The Race for More Sales: Motorsports Involvement by the Manufacturers Isn’t Enough

Sept. 12, 2016

 Tire manufacturers spend a tremendous amount of money annually on all sorts of motorsports activities. It would be a safe bet to say they believe they are getting great returns on their investments in addition to any technological advancements.

Whether it is grassroots, NASCAR or Formula 1 racing, the racing series’ marketing teams have put together presentations outlining what companies should expect from their sponsorship dollars. I’m also sure that, at least when it comes to the higher level series, companies are being shown various forms of marketing research to justify their expenditures.

But, I often wonder in an industry where the products are sold, not bought, just how much does motorsports involvement really matter in terms of sales and branding?

On the positive side, racing is high-energy entertainment. You don’t have to love racing to appreciate how much the adrenaline gets pumping when high-powered racing machines fire up in front of a large crowd filling the air with magic.

In most series, the racing teams must buy/lease the tires, so that offsets some of the revenue spent on sponsorship rights. Television exposure usually (more on this in a moment) is positive, followed by the Monday morning press release about the winner using XYZ brand of tire.

In the few racing series where there is actual competition among brands, this “winning” theme is important. A few years ago, a Michelin executive said his company did not want to compete in Formula 1 if it became a single tire (spec) series. F1 became a spec series and Michelin left and now competes in some competitive brand series.

Paul Hembery, Pirelli & Cie SpA’s global motorsports director, explained the pros and cons of being in a competitive tire series versus a spec tire series in our December 2015 issue.

One of his “cons” adds to the confusion of how important racing is to a tire company. In an open competition, “even when you are on the winning car, it’s hard to persuade the public that you’ve made an active contribution to the winner. When somebody wins, it’s the car and the driver. When they lose, it’s the fault of the tire.”

Now, to my point about television exposure. More than once I’ve heard drivers complain bitterly about the poor performance of the tires on their cars. In fact, one of the better-known racing series issued an order to its teams to have their drivers quit complaining about the tires or face penalties. Just how does this help branding?

According to the Statistic Brain Research Institute, there are 70 million NASCAR fans (2013 was the last year statistics could be verified). NASCAR always brags that it has the most brand-loyal fans, bar none. So, if all of those 70 million fans bought at least one set of Goodyear tires (the spec tire brand for NASCAR) once every five years, Goodyear Tire & Rubber Co. would sell at least 56 million tires in the U.S. annually. But it’s not that straightforward.

Based on the Goodyear brand’s market share in the U.S. in 2015, the company actually sold closer to 26 million Goodyear passenger tires. And to sell that many tires, Goodyear invested in many other forms of marketing and advertising programs, such as its Blimp fleet and exposure at many different types of sporting and non-sporting events.

So racing alone, despite its long-term popularity, is not the key to selling tires. Neither is the consumer. As we all know by now, independent tire dealers determine the tire brand that the customer buys at least 70% of the time. You are the key.

Even more compelling are the results from our 2016 Business Supplier Survey. On a scale of 1 (not important at all) to 5 (very important), you rated the importance of a tire brand’s motorsports activities in deciding whether or not to do business with a tire supplier at 2.2.

What does all this tell us? In my mind it means that the trust in the dealer trumps racing zeal. If you take advantage of your supplier’s racing sponsorship, then “race on Sunday, sell on Monday” will ring true.  

If you have any questions or comments, please email me at [email protected].

To see more of Bob Ulrich's editorials, click:

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About the Author

Bob Ulrich

Bob Ulrich was named Modern Tire Dealer editor in August 2000 and retired in January 2020. He joined the magazine in 1985 as assistant editor, and had been responsible for gathering statistical information for MTD's "Facts Issue" since 1993. He won numerous awards for editorial and feature writing, including five gold medals from the International Automotive Media Association. Bob earned a B.A. in English literature from Ohio Northern University and has a law degree from the University of Akron.