Friday, August 08, 2014

Good News, Bad News On Hendrick Sponsor Front

The National Guard announced this week that will withdraw its sponsorship of Hendrick Motorsports and Dale Earnhardt Jr., at the end of this season.

The Guard spent a total of $44 million on motorsports sponsorships this year; $32 million on Earnhardt and an additional $12 million on Graham Rahal’s IndyCar Series program. Both sponsorships will reportedly end, based on what Army Guard acting director Maj. Gen. Judd H. Lyons called, "Significantly constrained resources and the likelihood of further reductions in the future.”

The Guard’s involvement with motorsports has come under repeated fire in recent years, led primarily by Democratic Congresswomen Betty McCollum of Minnesota, who unsuccessfully introduced multiple resolutions calling for the sponsorships to be cut from the Pentagon budget. Recently, lawmakers met to examine 2015 military appropriations and expenditures, culminating in the National Guard’s decision to withdraw from the sport.

“We need to measure the effectiveness of whatever dollars we do spend,” said Republican Senator Ron Johnson of Wisconsin. “This is one that I think should really get the caution flag.”

The National Guard sponsored Earnhardt in 20 races this season, with additional backing from Nationwide Insurance (12 races), Pepsi (five races) and Kelley Blue Book (one race). The Guard’s NASCAR expenditure accounted for approximately 27 percent of its overall marketing budget.

Not everyone is happy with the decision to withdraw, however. Army Guard marketing director Lt. Col. Christian Johnson said this week, "Motorsports partnerships — including NASCAR — played an important role in helping the National Guard build strong brand awareness and in turn helped us achieve extraordinary recruiting and end-strength objectives over the past decade. Our NASCAR sponsorship was principally a marketing program, intended primarily to build awareness of the National Guard as a career option. The NASCAR sponsorship allowed the National Guard to leverage a 77 million fan base and the sport's most popular driver."

The Guard has also been criticized in the aftermath of a 2013 study that attributed no actual recruits to its NASCAR programs. That same study, however, showed that 90 percent of enlistees since 2007 said they became aware of the Guard through its NASCAR sponsorship.

A recent Joyce Julius and Associates report showed that Earnhardt has garnered $27.8 million in television exposure for the National Guard this season, even before claiming his third win of the year at Pocono Raceway last Sunday. That figure is up from $22.6 million for all of 2013.

Interestingly, Hendrick Motorsports said their current contract with the Guard includes the 2015 season.

“Our team has a contract in place to continue the National Guard program at its current level in 2015,” said a statement from the team. “We have not been approached by the Guard about potential changes and plan to honor our current agreement.”
Not all of this week’s Hendrick s sponsorship news has been bad.
Today, AARP and its Drive to End Hunger program announced that they will return in 2015 as a primary sponsor of Jeff Gordon and his No. 24 team. AARP Foundation’s Drive to End Hunger program will be featured as a primary partner in 13 Sprint Cup races next season, including the Daytona 500, and as an associate sponsor in all other events. The 2015 campaign will mark AARP’s fifth year as a primary sponsor of the team.
“Hunger is a hidden problem that millions of older Americans are battling silently. We are excited to keep building on the great work of these last four years to help the nearly nine million older Americans who face the threat of hunger,” said Lisa Marsh Ryerson, AARP Foundation president. “With Jeff Gordon and Rick Hendrick, we have committed champions behind the wheel on and off the track. Together we will make the most of this unprecedented opportunity to end the struggle that so many older Americans have with hunger.”
“NASCAR fans have been such a big part of the success of Drive to End Hunger, and we’re really grateful for that,” said Gordon. “I’ve seen them packing meals, texting donations and getting involved in their communities. AARP and AARP Foundation are incredible partners to be involved with, and I’m very happy to continue our work together. It’s been an extremely rewarding and humbling experience for me personally.”


  1. Anonymous10:51 PM

    The way I see it, HMS needing sponsorship is bad news for everyone else looking for sponsorship.

  2. Anonymous12:14 PM

    If hunger is the great problem Why is the money being spent on racing?

    1. A quick primer on sponsorship/advertising:

      A entity will spend, lets say, $10 million to sponsor a race team in the hopes that they get more than their investment back in return. If not, they'll find somewhere else to spend their advertising dollars. Apparently, the AARP/Hendrick/Gordon relationship is getting it done. This all assumes that you believe in the principle of advertising.

    2. Anonymous10:00 PM

      Because no matter what cause an organization is trying to get the word out for, promotion costs money. And somewhere, some accountant for AARP discovered they can reach out to more people on more occasions, as well as receiving free cross promotional advertising (seeing AARP on the fender in a Pepsi commercial) than any other form of advertising. That is the beauty of NASCAR sponsorships.