How much is a Title Sponsor worth to the ICS?

[!!WALDO!!]

I know people will hate this but here are some facts.

PPG paid CART $8,000,000 with $4,000,000 going to the Pace Car Program, $3,000,000 to the Point Fund and $1,000,000 for 15 races.(Source Simon Whitepaper of 1994)

Pep Boys/Northern Lights paid around $10,000,000

FedEx Paid $10,000,000 with $6,000,000 in Transportation, $3,000,000 points and $1,000,000 for scheduled races.

Recently Busch left NASCAR after paying $10,000,000 a year. NASCAR wanted $40,000,000 for the 36 races and settled with Nationwide for around $10,000,000.

So based on rating, attendance per race, these series are about the same with the exception of one race.

So based on my 23 races, $6,000,000 for 22 races and $3,000,000 for 1 or $9,000,000 total.

$3,000,000 for Points, $3,000,000 for 500 purse, $3,000,000 for 22 races.


Any ideas on how to get the amount up?
Is $9,000,000 even worth it?

[DBell]

Well, that's 9 mil that wouldn't have to come out of TG's pocket. Beggars can't be choosers and AOW is pretty much in a begging position.

If a company could be found and they were to sign a 4-5 year deal, performance clauses could be put in based on attendance and TV ratings that would escalate the payout if met.

[dataman1]

Since there has been an absence of series title sponsors, if I were in charge I would look at a brand I wanted the series to identify with then go after them. If I can get say 6 million the first year great. Then pump them for more each year as the series grows in popularity with the fans and TV viewership. IMO Something will have to change in the product offered on the track or the way it is marketed and promoted to see series growth or it will never reach 10million again.

[indycool]

I would think the ICS would deal with corporate entities with some interest to watch 2008 evolve with the idea of jumping aboard in 2009, given the circumstances. But, I suppose, there could be a "get it while it's hot" series melding strategy.

[!!WALDO!!]

Since there has been an absence of series title sponsors, if I were in charge I would look at a brand I wanted the series to identify with then go after them. If I can get say 6 million the first year great. Then pump them for more each year as the series grows in popularity with the fans and TV viewership. IMO Something will have to change in the product offered on the track or the way it is marketed and promoted to see series growth or it will never reach 10million again.


There is a way to market a product but neither the IRL/CCWS/CART ever were interested in it. One of the reasons PPG did the pace car program, they got the marketing done themselves.

[veeten]

One of the reasons PPG did the pace car program, they got the marketing done themselves.

not to mention that many of those cars did dual roles as design ideas for manufacturers, and some as vehicles in movies. One example was the Chrysler M4S, which was not only a pace car but was also the star of a B-movie, "The Wraith". :)

[weeflyonthewall]

I know people will hate this but here are some facts.

PPG paid CART $8,000,000 with $4,000,000 going to the Pace Car Program, $3,000,000 to the Point Fund and $1,000,000 for 15 races.(Source Simon Whitepaper of 1994)

Pep Boys/Northern Lights paid around $10,000,000

FedEx Paid $10,000,000 with $6,000,000 in Transportation, $3,000,000 points and $1,000,000 for scheduled races.

Recently Busch left NASCAR after paying $10,000,000 a year. NASCAR wanted $40,000,000 for the 36 races and settled with Nationwide for around $10,000,000.

So based on rating, attendance per race, these series are about the same with the exception of one race.

So based on my 23 races, $6,000,000 for 22 races and $3,000,000 for 1 or $9,000,000 total.

$3,000,000 for Points, $3,000,000 for 500 purse, $3,000,000 for 22 races.


Any ideas on how to get the amount up?
Is $9,000,000 even worth it?

Didn't title sponsorship lose its value when TG started the team sponsorship subsidy program? At least CC was building from the ground up with solid series associates and contingency awards.TG has tried to copy the model but the damage he caused is gonna take time to heal.

[veeten]

actually, it's better for the team sponsorships to be the main thrust at present. There were way too many cars without proper sponsors, basically those teams using themselves as the name on the car rather than a real company or product.

Sorry, weefly, but the sponsorship model that CC was running was the very thing that became a sinking anchor for the series. Bridgestone and Ford could only do but so much, and even then Ford pulled stakes as of last year, handing it over to their subsidiary, Mazda.

Also, teams in CC were told that they would no longer recieve funds to pay for the equipment and cars, just as the DP01 was being released. It's understandable how a good number of former CC teams are in a quandry about their financial state, having to change chassis after buying the other ones a year ago. And without stable, transferable sponsors that the publc recognize, it's an absolute nightmare.

Reasons as to why it's best to do the teams first, then a series' sponsor after.

[!!WALDO!!]

First off from 1981 until the IPO, CART was funding itself through the car owners. $250,000 per car would be paid to Troy, MI and you got a vote, maximum of two if two cars. Then you would receive back $25,000 per race.
Penske in 1994 had a three team effort, Emmo, Paul and Al. Roger paid, $750,000 and got 2 votes. He got $25,000 per car back for Emmo and Paul, nothing for Al. Al won the most money though.
That is why you had Dick Simon's Simin racing and Dianne Simon's Paragon racing, that gave them 4 votes and $100,000 per race in subsidies.

Also, 20% of the total SEASON sponsorship you got went back to CART. This money was used, about 20% to fund the subsidy program, to support races (those horrible free Marlboro tickets) 60% and support the day to day operations.
This is also why some teams went to "RIDE BUYERS" as they were race to race and not SEASON.


See $4,000,000 in real cash, $6,500,000 from the owners, $12,000,000 in Sponsorship (20%) and $7,500,000 from suppliers gave CART around $30,000,000 for their 15 races. TV money that started in earnest in 1993, at $13,000,000 thanks to "Indy Car" and Tony George was only 20% to the track and 80% to CART unless the race was promoted by a CART member then it became 80% to the race and 20% to CART.

CART had $7,725,000 in purses to pay out, $9,370,000 in subsidies, $3,000,000 in point funds plus $3,000,000 in Indy Lites. That was $23,100,000 and with insurance, operations, office and promotion the deal got very close, within $450,000 of the $30,000,000.

So CART would ask for $2,800,000 and have $1,970,000 covered leaving the promoter a cost of $830,000 plus an event sponsor with the help of CART of a net of $330,000. (More free tickets)

So in 1993 a Portland would pay CART $500,000 and get back $175,000 in TV money. NET COST of $325,000
A Milwaukee (promoted by Haas) would pay CART $500,000 and get back $690,000 in TV money. NET COST of ($190,000)

CART would take about $70,000 in the Event Sponsorship per race if outside of CART, i.e. G.I. Joe. This brought in around $490,000 plus $8,883,000 in TV revenue or a a total of $10,000,000 with an ending subsidy of $120,000 per voting member, and $50,000 per non-voting member or $3,150,000.

So after taxes about $3,750,000 million was put in the bank. Over the years from 1981-1997 they ended up with close to $70,000,000 in the bank.

The IRL is running on the same basic formula except the Car Owners do not have to ante-up.

Remember also that from 1993 on the CART purse was $515,000 and only the top 12 got that. $60,000 to win, $2,500 for 12th so that $25,000 came in handy. So a team scoring points in 15 races maybe got $200,000 plus $375,000 in subsidies, plus point money $300,000, and year ending $120,000. So $970,000 plus 500 money. This for a racing budget on that one car of $8,000,000.

(NSSN:1981-1998. Simon CART issued White Paper. Research done by 12 people in 1993, myself included, CART.com)

[Lousada]

Interesting post thank you :up:
Am I right in thinking that this was not a good proposition if you were not part of the voting CART teams, or if you tried to organise a race without a CART member? The way I read this is that the 'outside' teams and promotors, are funding the 'inside' members?

[Jag_Warrior]

Waldo, that was one of the most data filled posts I have ever seen on this, or any board. Bravo! I just accept your numbers as they are. From what I know, they certainly should be close, if not dead on, to how it was.

I have a question for you. For several years through the 90's, the company that I worked for was a major associate sponsor on a front running CART team. We supported the owner in other series besides PPG/FedEx too. But in the main series, we paid approximately $1 million per car per season. The last year that we were involved, I was told that the primary paid something north of $4 million, plus other promotional and B2B benefits for the team. And there was a whole gaggle of other associates involved. So I can take your series and team figures, add up what the team got from sponsorships, compare it to known and estimated costs... and see how this was a money making enterprise. Let's take something that works relatively well and then shoot it in the head! Yes, brilliant thinking.

My question is, with the much decreased ratings and sponsor exposure values that we now see, and with costs being much the same as before, outside of subsidies, how do these mid-pack and lower sponsorless (or fantasy sponsored) teams find enough air to breathe? Or have I answered my own question... they don't?

Your original question is also interesting. On the Busch/Nationwide comparison, I can only relate what I saw as I was leaving the company I worked for. The decision was made to abandon the IRL team that one division was sponsoring and apply that money to a Busch ride. Why? The loose association with NASCAR's top series, and a certain famous driver, was seen as having more value (for about the same money) than sponsoring the open wheel car with the unknown driver.

IMO, especially in these troubled times, if the IRL can get within a million $ of what the Busch/Nationwide series is getting... better snag that check and run to the bank.

[!!WALDO!!]

Waldo, that was one of the most data filled posts I have ever seen on this, or any board. Bravo! I just accept your numbers as they are. From what I know, they certainly should be close, if not dead on, to how it was.

I have a question for you. For several years through the 90's, the company that I worked for was a major associate sponsor on a front running CART team. We supported the owner in other series besides PPG/FedEx too. But in the main series, we paid approximately $1 million per car per season. The last year that we were involved, I was told that the primary paid something north of $4 million, plus other promotional and B2B benefits for the team. And there was a whole gaggle of other associates involved. So I can take your series and team figures, add up what the team got from sponsorships, compare it to known and estimated costs... and see how this was a money making enterprise. Let's take something that works relatively well and then shoot it in the head! Yes, brilliant thinking.

My question is, with the much decreased ratings and sponsor exposure values that we now see, and with costs being much the same as before, outside of subsidies, how do these mid-pack and lower sponsorless (or fantasy sponsored) teams find enough air to breathe? Or have I answered my own question... they don't?

Your original question is also interesting. On the Busch/Nationwide comparison, I can only relate what I saw as I was leaving the company I worked for. The decision was made to abandon the IRL team that one division was sponsoring and apply that money to a Busch ride. Why? The loose association with NASCAR's top series, and a certain famous driver, was seen as having more value (for about the same money) than sponsoring the open wheel car with the unknown driver.

IMO, especially in these troubled times, if the IRL can get within a million $ of what the Busch/Nationwide series is getting... better snag that check and run to the bank.

Thank you and Lousada.

Why do you think TG is now adding a "subsidy" program like CART had? This problem goes back to a post in 1999 I made where "the Cruise Ship has sailed and is over the horizon and a bunch of people are 10 miles inland whispering for the ship to come back"
The situation became bad once riding buying became the norm with half the teams rather than the rarity. The pressure that was brought to bear on the CART teams in 1995 and 1996 and the owners thumbing their noses at the fact that 65% of their sponsorship came from one race. Once those contracts ran their course most were gone and others force owners hands, like Floyd and Roger. Those sponsors are long gone from the sport and not interested in returning. The Grand Scheme was "we will treat these guys bad and just get others to replace them." Too bad there is communications.

No the situation is terminal and has been since about 1993 but too many have become aware of this in 2005. If we could have cured the cancer in the weeks after discovery the patient has a good chance, find it in Stage 18, go home!

I have been telling people this for years but it always falls on blind eyes. THANK YOU for reading and actually understanding the info that many people started digging into in 1988.

Waldo :)

[!!WALDO!!]

Interesting post thank you :up:
Am I right in thinking that this was not a good proposition if you were not part of the voting CART teams, or if you tried to organise a race without a CART member? The way I read this is that the 'outside' teams and promotors, are funding the 'inside' members?


Yes, but in 1995 Pat Patrick wasn't a member and Gerry Forsythe only joined in 1997 after being in CART from 1981.

[Jag_Warrior]

It's good to see posts like yours, Waldo, because it offers a deeper perspective, that few could have, since most don't have access to that level of information. There used to be a few fellows who posted here who worked for TRD, Ilmor, Cosworth and various sponsors. In PM's, they'd often tell you something, but usually only if you told them something in return. It was understandable, since they were at risk and they wanted some info from you, so the risk was shared. Once they saw that you could be trusted with a secret, they'd drop you a line if something big was about to happen.

There was a fellow on CCF who knew where a lot of skeletons were hidden as well. Unlike most there, he really didn't seem to have an agenda. But like the ones who used to post here, he seems to have disappeared too. My guess is you two probably knew each other at some point or in some capacity.

Other than rich dudes playing the semi-pro club racing game, I still don't see what the brave new world holds for AOWR. I guess time will tell.

[!!WALDO!!]

It's good to see posts like yours, Waldo, because it offers a deeper perspective, that few could have, since most don't have access to that level of information. There used to be a few fellows who posted here who worked for TRD, Ilmor, Cosworth and various sponsors. In PM's, they'd often tell you something, but usually only if you told them something in return. It was understandable, since they were at risk and they wanted some info from you, so the risk was shared. Once they saw that you could be trusted with a secret, they'd drop you a line if something big was about to happen.

There was a fellow on CCF who knew where a lot of skeletons were hidden as well. Unlike most there, he really didn't seem to have an agenda. But like the ones who used to post here, he seems to have disappeared too. My guess is you two probably knew each other at some point or in some capacity.

Other than rich dudes playing the semi-pro club racing game, I still don't see what the brave new world holds for AOWR. I guess time will tell.

I got a bit blistering PM yesterday from some one born on November 30th, there are three of those you know, no year. He claimed that I was an IRL fan and that he is now on the path to the ALMS. I pointed out that my 69 USAC Races, 78 CART races and 16 IRL races made me what?
I have been attacked by the way I post. Who doesn't like it? Fans that "learned it differently than I did." Well, if you learned it wrong, does it make it right that you actually learned it?
Some of us come with no agenda other than "truth" and "getting it right". I have spent my life as a historian of many different things and I do have a photographic memory and people on forums hate it.
One time a CART fanatic was talking about being at Terre Haute for a USAC Sprint car race, but he didn't remember the year. So he gave some details and I was able to tell him it was 1964 on Father's Day. He thought it was at night but I was involved in the 1st night deal in 1993 so that was cleared up. I told him Johnny White, the 500 RoY was critically injured going over the turn two wall, Foyt won it in the #2 Pearl/Red/Blue and Gold Leaf car and told him many of the cars that were there including a rare race by Lloyd Ruby in the Maroon #36.
He was totally impressed and asked me where did I sit? I told him "I wasn't there." I had seen two pages of Racing Pictorial in late 1964 that had 8 pictures in color, plus the story had been covered. (I did not give him details of my knowledge)
You would have thought I called him a horrible name. He and his buddies flooded the PM box of the Administrator until one afternoon for no reason I was banned. He was upset that he was there, a year or two older than me and I wasn't but I knew more than him.
My point is "so". A teacher teaches students that know not very much about the subject. I have been with people that watch the baseball game but are asking me what is going on because I am scoring it. Same thing with the Michigan 500s, there were those wanting to know where everyone was at as I was scoring the race in my head and putting down notes.

There are those with a deep rooted agenda but I have none and will have none except to "get it right." History is like math there is only one answer. History is not subject to the opinions of others. I love this one as it is the lamest opinion but because it is, nobody questions it. If they do then they realize that their opinions are not based on "facts'.
The Japanese would never of attacked Pearl Harbor if we hadn't nuked Hiroshima.
I have used this for 3 years and never been challenged except "no politics please". I used this for those convinced 25/8 locked out the CART teams when April 4th, 1995 CART changed their Chassis rules (FORMULA) and July 7th, 1995 TG announce 25/8.
Talk about 2 miles over their heads.

Yes, I have had 1000s of PM and back channels with employees, car owners, drivers, reporters, officials and historians. Let alone my own personal involvement and even risking money. Go to Sarah Fisher and ask her who gave her the $3000 she won at the Wolverine Mid-Season National in 1999 at Kalamazoo, MI she will give you my real name.
I have vast experience and I say sometimes I have forgotten more than many knew. Another tipping of the e-hive but it is true. I spend an hour a day trying to being back memories and learn something new. I stay away from the internet because it is loaded with those with opinions and everyone is entitled to their opinions but not their version of the facts.

You are right as we are hanging on the whims of the rich. In my day you would see a dirt car show up at Milwaukee on an open trailer being towed by a station wagon with the car owner, driver and stooge. There would be a small tool box, a right front tire and a right rear tire and box of rags. They would unload it, wipe it down and practice. Take out a tool and adjust the shocks and the stearing a bit and go out and qualify. He is 18th out of 34 that showed up. Sets 15th fastest time and hangs on to be 19th out of the 20 that qualified. Another set of adjustments and it is race time and he runs all day ends up 11th 6 laps down and gets a check for $333.33. They load up the car, look at the weather, climb in and head back to Indy. Little later you will see them in a place that says "EATS" spending some of that $333.33 on a hunk of meat, a cold one and re-live that day to the memories of the car owner and stooge, the driver doesn't remember a thing except he ate here after last years Mays race.

:)