As producers, it is your sole intention to compel consumers into wanting what you are selling. How do we make that happen? Marketing. Marketing is the line of communication between producer and consumer. This line of communication has the ability to be manipulated in such various shapes and forms, it is almost impossible for someone to be unapproachable. This line is capable of making you-the consumer, so loyal you would not be able to imagine buying elsewhere. As for marketing in sport, the relationship is one of the many backbones supporting the sport industry. The primary service of marketing in any industry is enticement. Producers entice consumers by utilizing marketing tools, such as sponsorship deals and product placement. The primary purpose of marketing is to be able to create an association between brand and logo amongst consumers. Who in the sport industry utilizes the placement of logos more than anyone? NASCAR. Which is why I decided to analyze the Hendrick Motorsports organization- the dominating team of professional motor sports in America.
Hendrick Motorsports was founded in 1984, by Rick Hendrick. The organization is based out of a 140- acre lot in Concord, North Carolina. The services of the organization include marketing and licensing for its racing teams, as well as retail product in the automotive / automotive parts industry. Hendrick Motorsports represent four full time teams in NASCAR's Sprint Cup Series. Which includes four of the top and highest-paid drivers in NASCAR- Dale Earnhardt Jr., Jimmie Johnson, Chase Elliott, and Kasey Kahne. As of February 2016, the value of Hendrick Motorsports is estimated to be at $375 million, winnings racked up $28 million, revenue brought in $186 million, and the operating income was $22.8million. (Smith et al., 2016; About Rick Hendrick, 2015.)
The most dynamic aspect of marketing for the motor sport industry right now is the recent collaboration between NASCAR and the NCAA at the Battle at Bristol. The football game at Bristol speedway this past weekend, was a huge success and took attendance through the roof, over 150,000 to be exact. You could see the typical college game day being turned into a weekend long event, just as a NASCAR race weekend would be treated with RV's and massive crowds. So much more came out of the game, than just the four quarters of ball played. I think this event really opened up that race weekend atmosphere to college football fans who maybe have never experienced NASCAR, but could now be a little bit more inclined to see what it has in store. This could be a mean a lot for the target markets Hendrick Motorsports takes in to consideration when marketing their drivers, teams, and events. Another hot topic in any aspect of the sport industry is the issue regarding the National Anthem and how players are reacting. However, I don't think sports has seen something more patriotic than the show put on prior to the football game at Bristol. Which honestly says a lot about all entities involved. However, marketing patriotism or Americanism is not a new trend for Hendricks motorsports or NASCAR.
The consumers or buyers targeted by the marketing efforts of Hendrick Motorsports or any team in sport, are fans and potential fans. When marketing to an established fan base, you don't have to truly convince them to watch the race or buy that t-shirt, as you would a potential fan. However, you are enticing them to actually go to the race, buy the season tickets, and buy the “complete fan packages”. When attendances and audiences grow, sponsors want to be a part of it, which means more money for organizations. It's the direct or indirect relationship consumers and producers share with each other. It makes the marketing of the sport industry seem so appealing right? May be appealing, but it is not that easy. Getting into the marketing industry is very, very expensive- making it probably the number one preventer of new entrants. Major corporations have already established their partnerships, sponsorships, and presence in the industry.
Hendrick Motorsports is considered to be the most desirable advertising partnership in sport. Here is why- 1) In 2015, out of the top 20 most viewed events, 17 spots were claimed by NASCAR. 2) The focus of the race is always the drivers, the pit-crews, and the racecars, all of which are completely covered with companies' logos and televised constantly. 3) Not to mention again, that the Hendrick Motorsport Racing Team has THE biggest names in NASCAR. It is no surprise that Hendrick Motorsport has the most valuable line-up of sponsorships in NASCAR. Dale Earnhardt Jr.'s race car is said to be the most valuable piece of “real estate” in NASCAR, from sheer marketing and advertising volume. Just from two sponsors, the 88 car is bringing in $10 million a year from Nationwide Insurance and $30 million a year from The National Guard. That's not including the sponsorships from Farmers Insurance Group, Great Clips, Quicken Loans, Lowes, Mountain Dew, and Kelly Blue Book to name a few. (NASCAR's Marketing Strengths, 2016; Pockrass, 2014)
No matter how successful an organization is or how many billions the industry is worth, there is always room for improvement somewhere. Even though Hendrick Motorsports is worth over $300 million, there are still factors of its marketing plan that could grow. The demographics of NASCAR's fan base is predominately male at 63%, over 90% Caucasian, and close to 50% is over the age of 55. So basically, the fans watching Hendrick's drivers are a bunch of old white men. Surprisingly, more women are represented in the NASCAR fan base, than any of the other professional leagues here in the states. However, that doesn't help much with the fact that NASCAR has the oldest fan base by some strong margins. In my opinion, the most pertinent target market to shift focus on to is young adults, 18-34 years old. The marketing team will be innovative with today's technology to engage a younger fan base. The world of social media- twitter, Instagram, snapchat, etc. is obviously a primary tool that will be utilized. NASCAR is making successful steps and actually set a record for fan engagement on twitter at the 2015 Daytona 500, one of the most popular motor sport races in the world. (Mann, 2014)
Hendrick Motorsports primary consumer market is domestic, so there marketing does not reach much outside of North America. However, the leading competitor in the motorsport industry is Formula One. Formula One has international sponsors, international manufacturers, and markets themselves on a global scale. Formula One has branded itself on the ideas of being exclusive and luxurious. On the other hand, NASCAR has the stereotype of their fans being redneck, country bumpkin, and confederate flag flying, which does affect how Hendrick Motorsports is perceived. Making their marketing team need to keen in on what is needed to remove their brand from this stereotype and will extents are worth be taken when considering global marketing.
I chose to write about marketing and Hendrick Motorsports, because I have always been interested in the idea of working for NASCAR. My father is a huge Dale Earnhardt Jr. fan, so he has races playing on television all the time. I used to live 7 minutes from the Texas Motor Speedway, so I know what the race weekend experience is all about. Sadly, that was about it. I would not have been able to tell you much of anything about the numbers, ratings, or the business side of NASCAR at all. However, after doing this research I am shocked at how much opportunity is there- especially in marketing. Previously, I would have assumed that NASCAR operates in a narrow niche, so they don't have to change marketing much. However, things do change- technology, demographics of fans, competition, etc. I think it would be very interesting to work with NASCAR's marketing team and be a part of getting involved with the younger fan base.
...(download the rest of the essay above)