Taking stock | Nascar plots its future

  • Attendances and TV ratings down
  • Sport hopes that new sponsor Monster Energy will attract younger audience
  • Series looks to promote next generation of drivers

By mid-2016, Nascar had realised it was at a crossroads. For a sport in which the cars almost always only turn left, that's a difficult position to be in.

Attendance had slumped. TV ratings were down. Some big stars recently left the sport and others could be doing so in the near future.

Perhaps most significantly in a sport so dependent on outside dollars, sponsorship funding had become tricky.

Throw in Sprint stepping away from its naming rights, for which it paid between $50m (€47m) and $70m per year, and stock car racing needed to, well, take stock of nearly everything it was doing.

As the 2017 season began with Nascar's biggest event, the Daytona 500, the vibes emanating from most folks remained concerned, even sceptical. But the race was a sell-out of more than 100,000 spectators.

So, what could be in store for Nascar?

VIDEO: Monster Energy on site for the 2017 Daytona 500

Monster move

Monster Energy signed on as the new title sponsor, albeit for far less than the 10-year, $1bn deal Nascar executives had floated as an asking price when Sprint announced in 2014 that it was departing after the 2016 season. The annual payments from Monster Energy will range between $20-30m.

Still, Nascar didn't exactly go begging and the new agreement could bring benefits far outside the realm of where stock car racing had reached.

“We do have some ideas about how we can make Nascar more attractive to what I would call a different audience,” says Mark Hall, Monster's chief marketing officer.

The caffeine-rich energy drinks – Monster's M logo with a green claw recently appeared on Tiger Woods' golf bag – are most popular with a demographic that Nascar was struggling to entice: young consumers with leisure money to spend. Monster already has the most volume sales in its market – 18 years old and above – in a niche that has grown by almost 75 per cent in the last half-decade or so. In 2016 Coca-Cola paid $2.2bn for 16.66 per cent of Monster's stock, further elevating the profile of the company.

Monster is also the leading sponsor in Supercross, where it extended its agreement through to 2021, as well as Motocross. It is involved with events across America, and is also a marketing leader in action sports and the X Games.

“We are perhaps looking to be able to expand our age-group demographic. Nascar was looking for us to perhaps take their age demographic down a little bit,” says Monster Energy chief executive Rodney Sacks. “So, really it became a good marriage between us, because of what we both wanted out of it.”

Over the last two decades, Nascar has expanded its reach geographically, with races becoming a fixture, not only in the South and Northeast, but in California, Las Vegas, Dallas-Fort Worth, Chicago, even in the plains at Kansas. But its fan base generally has been older, a group that Sprint (and Nextel before it) played well among.

“The activation and things that Sprint did, the advertising, the places that it put us on top of what we already had – I think it's important that (the new partner) take us places that we haven't been,” says Kevin Harvick, the 2014 Cup champion. “They need to have a good advertising campaign to make sure that it's the right thing to push the sport forward.”

That’s the plan, whether it means title sponsorship, financial support for a car or bringing out the scantily-clad Monster Girls – a sure step to attracting the eyeballs of a younger generation.

“Monster Energy is the perfect series sponsor for Nascar at the perfect time,” says Texas Motor Speedway president Eddie Gossage. “Monster's ability to market their association with Nascar is important to the sport. All sports need more young people exposed to their 'game' and this will serve Nascar well.”

Format change

Here's where things could get tricky. Nascar has made major alterations to its races – moves that were planned even before Monster Energy climbed aboard, but were encouraged by the new sponsor and by broadcast partners Fox and NBC.

Fearing that the next generation of Nascar fans did not have the time, patience or the attention span to stick with its events from beginning to end, Nascar opted for segments within the races. Basically, each race, from the 500-milers on ovals to the shorter ones on road courses, will be broken into three parts.

Drivers will get bonus points for where they finish in the top 10 for each of the first two segments. The final segment will determine the race winner.

There will be timeouts between segments, and Fox and NBC have promised to load most of the commercial breaks into those slots.

If the format sounds like ‘Nascar Live’ or ‘Nascar Heat’ or any of those other video games, well, that’s because they are inspired by those video-game formats.

“As a driver, I'm happy to be rewarded for performing well throughout the event, not just for how I finished,” says Dale Earnhardt Jr., voted Nascar's most popular driver for 14 years in a row. “It'll tick you off if you're in that car for enough races and you're whooping everybody's butt all day long, and then you get beat by somebody who's running 20th all day, just by circumstance, how the cautions fall late in the race.

“So, it's going to be great to be rewarded as a driver for consistently performing well throughout an event.”

Other series

Nascar has made the same changes for its two other series, Xfinity and Camping World Truck. Unlike Sprint, both of the sponsors for these events remain in place and seem to have embraced the format alterations.

Both of those series tend to feed their best performers to the Cup level, and Nascar likes the developmental aspect of both categories. However, due to concerns that too often the Cup stars such as Kyle Busch would also suit up for Xfinity or Truck events and then dominate them, a new rule now limits such forays.

Any driver with more than five years of full-time experience will be allowed a maximum of 10 races in Xfinity and seven events in the trucks. It has been argued that more fans attend those series' races when bigger names participate, but Nascar’s chase for a younger audience comes into play here, too. The sanctioning body reasons that establishing standouts on those levels eventually leads to a wider base of stars throughout the stock car world.

Just in case they are wrong, though, Nascar did not completely ban Kurt Busch, Kevin Harvick and others from their sojourns downward. And by allowing drivers with less than five years as full-timers in the Cup to still compete whenever they want in Xfinity, where the cars are lighter and slower than in the Cup, or in trucks, such rising stars as Chase Elliott, Austin Dillon, Kyle Larson and Ryan Blaney remain eligible to run in more than one series on a regular basis.

Those four are among the “new wave” of guys behind the wheel that Nascar is promoting.

Jim Cassidy, Nascar’s senior vice-president of racing operations, adds: “You see the number of drivers coming up, and the desire and the calling of the fan base to say, 'we're interested in who's coming up through the system.’ They want to hear the stories and understand who these drivers are, so that they can begin to formulate and build their future roster of drivers that they root for.

“All three of the national series provide really an unprecedented level of competition; it's on us to make sure that we find the right balance, as the league, to say that there is some level of participation by Cup drivers in Truck and Xfinity and what that balance is.”

EXTRA: Talent drain

Jeff Gordon retired after the 2015 season. Tony Stewart, another 40-something and multiple champion, left Nascar this year. Shockingly, so did Carl Edwards, in his prime and coming off a year in which he came up 10 laps short of a championship.

Dale Earnhardt Jr., the sport's most popular figure, missed much of the 2016 schedule with concussion symptoms. Danica Patrick, the former open-wheeler and only female in the top-level Cup series, has had mediocre results and wound up as part of a nasty lawsuit when her main sponsor severed its agreement with her team, saying it was misled on the value of its Nascar involvement. Both sides sued.

Seven-time champion Jimmie Johnson, the current era's top dog, is nearing the end of his career. It’s the same for former champion Matt Kenseth.

Problems? Perhaps.

But Shell-Pennzoil re-upped their partnership with standout Joey Logano through to 2022 and FedEx made another long-term commitment to Denny Hamlin. So, those major sponsors, which spend as much as $20m per year to support a team, clearly have faith in the new Nascar.

And just like in other sports, new faces come onstage, sometimes in headliner roles. And while not ignoring its veterans, Nascar is heavily promoting the likes of Chase Elliott, Austin Dillon, Erik Jones, Kyle Larson and Mexico's Daniel Suarez. Elliott, Dillon and Larson were in contention at the organisation's Super Bowl, the Daytona 500, until the final lap.

The Next-Gen drivers have become focal points of advertising campaigns, not just for their sponsors – Elliott and Dillon drive iconic cars once piloted by Gordon and Dale Earnhardt – but for the entire sport. New title sponsor Monster Energy, which has made stars out of Supercross and Motocross competitors, recognises the value of the young demographics.

Suarez could be the biggest trailblazer as the first foreign-born driver to win a series title – Xfinity last year – before replacing the prematurely-retired Edwards. The Hispanic fan base provides a huge potential for growth.

Sensing that, communications giant Arris renewed its multi-year sponsorship with Joe Gibbs Racing and will be the primary sponsor for 22 races for Suarez. Arris already was involved with Mexican drivers Fabian Welter and Abraham Calderon in lower series.

“Arris Racing is also proud to play an important role in the development of young Latin American racing talent,” says Ron Coppock, the company’s executive vice-president. “Fabian and Abraham are two drivers who, like a young Daniel Suarez, show great potential on the Mexican racing scene. We are excited to contribute to their growth as drivers and as the next generation of this sport.”

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