were quick to say, there may be similarities in regards to that, our sport is unique. This program is going to be uniquely NASCAR. We are focused really on establishing positions at the top level around the NASCAR Cup Series. Again, I talked about why it was important to lead with the NASCAR brand first. We wanted to focus on those positions.
We also didn’t want to do anything to eliminate opportunities for our official partners. Nothing behind us and nothing about these four premier partners are going to eliminate our official partners.
We also wanted to do nothing to diminish the role of our OEs, OEMs, right? Toyota and GM and Ford are critically important, as well. But right now we just wanted to focus at the top level.
In the future, will there be some additional opportunities maybe at a different tier, or we’ll establish a different tier? There may be. Again, the focus has been for the last 12 months really on the four brands behind us.
With Monster going away, what does that do for a new trophy?
DARYL WOLFE: You’re jumping ahead of me.
We are working diligently on how that is going to be portrayed in the future. And I do want to mention Monster Energy. I mentioned earlier, they’ve been and will continue to be a really important partner in this sport. They’re not going to go anywhere.
Can’t thank Mitch and everybody at Monster Energy for what they’ve done the last three years. Excited about what they’re going to do in the future, as well.
This was a decision by us. We wanted to go this direction. We thought this was the right thing for the sport going forward from a consumer as well as a corporate standpoint.
I can tell you the conversations we’ve had with partners, with industry stakeholders, people around this sport, they also agree. Everyone’s excited about this. It’s just part of kind of a broader plan going forward in 2020 and beyond.
Everything these days is data driven. Microsoft or Amazon web services, NASCAR is getting into Esports. How hard would this be for another company to say, We’d like to be a premier partner, too? Would you need the other four partners to sign off on it?
DARYL WOLFE: That’s a really good question. Appreciate that.
From day one, we wanted to be very selective on the brands we chose. I talked about that already. We also said at the top level, the premier level, we were going to build out a program and a position for three to five companies. We landed at four. We’re really, really happy with those four.
In the future, we’re going to always evaluate our business. This is no different. We’re going to look at what’s the right thing for the sport going forward, just like we do across every other vertical in our business. We’ll continue to evaluate it, look at research, see if there’s additional opportunities.
But we set out to do three to five. We got four, right in the middle, and we are extremely thrilled with the four that we have secured. They are, as well.
(Question about length of the four different partners sponsorship.)
DARYL WOLFE: We intentionally wanted to stagger the lengths of the terms of these agreements. The agreements of the four brands behind us vary from three to five years.
The Daytona 500 is not partnered. Is that part of the agreement that you can’t do it? Why was the Daytona 500 not one of these races?
DARYL WOLFE: That’s a good question.
These brands will have a presence around Speedweeks, obviously Daytona 500. We did not include the Daytona 500 as kind of a jointly owned entitlement. We wanted to reserve our championship event at ISM Raceway as well as the All?Star Race for the four premiers behind us.
We just feel Daytona 500 is a bit different. We wanted to kind of keep that as an outlier. Also keep in mind for our Daytona Rising Project, too, we have a number of founding partners there that have a pretty large presence. We wanted to find the right complement for those founding partners as well as the premier partners behind us. The Daytona 500, we’re just treating that a little bit uniquely, that’s all.
We wanted to find a right balance, really wanted to focus these four brands on the All?Star Race and the championship weekend at ISM Raceway.
One of the challenges is trying to make the All?Star Race stand out. Obviously this sport in essence is an All?Star Race every week. How are you trying to make that All?Star Race to be as strong or stand out even more? How did you make these partners part of the All?Star Race? How do you try to hope to elevate that?
DARYL WOLFE: We always want to elevate the All?Star Race. We want to elevate any race.
In the past we’ve always had a single entitlement partner on that race. These brands have done a really nice job. Obviously SMI, Marcus, and the team there do a really nice job around that event.
With these four brands, we’re having conversations right now to do exactly what we’re talking about. There will be more details to come on that. But we’re talking about how to elevate that race.
No different with our championship race. Think about the championship race down in Miami. Ford was about 17, 18 years, the championship weekend down there. They did a wonderful job of promoting that weekend. But it was only Ford, right?
When you think about our championship event, we wanted to make sure it was a bit more inclusive. With the four brands behind us, they’re going to have more of a larger presence around that championship race. They’re going to take the brand in that race in the market and activate around it. There’s some additional opportunities there.
We’re talking to Julie Giese at ISM Raceway, talking to the guys at SMI, talking about the four brands behind us to elevate both of those events in the future.
(Question about sponsorship for the championship race.)
DARYL WOLFE: There will not be a seasonal entitlement. We’ll have news on how that’s going to be positioned. The four brands behind us will have a major involvement around the championship race in 2020.
From the days of Winston, you’ve had Miss Winston, models. Is that a thing of the past starting next year?
DARYL WOLFE: We are still working through our relationship with Monster Energy. There will be more to come on that. But I can say that how it’s been portrayed in the past, i.e. 2019, it will look different in 2020.
Do they have windshield cleaner rights on this? If not, who does?
DARYL WOLFE: They do not. Still being TBD. More details to come.
This might be more a question for Steve. Do you expect signing of these four companies is going to impact significantly the scheduled discussions for 2021?
DARYL WOLFE: I think these are two independent conversations. Schedule conversations are critically important. We listen, the collaborative nature of the sport has been well documented. Steve has talked about that a lot. It’s really important to us.
When you have major stakeholders and major people that have an influence in this sport, you listen. But these are two independent conversations. This deal, as well as this future schedule conversations.
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