Verizon commits to strong presence in NASCAR
By Michael Smith - Special to the Sporting News NASCAR Wire Service
Tuesday, February 17, 2009
Verizon is sponsoring the No. 12 Penske Racing Dodge of Justin Allgaier in the NASCAR Nationwide Series.
David Griffin
NASCAR Scene
Verizon Wireless went to the Daytona 500 last week knowing the speedway was off limits, so it set out to capture the rest of the town.
Sprint’s title sponsorship of NASCAR’s top series doesn’t leave a lot of room for its competitors, but Verizon, which is assuming Alltel’s sponsorship at Penske Racing, was intent on putting its marks in NASCAR for the first time, both around Daytona Beach and through the Fox broadcast.
A dozen branded Smart cars, wrapped like Verizon’s Nationwide Series car, toured Daytona Beach’s hot spots, distributing flyers and carrying street teams into crowded areas to mingle with fans. A popular oceanfront night spot, the Ocean Deck, was rebranded into the V Lounge for four days. There, the goal was to put Verizon products in the hands of consumers to experience mobile content on V-Cast.
Verizon’s retail store, conveniently located across the street from the speedway, was the site for driver autograph signings and show cars. “Lots of interaction,” explained Lou Rossi, director of media and sponsorships for Verizon Wireless.
Verizon combined these about-town activities with a heavy ad spend on Fox and Speed, including an in-car camera buy that showed the Verizon mark whenever Penske Racing's Sprint Cup driver, David Stremme, was featured in a shot during the non-points Budweiser Shootout.
“Our goal is to make sure everyone knows that we’re involved with NASCAR and that we’re here to support the sport,” Rossi said. “Daytona is about establishing ourselves and making sure the fans know what Verizon brings to the table.”
Because of Sprint’s exclusivity in the Cup series, the only way for Verizon to rebrand the Alltel car was to drop down from the Sprint Cup to the Nationwide Series. Verizon closed its $28 billion acquisition of Alltel last month and it will begin to phase out the Alltel brand this year.
But a sponsorship in NASCAR’s second tier didn’t mean Verizon would throw second-tier resources against it, especially in a wireless category known for its deep pockets. Some analysts said Verizon might be wrapped on a Nationwide Series car, but its marketing and advertising have the feel of a Cup sponsorship.
Industry analysts say that Nationwide Series sponsorships typically go for $4 million to $5 million a year and Verizon’s activation is expected to be two to three times more, giving it the big splash it sought as a newcomer in the sport.
“You can have big, Cup-like awareness out of the Nationwide Series. It’s a matter of combining clever with the appropriate spend,” said Zak Brown, CEO of motorsports marketing agency Just Marketing International, which is combining forces with Marketing Werks, Chicago, on Verizon’s NASCAR activation. “A lot of Nationwide sponsors don’t spend as much activating as they should. They see Saturday as their day to market and they shut it down Sunday.
“Verizon is saying, ‘We’re here.’ ”
When asked if Sprint’s title sponsorship made it tougher to activate, Rossi said, “No. Certainly with one of our main competitors in there, you’re going to have distractions, but we’ll stay our course.”
For its part, Sprint does not have any problems with Verizon activating its Nationwide program, no matter how heavy that activation might be. Sprint’s category exclusivity extends to Cup cars and speedways that are the site for Cup races, which includes most Nationwide events. Verizon, as well as AT&T and other competitors, are free to spend at will on NASCAR’s TV broadcasts and they normally do.
“As long as they do not infringe upon our exclusive rights, then it is business as usual for us,” said Steve Gaffney, director of sports and entertainment marketing at Sprint. Big spending comes with the territory in the wireless world. In 2007, three of the top six spenders in sports advertising were No. 3 AT&T, No. 5 Verizon and No. 6 Sprint, according to Nielsen Monitor-Plus. (The 2008 numbers are not expected until next month.)
Wireless competitors in NASCAR don’t have a history of playing nice. AT&T found itself in a position similar to Verizon’s two years ago when it acquired Cingular and attempted to rebrand Jeff Burton’s Sprint Cup car. The case wound up in court, with AT&T taking a stand against NASCAR and Sprint. The two sides settled and AT&T eventually exited the sport, deciding a move to the Nationwide Series would not play well after racing for the Sprint Cup title.
Verizon’s tack has been to play nice and use the resources it has to create its own presence. That includes NASCAR, IndyCar Series and Grand Am sports car sponsorships at Penske, all of which live under the recently created Verizon Championship Racing umbrella. Mobile content offerings are being considered.
“Verizon’s program is much deeper than a Nationwide Series sponsorship,” said Jonathan Gibson, Penske’s vice president of marketing. “They’ve been smart and strategic to develop a platform, from a marketing standpoint, that will give them a much broader reach and allow them to communicate with a larger group of fans.”
Verizon’s entry puts even more pressure on Sprint’s marketing in the NASCAR space. Sprint says its activation and advertising spend will equal or surpass the 2008 levels, even though it recently announced that 8,000 job cuts are coming. Sprint’s $75 million-a-year deal with NASCAR includes some built in activation and advertising commitments, but the company says it annually spends in excess of that.
“The wireless industry as a whole is ultra-competitive and noisy, primarily because of the immense media weight that’s spent across the category,” said Scott Becher of Florida-based Sports and Sponsorships Inc. “If Sprint activates boldly, its competitors likely become background static. Without compelling activation, though, sponsors basically invite their competitors to crash the party.”
Michael Smith is a reporter with SportsBusiness Journal.
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8 responses to "Verizon commits to strong presence in NASCAR". Post a Comment.
terry ruth said:
Feb 17, 2009 at 1:50 PMI JUST HOPE PENSKE OVERCHARGES THEM AND MAKES THEM SIGN A 2 YEAR CONTRACT. SORRY JUSTIN WE LOSE THE SIGNAL IN TURN 3.....
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» Confirm Abuse ReportPat Draper said:
Feb 17, 2009 at 3:35 PMWhats the big deal with Verizon and why can't all the cell phone companys play nice. Of all that were mentioned in this aricle i don't use any of them and probably never will. They could write it in the sky and i wouldn't change. Just because my favorite driver has a certain sponsor doesn't mean i'm going to use that product. Nascar should be glad to have all the sponsors they can get. I thought it was rotten when AT&T had to leave what on earth is the matter with Nascar. A sponsor is a sponsor be glad you've got them.
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» Confirm Abuse ReportJozef Colomy said:
Feb 17, 2009 at 4:06 PMThe fact that NASCAR itself is running potential team sponsors out of the sport, or certain series, is ridiculous. Not only with Alltel/Verizon, but also with Cingular/AT&T, Camping World in the truck series, Kobalt Tools in the truck series for awhile, Geico and Allstate in the now-Nationwide series...it's ridiculous and the teams are the ones suffering as a result while NASCAR's pockets fatten up.
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» Confirm Abuse ReportJerry Ross said:
Feb 17, 2009 at 5:56 PMIthink that NASCAR should look at their sponsors before signing a long contract for a series. It is not good business practices for all the teams.
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» Confirm Abuse ReportJill Dieter said:
Feb 17, 2009 at 9:42 PMSprint doesn't want competition. Sponsors are needed and Verizon and AT & T would sponsor a car for the season. Shutting out the other phone companies won't help sprint. Now that Nationwide is the new "Busch" Geico can't be on a car. I think they are a great sponsosr. The teams need sponsors but these series refuse to have competition. I thought racing was competitive.
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» Confirm Abuse ReportCliff Cherry said:
Feb 18, 2009 at 12:49 AM[quote]Just because my favorite driver has a certain sponsor doesn't mean i'm going to use that product[/quote]Uh, then why should any company spend any money at all if that's going to be the prevailing attitude? Sorry Pat, your favorite driver's sponsor doesn't give your team millions of dollars just for the pure joy of seeing their name buzz around really really fast :-\ As for Verizon, I applaud their marketing efforts to "get around" Sprint's exclusivity, and I have no problem with Sprint's exclusivity in the first place.
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» Confirm Abuse Reportjimmie grimm said:
Feb 18, 2009 at 3:53 AMthey need sponcers, nascar needs to pull their head out of their /////
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» Confirm Abuse ReportGrandma Sharon said:
Feb 18, 2009 at 1:04 PMIf NASCAR truly wanted to do right by the sport, fans, and teams they would never agree to a contract of any kind that was title sponsor exclusive. To me it does not make the title sponsors look good if they are so afraid of a little competition like team sponsorship. Racing is total competition, they need to get with the program.
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