Maximizing the ROI in Racing
ROI in Racing
When it comes to winning, does it always tie into the ROI in racing? Not necessarily! While sponsors don’t have to retrieve a win on the race track to consider their sponsorship worth their money, it is beneficial to have that. Sponsors of winning teams often see a significant rise in their recognition and product sales. When it comes to business, there are virtually never absolutes, and this is no exception in NASCAR racing! There is not one single or simple answer to the ROI in racing when the NASCAR sponsorship landscape is so broad.
For starters you may be wondering what the term “ROI” stands for. It’s okay – many people don’t know! ROI is a simple acronym for “Return On Investment”. This is simply a measure of performance that is utilized to evaluate the efficiency of investing. On the other hand, it is also used to compare the effectiveness of numerous differing investments. Therefore, ROI in racing is so crucial! Who doesn’t want to know that the money they are investing in NASCAR is making a difference?
If you have been a longtime follower of NASCAR, you may be familiar with the old motto of “Win on Sunday, Sell on Monday. The origin of this saying comes from auto manufacturers. When their brand of race cars made it to that sweet victory lane on Sunday, their showrooms became a much more popular place on Monday. This gave their sales team a higher chance of selling vehicles! For car brands, this is a fantastic ROI in racing.
When a company invests in a sponsorship with a sport, they must create a plan prior to the first day of activation. This is a sure way to be able to measure their investment and objectives. After all, how could a company know if a win impacts their sponsorship if they don’t know what success means for their brand? Without a well thought out plan, it can be impossible to measure what the ROI in racing is for that company after race day.
When a sponsor has a team, does the team need a win to have a good ROI in racing? Is the sponsors success measured by the success of the team itself? The blanket answer is no! It all can depend on what type of activation comes from the sponsorship. Programs are easy to set up to be independent and not reliant on the performance of the team. It’s not difficult to find fascinating examples of how this model works. Back in 2018, Leavine Family Racing never saw victory lane that season. Although they were short of success on the track, their partners achieved extreme success in their sponsorship endeavors overall. Other more popular examples would be both Dumont and Procore, who drove a respectable impact for each of their businesses. These two were both independent and didn’t depend on the results on the track for their ROI in racing!
Although success can happen independent of race results, there are times when sponsorships have a direct tie to performance. An example would be the competitive aspects of sports, which can end up bringing additional attention to specific brands. A favorite and well-known example would be the promotion that Taco Bell serves every year for The World Series. Every time a player steals a base in a World Series game, Taco Bell gives away free tacos on a specific day for every single stolen base. This is “Steal A Base, Steal A Taco”. Driving interest in the sport itself, this is a great example of the ROI in racing sponsorships being directly impacted by performance. In NASCAR, you may see this predicting a race, or even how many wins a certain team achieves!
While successful performances on the track create more opportunities for potential sponsorship in business, it is fair to say that this affects the ROI in racing greatly. After all, teams that achieve more success on the track receive more attention post event! In turn, this provides extra value to the sponsors when it comes to the exposure in the media. On the other side of things, there are sponsors in NASCAR who don’t depend on the success of their team. You can receive exposure in the media without the win! Although it might be substantial for consumer brands, it isn’t quite as crucial for B2B (business-to-business) brands. These types of business have more concern when it comes to the access that they get through the relationship that they have with the team. With these companies, the access to potential consumers outweighs any altitude of value in media exposure.
With the overall objectives of each sponsor determining how their brand’s success is calculated, each business is unique with their own set of benchmarks to consider. The ROI in racing looks different to every company! Wolfpack Racing can guide you in acquiring accurate information that better equips your business to select the appropriate NASCAR sponsor for your brand. Identifying the right partner is crucial to drive a brand forward. So, what goals do you have?