Ballpark estimate: $5 million to $35 million to sponsor a single car & driver
When you watch NASCAR racing it’s hard to miss the sponsor’s logos that are prominently displayed on the cars. Most of that money comes from corporations that consider the sponsorships part of their massive advertising budgets. After all, you notice the logos, and so do millions of others watching in person or on television.
What is NASCAR?
Most of you have not only heard of NASCAR for as long as you can remember, but have watched races on television or attended local races near your home. NASCAR has a long and important tradition in the Unites States, with its roots in early stock car racing that became popular after World War II.
Stock car racing was originally created to give drivers the chance to race unmodified cars that had been produced for driving on the street rather than specifically designed as racecars. Soon drivers began to modify the cars somewhat and different rules became common on the man different tracks around the country. Race car driver and organizer Bill France Sr., of Daytona Beach, Florida, convened a group of people involved in stock car racing and they formed the National Association for Stock Car Auto Racing. This organization soon began sanctioning races, producing standards for all races and joining forces with tracks across the country. This led to the first NASCAR-sanctioned race on Feb. 15, 1948 in Daytona Beach.
Since then, the NASCAR circuit has grown into a modern sports empire, today sanctioning over 1,200 races annually in 30 U.S. states, plus in Canada, Mexico, and Europe. NASCAR also helped create the concept of contemporary sports sponsorship, which is now a multi-billion-dollar industry. Growth in the NASCAR fan base throughout the second half of the 20th century is unprecedented. For instance, from 1993 to 1998, at-track attendance for the NASCAR Nextel Series grew 57 percent (this translates into 2.2 million new attendees) to over 6.3 million. During that same time, NASCAR’s top three divisions combined grew a staggering 80 percent (4.1 million new attendees), to over 9.3 million.
Television success was no less staggering. For example, between 1993 and 2002, viewership for the Daytona 500 grew 48 percent (over 6 million new viewers) to 18.7 million viewers. This kind of success has continued into the new millennium and has ensured that NASCAR will continue to be one of the most popular sporting events of our time.
Price Determines Visibility
Although cost for NASCAR sponsorship is probably a bit out of reach for the average American family, businesses are pleased to pay the high prices because of the tremendous number of fans that attend races or watch on television. Think of it, millions of fans who attend the races around the country see the sponsor’s log, plus tens of millions of television viewers at home.
As you might expect the location of the decal on the car determines the cost of the sponsorship. The most expensive spots are reserved for the primary sponsor and costs a cool $35 million per year. According to the NASCAR organization, a primary sponsorship typically includes five placements: the hood of the car, the rear-quarter panel, the deck lid, the TV panel, and the roof panel.
For businesses with smaller advertising budgets, Associate Sponsorships are also available starting at $250,000 for one logo placement in a location that is smaller and less visible than the Primary Sponsorship logos. Some companies negotiate in-kind trades to offset the cost of sponsorship, providing some type of products that the team would otherwise need to purchase such as Valvoline Oil or Craftsman Tools.
Where Does the Money Go?
Money from sponsorships pay for about 60 to 75 percent of the cost to develop and test vehicles, pay for travel expenses, and cover salaries, insurance, and other costs. Race winnings earned and other types of endorsements provide the balance of team expenses.
For example, Sunoco provides all of the fuel used for NASCAR racing vehicles as part of an overall sponsorship negotiated by the NASCAR organization.
Does Winning Matter?
Early in the NASCAR tradition, sponsorship prices depended largely on how well the team performed in races every single week. Today with many new media-outlets available to provide options for visibility and exposure for the team and its sponsor, prices are negotiated based on a complex relationship between the sponsor, team, drivers, and the NASCAR organization. Everyone still wants to win, of course, but winning is not as important to attract sponsorship money as it once was.
Cost to Attend a NASCAR Race
Even if you can’t afford to purchase a $35 Million sponsorship, you can still benefit from the companies that do. While tickets for NASCAR events vary depending on the event and how far in advance you purchase tickets, they are still quite affordable. Some events are priced as low as $15 for a day of qualifying races at the Atlanta Speedway. Fans under 17 years of age are free for that event and eligible for discount tickets for many other events. For a family of four (two adults and two children) to attend the Can-Am 500 at Phoenix International Speedway in Avondale, Arizona, in November of 2016 is $110 total cost. Compared to many sports tickets, that makes NASCAR a very affordable opportunity for a family to attend an exciting event. Not to mention that the weather in Phoenix is pretty nice in November!