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NASCAR Cup Series going full steam ahead on new sponsorship model

By Kyle Funderburk

LAS VEGAS, NV - DECEMBER 01: Staff reveal the NASCAR and Monster Energy logos during a press conference as NASCAR and Monster Energy announce premier series entitlement partnership at Wynn Las Vegas on December 1, 2016 in Las Vegas, Nevada. Monster Energy, which will begin its tenure as naming rights partner on Jan. 1, 2017, will become only the third company to serve as the entitlement sponsor in NASCAR premier series history, following RJ Reynolds and Sprint/Nextel. (Photo by David Becker/Getty Images)
LAS VEGAS, NV - DECEMBER 01: Staff reveal the NASCAR and Monster Energy logos during a press conference as NASCAR and Monster Energy announce premier series entitlement partnership at Wynn Las Vegas on December 1, 2016 in Las Vegas, Nevada. Monster Energy, which will begin its tenure as naming rights partner on Jan. 1, 2017, will become only the third company to serve as the entitlement sponsor in NASCAR premier series history, following RJ Reynolds and Sprint/Nextel. (Photo by David Becker/Getty Images) /
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NASCAR turned down Monster Energy’s offer to sponsor the Cup Series through the 2020 season, signaling a commitment to their new sponsorship model.

The Monster Energy NASCAR Cup Series is no more after the 2019 season. NASCAR rejected Monster Energy’s offer to remain as the title sponsor for one more year, showing that they are ready to move forward with a three-tier model set to bundle races, tracks and other aspects in the sport into packages for different companies to sponsor.

The new name of NASCAR‘s premier national series is expected to simply become the NASCAR Cup Series. There is no word yet on if the Xfinity Series and Gander Outdoors Truck Series will adopt this model. They are locked into their current deals for a few more years.

The upcoming model is similar to what other sports leagues around the world either have had in place for a while or have recently adopted. The major American sports leagues have never had title sponsors, and the English Premier League elected to drop the title sponsor model in 2016.

What the new model will look like

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Rather than a title sponsor working out a deal with NASCAR, the tracks and television broadcasters, all three will be bundled together. That much is certain. Branding of a race on TV would be “the NASCAR Cup Series presented by [insert different sponsor each week here].”

At race tracks, it’s a little more difficult to predict since every race aside of the Daytona 500 already has a title sponsor. With sponsorships being bundled, it is still unclear if title sponsors for each track not owned by International Speedway Corporation will be included, but NASCAR probably has some plan to include them. We’ll have to wait for more details on how that level of sponsorship will mesh with the current system of race sponsorship.

Uncertainties

There are still a lot of mysteries regarding this new model. Will certain races on the schedule be bundled together? Could we see the “NASCAR Cup Series West Coast Swing presented by [title sponsor]”? Other tracks and races could get similar bundles, including the races at short tracks, the races at road courses and the races in each round of the playoffs.

The biggest mysteries are who the sponsors are going to be and what each of the three sponsorship tiers include. That first issue is being negotiated, and Monster Energy is expected to become a “second tier” sponsor. Maybe this will result in Monster Energy becoming the “official energy drink of NASCAR”. Other companies can become the official whatever of NASCAR.

Is this the right move?

This is arguably a move that NASCAR should have tried to make in the 2004 season after Winston was no longer able to sponsor the Cup Series. There’s a reason everyone else has either moved away from the title sponsor model or never adopted it in the first place.

The current title sponsorship deal with Monster Energy reportedly costs the energy drinks company $20 million annually. The new model is expected to generate much more money, which makes sense.

NASCAR can charge sponsors more per race, but those sponsors will end up paying less because they either aren’t committed for a full season or are sponsoring on a lower tier. NASCAR will then end up making more money while being far more attractive to far more sponsors.

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How long until all of the details about this new sponsorship model are released? Monster Energy wasn’t initially named the title sponsor of the NASCAR Cup Series for the 2017 season until December 2016. Then again, Nextel was announced as title sponsor of the Cup Series for the 2004 season in June of 2003.

Based on this, NASCAR will likely begin making some announcements this summer about who some of the sponsors will be and what they will be sponsoring, exactly. Most details should be announced by the end of the season.

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