BUSINESS

NASCAR's Daytona 500: Cash-Crunched Sponsors Reluctant To Pay Teams For Entire Season

02/24/2012 09:18 am ET | Updated Mar 02, 2012

Any sport that stages its Super Bowl at the start of its official season deserves attention. But NASCAR's Daytona 500 on Sunday could still be mighty hard to follow for some casual auto-racing fans.

Recession-bitten sponsors are reluctant to pay racing teams for the entire season, so many drivers are now competing with rotating ads and paint jobs on their cars, USA Today reports. The trend could be driving fans away because the changing designs make it harder to recognize the drivers.

"Absolutely, I think it hurts," NASCAR chief marketing officer Steve Phelps told the paper. "A casual fan watches a race with a car number and paint (scheme) with a particular sponsor, and they watch the next race, and it's a different color."

Even many non-racing folk could recognize Richard Petty for his No. 43 blue and red STP car back in the day. Same with the late Dale Earnhardt, whose black No. 3 car emblazoned with Goodwrench became an icon during NASCAR's mainstream emergence.

For NASCAR's part, the industry has been quick to promote recent sponsorship deals as an indication of a larger economic rebound. But Phelps has made it clear in the past that NASCAR considers the economy not only in the context of its sponsors, but in terms of its potentially struggling fans too.

"With unemployment at high and stubborn, we have to make the race fan feel good about the return that they are getting for their dollar [sic]," Phelps told Minyanville last September. "The fan experience is very important to us. And this focus is showing up in our ratings, which are up year over year across the board."

That subsequent weak consumer spending in mind, companies have had to turn to less conventional tactics to survive, Ben Schlosser, the chief marketing officer for Richard Childress Racing, told USA Today in a separate report.

"Companies have gotten smarter in the downturn, doing more with less," he said. "The complexity has gone up, but financially, it's the way that we make it work."

But race car driving isn't the only sport that's been hurt by a dip in sponsorship dollars. In 2009, during the height of the recession, North American companies scaled way back on sponsorship spending for sports, arts and entertainment, according to a January 2009 Reuters report.

Godwin Kelly, motorsports editor for the Daytona Beach News-Journal, noted the NASCAR pattern last season and called the piecemeal advertising deals "unsettling." Sponsors used to fork over between $15 million to $20 million at NASCAR's peak, the USA Today article noted. Not anymore.

Kelly also mentioned the empty grandstand seats and low-octane TV ratings for a while. But Nascar is apparently rebounding. Propped up by a $4.5 billion deal it struck in 2005 with Fox, ESPN and Turner Sports, it increased TV viewership in 2011 after losing a quarter of its audience between 2006 and 2010.

Now NASCAR needs to make sure even its less-ardent fans know who's driving in what car.

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