Wednesday
Mar112009

NASCAR: An Empty Grandstand Headed Your Way!

Peter M. De Lorenzo is a national columnist who founded Autoextremist.com, a highly-regarded website devoted to news, commentary and analysis of the auto industry. He is considered to be one of the most influential voices commenting on the business today.No, not the catchiest of advertising slogans, admittedly, but one that’s growing more and more appropriate for NASCAR, version 2.009. Unfortunately, NASCAR and its drivers are a little slow on the uptake as to what’s really going on. What happened at Atlanta Motor Speedway last weekend - when more than one-third of the grandstands stood glaringly empty on a perfect pre-spring day - was more than just a reaffirmation of just how bad the nation’s economy is. Rather, it was a clear indication that NASCAR’s slow but sure slide, which has been building up over the last three seasons, has finally broken out into the harsh light of reality, and no amount of spin by NASCAR marketing and PR operatives or the apologists at Fox Sports is going to be able to conceal it any longer.

Why this should be a surprise to anyone who has been closely watching this trend is beyond me. The Associated Press reported that Jeff Gordon said he was “…a little baffled. I know there’s a lot of race fans around here. I’ve been hearing that they were going to have some empty seats. It’s hard to say. It’s really hard to say. … This place should be packed.” Now Jeff is a smart guy and a great race car driver, but like everyone else totally immersed in the NASCAR Way, it’s understandable that he’s far too close to it to be able to step back and see the Big Picture. Because if he were able to actually do that, what he’d see wouldn’t be pretty - as a matter of fact, it should be downright scary to every member of the NASCAR circus.

NASCAR reached the All-NASCAR-All-The-Time saturation point somewhere around 2006, and it has been a downward slide since. As I’ve said repeatedly over the years, no sports property can stay that hot for that long (except for the juggernaut NFL, of course), and NASCAR is no exception to the rule. After ten years of explosive growth (abetted by the implosion of open-wheel racing in the U.S.), NASCAR was poised for a fall.

And true to form, empty grandstand seats (along with declining TV ratings) started appearing at NASCAR races not long after the sanctioning body signed the most lucrative TV deal in its history (eight years, $4.8 billion, beginning with the 2007 season) with FOX, SPEED, Turner’s TNT and ABC/ESPN. I’m not suggesting there’s a correlation there, but I am suggesting that at the very moment NASCAR inked that billion-dollar deal, NASCAR’s feverish ascendancy had already peaked. Not unusual for big-time sports by any means, by the way - after all, players usually get paid for what they accomplished the season before, and whether or not they’re deserving of that huge contract is something that has to be played out over the life of that new contract.

In NASCAR’s case it’s clear that the networks were the ones that got played, and it’s what’s down the road that has some of the more enlightened NASCAR insiders worried, very worried.

In talking to some very well connected media friends, “give backs” (when a TV network has to give money back to sponsors due to poor ratings and undelivered audience numbers) will be the next hurdle for NASCAR to cross, and one even suggested to me that “they won’t get through this deal without some sort of renegotiation.” That’s when NASCAR’s declining TV ratings numbers will seriously come into play.

It’s clear that the next NASCAR TV contract is going to be lower. Substantially lower. And poor economy or no, that does not bode well for the marketing mavens in Daytona Beach, because there’s no amount of cobranding opportunities with Digger that will make up for the kind of hit NASCAR is sure to take when their TV contract comes up for review. That means fewer dollars for everyone - the teams, the drivers and NASCAR - something that, I would venture to say, no one is even remotely prepared for.

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