In this week’s Business of Being a Race Driver I cover a number of things that you should be aware of as you build your racing brand both on and off the track. Racing is a business, more so than most other sports from a participant’s standpoint and so as a driver, there are certain things you need to be successful and Tom Baker from Steering Wheel Nation looks at these essentials. Megan Meyer explains how to post on social media, and Power Sponsorship looks at how to not make a fool of yourself in your first meeting with a sponsor. In the Costs of Racing, I cover the costs of buying a turnkey touring car race car in the United States, changes to the Indy Lights advancement prize fund, an increased prize fund in MX-5 Cup and running the SCCA Runoffs on a college budget. There are also several case studies you can use as well as a number of resources to help you find the sponsors you need to go racing. All this and much more so sharpen your digital pencils and take notes!
The Business of Racing
Advice Running Your Race Driving Business
- Tom Baker of Steering Wheel Nation looks at some of the necessities that any race driver needs if they are to treat their racing as a business. “If all you have is a race car and a driver, you have a hobby. Sponsors will not sponsor a hobby. Before you even approach a company about sponsorship, you must decide to run your race team like a business. Once you decide to run your race team like a business, you must have the following three things, because you’re asking to put together a business deal, not a donation…“
- In the video above, Megan Meyer explains How to Post on Social Media.
- Jess Shanahan of Racing Mentor explains why your perfectionism is stopping you from making progress in motorsport. “Unrelenting standards is a term coined by the type of psychology known as Schema Therapy. There are lots of other schemas you might fall into, but let’s look at how having unrelenting standards might affect you as you search for motorsport sponsorship.”
- Motorsport marketing consultant Daryl Curtis has published a Lesson for The Day on how you should Trust Your Instincts! “I don’t care what level of experience you have in your search for sponsorships – whether you are just getting started or have been doing it for some time – at some point you have to trust your instincts when it comes to determining whether or not a company is a good fit and what your approach should be with that company.”
- Sport Dimensions looks at Why Sponsorship Works More Than Ever in 2022. “Sponsorship can be an integrated alternative to traditional media marketing and a platform where consumers are receptive to hearing your message. The data points to how motorsports, and also emerging sports, score much higher than the average messaging engagement figures captured by SportsBusiness Journal in their annual online survey. Recent growth for motorsports across mainstream media and audiences has also been a boon for new sponsorship programs. Add-on value like Netflix’s Drive to Survive and Race show how the on-track product can be enhanced through thoughtful storytelling in a different venue.”
- When you are out there pitching for sponsors, don’t assume that you are the only one doing so and that all pitches are offering substantive ROI. Make sure that your pitch is not a race to the bottom, as this is the number one reason that causes businesses to suffer from pitch exhaustion. “It would be a shame to categorize all sponsorship opportunities with the above experience – even though it happens all too often to the world’s best brands. Seek out sustainability, organic engagement and the value to be gained by thinking long-term.”
- Power Sponsorship has excellent advice on The First Sponsor Meeting (and How Not to Make an Idiot of Yourself). “The first meeting with a sponsor is both the most important, and the easiest to screw up. Sponsors know what they want to hear, they know the red flags, and if you get it wrong, you could foul a potential deal, and not even know why.”
- At the 2022 Motocross Sponsorship Summit (recorded live at Troy Lee Designs on August 26, 2022) Rich Houseman of Hookit and Heath Cofram of Alpinestars rank the most popular social media platforms for race teams. You can watch the video above to find out more.
- In Fan-Powered Deals Could Be the Next Big Thing in NIL, Front Office Sports looks at the potential, and obstacles facing fan-powered NIL (Name, Image, Likeness) deals. “In fact, fan-powered deals have the potential to take a multibillion-dollar share of the NIL market — the biggest in the industry, Opendorse CEO Blake Lawrence told FOS. “The buying power, cumulatively, of fans in each market is larger than that of the brands and donors.” But while the potential is great, so are the obstacles — from unsustainable business models to athletes’ own barriers to entry.”
- CSM, Sport Dimensions and Prism on the state of motorsport sponsorship and where it goes next. “With the Covid-19 pandemic and inflation squeezing marketing budgets across the board, the BlackBook spoke to a group of agency executives to get their take on the health of the motorsport sponsorship industry today, the current challenges facing rights holders and brands, and where the sector will go next.”
Here are a few case studies discussing examples of motorsport marketing and community building, starting out with local sponsors and why the Ogio Powersports brand would want to get involved in sponsoring motorsport.
- Last week on the Motorsport Prospects blog, digital strategist Nirupam Singh looked at how Canadian race driver and inaugiral USF Juniors Champion Mac Clark maximized his social media presence and built up his community of supporters to advance his career.
- At the 2022 Motocross Sponsorship Summit Lew Lewis, Team Manager of Jeremy McGrath Motorsports (2013 – 2020) talks about starting out with local sponsors in the video above.
- At the 2022 Motocross Sponsorship Summit Pat Lopez, Athlete Manager at OGIO Powersports explains why the company sponsors and how its athletes make Ogio a fun brand in the video above.
The Costs of Racing
- If you are interested in racing touring cars and you are based in the United States, The Drive has an excellent article for you. Touring Cars Fresh off the Lot: Which Automakers Sell Turnkey Racers looks at turnkey race cars that you can purchase. “There’s still a way to directly place an order with several companies, and they will deliver a factory-fresh race car to your door or local dealership. These performance vehicles aren’t cheap to buy, race, and maintain by most people’s standards, but when compared to other pro-level offerings like the Porsche 911 GT3 Cup Car, they all offer a lot of value. Let’s take a look at what a few automakers, including Honda, Audi, Hyundai, Toyota, Subaru, Mini, BMW, and Mazda, have available at the moment in the United States.”
- Over at the SCCA website, in The SCCA Runoffs on a College Budget, Hagerty explains how a college student was able to race in the SCCA Runoffs on a minimal budget. “Being a young SCCA member, scraping together the cash to race while paying for college was a rough endeavor. Austin purchased a first-generation Mazda RX-7 and swapped in an older rotary motor he had on hand. From there, he hit the circuit to qualify, which involved a stop on the Hoosier Racing Tire Super Tour at Portland International Raceway, where he ultimately landed on the top step of the podium.”
- Mazda has expanded the MX-5 Cup prize money to over $1 million USD for 2023. “In all 14 races of the 2023 Mazda MX-5 Cup Championship, a total of $27,000 will be up for grabs amongst the top 10 finishers. Each race win will net $6,000 to go along with the champagne-stained trophy, with $5,000 going to the runner-up, and $4,000 for third. Just like the year-end prizes, the payouts cover the full top 10 finishers, with $3,000 on offer for fourth, $2,000 for fifth and $1,000 going to sixth through 10th place. Additionally, as long as at least two females start the race, the highest placed female driver will receive $2,000. The championship purse will remain unchanged, with $250,000 going to the winner, $80,000 to the Rookie of the Year and payouts continuing through 10th place. Also unchanged are the prizes awarded in the Mazda MX-5 Cup Shootout, where the winner receives a scholarship to compete in the series valued at $110,000, plus two more scholarships valued at $75,000, including one set aside for the top female driver.”
- In what came as a surprise to many, Racer reports that the Indy Lights champions advancement prize has been slashed. “From a year-to-year basis, the reduced Indy Lights graduation package represents a 58 percent cut in support for the new champion. As well, with the price of one-off Indy 500 rides climbing to $800,000 or more last May, the $500,000 would not be enough on its own for Lundqvist or any future champion to participate in IndyCar’s marquee event. The step backwards comes at an awkward time as the series is set to go racing next season with its largest field of entries in more than a decade. The $1 million-plus scholarship and guarantees of racing at Indy and other rounds has been a significant draw to date.” F1 Feeder Series conducts an analysis and argues that Indy Lights growth could be under threat following the scholarship reduction. The Race argues that this is something that needs fixing quickly as it will be difficult to attract underfunded drivers who previously would have used the much needed money to strengthen their budgets for a shot at Indycar.
- Former F1 driver Ralf Schumacher puts a price tag on the pathway to reach Formula 1. “The Schumacher name is one that is very closely associated with Formula 1, so when Ralf, brother of Michael and uncle of Mick, says it costs around €13 to €15 million to get onto the grid, he knows what he is talking about.”
Here are a few resources that you can make look into to assist you in your sponsorship acquisition efforts. Some are articles and videos with advice, some are paid resources you can purchase but all offer valuable guidance to the race driver looking to up their sponsorship game.
- Sponsorship Proposal Templates (Paid Download)
- The International Women’s Motorsports Association is moving to a membership model offering a wide variety of benefits to members including their newest offer called Tool Kit, which includes articles about social media, marketing, sponsorships, branding, media, and many other topics, with new information added weekly.
- I have covered the topic of NFTs here on Motorsport Prospects and how they apply to motorsport and more specifically, the race driver. Here are some resources both from Motorsport Prospects and beyond on what NFTs are, how a race driver can use the technology and some ideas on what the future holds.
- NIL, NFTs, DAOs and the Future of Driver Development: Opportunity Knocks
- One Electric Racing Driver’s Guide To Sustainable Blockchain
- Sustainable Blockchain Source Guide
- The complete guide to NFTs
- Half of Americans still haven’t heard of NFTs
- How To Launch An NFT – Key Tips For Sports Organisations
- From Starbucks to sailing leagues, Web3 loyalty programs are being tested more broadly