The goal of this series of articles is to show you how to lay out a template for a marketing program in racing. This article focuses on what I believe to be the most important and vital piece of the motorsports marketing puzzle: developing strategic alliances with your marketing partners.
A strategic alliance is the most valuable part of an effective motorsports marketing program. Why? Because by bringing companies together, you are making yourself valuable to two or more marketing partners and further solidifying your foundation for success. The best example is what recently happened to a NASCAR Winston West team I work with.
This team was contacted by an account executive at a promotions company based in Southern California. This promotions firm represents a company that manufactures and markets a fruit drink. The executive was interested in exploring the potential of developing a team sponsorship within the Winston West series primarily for the Southern California marketplace. He outlined to us that this program would only be a two-race commitment-they wanted to test-market the program this year with the intent of developing a full commitment for the 2001 season.
A series of phone meetings were held to uncover the goals and objectives of the company. What we discovered was that for the racing program to be successful, it had to be multifaceted, and it had to influence the selling process on three levels: distribution, retail, and consumer.
While developing a program to fit the guidelines, I outlined to the client the four-stage Motorsports Marketing Program (Circle Track June 2000). The first stage was to associate the fruit juice company with all facets of the race team. The goal is to build a foundation for the company that the entire motorsports program can build around.
One interesting part of this program was Stage Two: Exposure (Circle Track July 2000). The company was not concerned about the exposure that would be gener-ated from it being on the racetrack. It was focused on developing programs that moved product through the three different selling levels.
So we quickly moved on to Stage Three: Building a Marketing Program (Circle Track August 2000). It was very important to understand the company's goals and objectives so we could design a program geared toward them. In short, the heart of the entire program revolved around a series of contests that affected the three selling levels for the company.
On the distribution level, we discovered that the delivery drivers who brought the product to the retail stores played an important role in how the product was displayed in the store. The drivers influenced store managers to allow them to set up racing-related special point-of-sale materials and product displays. So, to influence the delivery drivers to maximize their selling efforts, we created a contest that awarded the top driver in each territory with a trip to a racing school. The driver that sold the most overall would then receive an all-expense-paid trip for two to the Winston Cup race in Las Vegas.
On the retail level, we had to offer something to the store managers and their district managers. So, we put together a program with three different levels of involvement. The more the store participated with the program (purchasing additional product), the more it received.
For example, if a store was in the first level of additional product, it would receive some point-of-sale displays and be entered into a contest to win tickets to a local racetrack. Store managers that purchase into the second level would be entered into a contest to win an all-expense-paid trip to the Winston Cup race in Las Vegas. Finally, store managers that purchase into the highest level would receive everything plus a show-car appearance and driver autograph session for up to six hours. The driver appearance would also be supported by free ticket giveaways to a local Winston West race in which the driver would compete.
For the district managers, we developed a hospitality program at the racetrack to entertain them and open discussions for future plans and promotions in 2001. The district managers would be entered into a contest as well.
Finally, to draw in the consumer level we put together the "Suite Racing Sweepstakes." This contest was open to anyone visiting a participating retail outlet carrying the fruit drink. Fans could win an all-expenses paid trip for two to Las Vegas for the NASCAR Winston Cup Race. The winner would stay in a suite at a top Las Vegas hotel and enjoy the race from a luxury skybox at the track. The contest was supported by the show car and driver appearance tour, radio commercials, and live remotes along with in-store point-of-sale material and attractive displays.
Based on this program, the company calculated the projected quantity of fruit juice that would have to be sold. The total represents new revenue to the company. Then the company worked backward to figure a percentage of that revenue to be used to fund the two-race sponsorship. So from a return on investment analysis, we all had an idea of what had to be accomplished to make the strategic partnership a success. From the team position, we knew that any result exceeding the company's projections would put us in a good position to negotiate a full marketing program for the 2001 season.
With the plan in place, it was time to work out the details. I began working with the team to identify companies that might like to align with the team and our title sponsor. Because the program had a great deal of impact, we were able to secure a marketing partnership with a top Las Vegas hotel willing to give us two luxury suites for our contest winners. We found a company that wanted its name to be featured on the race car, and in return it gave us 10 passes to its suite at the Las Vegas Motor Speedway. A local racing-themed restaurant gave us some free dinner passes along with some merchandise to offer the contest winners.
All the little side deals dropped the overall budget by $10,000, which the company allowed the team to keep. The race team reallocated this money into the racing budget, which gave them even more money for the two races.
If you recall, I mentioned that this program was a just a two-race test for the sponsoring company. So not only does the race team profit this season, but there also is the chance of securing a major sponsor for next season if all goes well.
In conclusion, I would like to say that at this point you should think about what you have learned so far from these four articles. You also should have a solid understating of your racing property, the exposure associated with your property, and how to build a marketing program around it. It is important to become more familiar with your potential for a strategic alliance. It's getting harder and harder every day to get the big bucks from a single sponsor, but if you can bring two or more sponsors on board, then the money can add up fairly quickly.
To build your own strategic alliance, you should concentrate on contacting companies that do business with other companies that may also be interested in becoming marketing partners with your racing program. But keep in mind that you just cannot call and pitch a motorsports program to the company based on the concept of strategic alliances. You have to be very specific on how a strategic alliance with your racing program can benefit that company. If it feels that you don't know your stuff, you won't get very far. So, stay focused on what your program can offer and how it will affect the company's bottom line. Remember, the more money you can make for them, the more money you are worth.