Race Sponsorships Should Be Partnerships, Not Free Parts and Stickers

Michael Timmons

Aug 24

8 min read

If I had a dollar for every time someone asked me to sponsor their race team or pay to have a sticker placed on their car, I’d be sitting on a beach watching the sunset every night. But race sponsorship is far more complex than free parts, cash, or logo placement. Let's dig into some hard questions both manufacturers and racers need to understand about each other's position.

We can go much deeper than this article, but I don't think that is for everyone. So, we'll just touch the surface and talk about this from 100 feet above the racetrack.

Race sponsorship has been part of the automotive aftermarket for decades. Unfortunately, many sponsorship programs still operate under an outdated model:

“We’ll give you some parts. You put our sticker on the race vehicle.”

That may technically be a sponsorship, but it is not much of a marketing strategy.

A strong race sponsorship should be a business partnership between the brand and the racer or race team. Both sides should clearly understand what they are investing in, what they are receiving, and how they will help each other grow.

That means looking beyond free product and race results.

The best partnerships can create value through marketing, content, product development, brand credibility, customer engagement, dealer relationships, social media, event exposure, technical feedback, and ultimately sales growth.

But none of that happens automatically.

Racing Is Expensive

Before brands evaluate a sponsorship request, they need to understand what it costs to race.

Depending on the type of race, teams may have expenses for:

· Entry fees

· Fuel

· Tires

· Transportation

· Hotels

· Meals

· Crew expenses

· Vehicle maintenance

· Replacement components

· Engines and transmissions

· Safety equipment

· Testing

· Fabrication

· Support vehicles and trailers

· Insurance

· Race registration

· Communications equipment

· Photography and video

· Social media and marketing

· Unexpected repairs

A serious race effort can consume an incredible amount of money throughout a season.

That does not mean a brand should automatically fund those expenses. It means the brand needs to understand what the racer is investing into the program as well.

The racer has skin in the game.

The brands that support them should too.

Just think about what it costs to have a sales team on the road visiting customers. It's not cheap.

How Much Should a Brand Spend?

There is no universal sponsorship budget.

Brand size, profitability, customer demographics, product category, market position, marketing strategy, and sales goals all matter.

However, one gauge I like when planning marketing budgets is approximately 2% to 3% of overall sales for all marketing activities. Sponsorships should be 0.5% to 1% of that.

This should include:

· Racing sponsorships

· Influencers

· Ambassadors

· Events

· Special partnerships

· Contingency programs

· Promotional vehicles

· Content creation

· Strategic brand collaborations

That does not mean every company should automatically spend 3%.

A $3 million company and a $100 million company have completely different resources.

More importantly, they may have completely different customers.

If 80% of your customers are hardcore off-road enthusiasts, racing may be an extremely important part of your marketing strategy.

If very few of your customers follow motorsports, your investment should probably look different.

The question should always be: Does this sponsorship put our brand in front of the customers we want to reach, and what do you think your ROI needs to be?

What Does ROI Really Mean?

This is where sponsorship conversations become difficult.

A brand gives a race team $10,000 in product and cash.

Someone asks: “How many dollars in sales did we get back?”

Sometimes that can be measured. Sometimes it cannot.

Sponsorship ROI should be measured across multiple areas.

For example:

1.) Sales ROI

Did the partnership generate identifiable sales?

This can be measured through:

· Discount codes

· Affiliate links

· Dealer referrals

· Customer leads

· Event sales

· Website traffic

· Landing pages

· Promotional campaigns

2.) Marketing ROI

How much usable marketing exposure did the partnership create?

Look at:

· Social reach

· Engagement

· Video views

· Photography

· Website traffic

· Email content

· User-generated content

· Event exposure

· Media coverage

3.) Brand ROI

This is harder to measure, but extremely important.

Seeing your product on a respected race vehicle tells the consumer something.

It says: This team trusts our product.

It says: Our product is being used in an extreme environment.

And it says: We support the racing community.

That brand association has value.

Just remember that having your logo on a vehicle doesn't automatically mean sales will increase.

A sticker creates visibility.

A partnership creates opportunity.

Build a Marketing Plan Around the Sponsorship

Before the first race, the brand and racer should create a simple marketing plan.

Do not wait until the vehicle is sitting on the starting line.

The plan might include:

1.) Product Installation Content

When the product arrives, create content around it.

Show:

· Unboxing

· Installation

· Why the team selected the product

· Product features

· Setup

· Testing

· Adjustments

· Preparation for the race

One sponsorship can potentially create weeks of content before the vehicle ever competes.

2.) Race Weekend Content

During race weekend, the team can create:

· Pre-race posts

· Behind-the-scenes videos

· Vehicle preparation

· Team interviews

· Starting-line content

· Race footage

· Product close-ups

· Pit footage

· Results

· Post-race analysis

The brand should then share that content through its own social channels.

This is where brands sometimes miss a major opportunity.

The racer posts great content, tags the company, and the brand does nothing with it.

That is wasting part of the sponsorship investment.

The Brand Should Help Grow the Racer Too

Partnership works both ways.

If the racer creates a great video, the brand should share it.

If the team gets a podium, congratulate them.

If they produce a great installation video, repost it.

Feature the team on the company website.

Include them in newsletters.

Tag them on social media.

Use their photography.

Invite them to events.

Introduce them to dealers, distributors, or other industry partners when appropriate.

A manufacturer may have 100,000 followers while the racer has 8,000.

When that manufacturer shares the racer's content, the racer gains exposure too.

That increased exposure can help the racer attract additional sponsors, build their following, and grow their racing program.

That is a partnership.

What Does the Racer Get?

Depending on the agreement, the racer might receive:

· Free product/discounted product

· Replacement parts

· Technical support

· Race support

· Cash sponsorship

· Travel assistance

· Entry-fee support

· Marketing exposure

· Social media exposure

· Introductions to other industry partners

· Product development support

· Contingency awards

Not every sponsorship needs to include cash up front.

Sometimes technical support, replacement parts, marketing exposure, and discounted products can provide tremendous value.

The important thing is that both parties understand what is being exchanged.

Consider a Race Contingency Above a Standard Program

Another way brands can support racing is through a structured contingency program.

Instead of sponsoring every racer directly, the company rewards racers with bonuses based on performance.

For example:

1st Place — $1,000 product credit or cash

2nd Place — $500 product credit or cash

3rd Place — $250 product credit or cash

The program could also reward:

· Class wins

· Championships

· Podium finishes

· Fastest qualifying

· Finishing specific events

· Championship points

Participation could require racers to:

· Register before the event

· Run the company's product

· Display approved branding

· Tag the company

· Submit photos

· Provide race results

· Follow specific social-media guidelines

A contingency program can allow a company to support dozens or even hundreds of racers while keeping the program organized and measurable.

Product Development Can Be Part of the ROI

Some of the most valuable sponsorship relationships have very little to do with stickers.

Race teams can become extremely valuable product-development partners.

They can provide feedback about:

· Durability

· Installation

· Heat

· Product tuning

· Suspension performance

· Component wear

· Packaging

· Failure points

· Serviceability

· Instructions

· New-product ideas

Racing pushes products harder than most consumers ever will.

That feedback can help engineering and product teams improve the product.

Now the race team is not simply sponsored. They are helping develop the next generation of products.

Create Content Together

One of the strongest sponsorship strategies is creating content that benefits both sides.

Instead of saying: “Post about our suspension.”

Create a content calendar together.

Maybe January is the build.

February is installation.

March is testing.

April is the first race.

May is a technical video.

June is a customer Q&A.

July is midseason maintenance.

August is a race recap.

September is product testing.

October is a major event.

November is championship coverage.

December is a season recap.

Suddenly one sponsorship becomes an entire year of marketing content.

That changes the ROI equation dramatically and brings value to the P&L.

Put Everything in Writing

This may be the most important part of the entire sponsorship program for both parties.

Create a contract.

The agreement should clearly explain what each party is responsible for.

It should cover things such as:

· Length of agreement

· Product provided

· Cash provided

· Discount levels

· Number of social posts

· Required tags

· Product installation requirements

· Logo placement

· Event appearances

· Photography requirements

· Video requirements

· Race schedule

· Product feedback

· Exclusivity

· Content usage rights

· Contingency requirements

· Performance expectations

A 12-month agreement is often a good starting point because racing and marketing results take time. Connection can leave, and racers can move on.

The contract should also contain a termination clause.

What happens if the racer stops racing?

What happens if the team does not post?

What happens if the brand does not provide what was promised?

What happens to product that was supplied?

What happens if either party wants to end the relationship early?

These conversations are much easier to have before a problem arises.

Free Product Isn't Free

Brands also need to stop thinking about sponsored products as having no cost.

A $5,000 suspension system given to a race team costs the company money.

There is:

· Manufacturing cost

· Labor

· Packaging

· Freight

· Technical support

· Replacement parts

· Administrative time

· Marketing resources

There is also opportunity cost.

That same product could have been sold.

That means you should track sponsored products like any other marketing investment.

A Logo Isn't a Marketing Strategy

Race cars, trucks, buggies, motorcycles, trailers, haulers, and team uniforms can provide great brand exposure.

But visibility alone is not enough.

A logo does not automatically create sales.

What it does create is brand value and brand association.

Consumers see that respected racers are using the product.

They see that your company participates in the sport.

They see that your company supports the community.

Over time, those impressions can create credibility and trust.

The strongest programs take that awareness and connect it to content, product education, dealer marketing, social media, email campaigns, events, and sales initiatives.

That is how sponsorship becomes a real marketing program, and hopefully a long-term partnership.

Sponsorship Isn't for Everyone

Not every racer deserves sponsorship.

And not every brand needs to sponsor racing.

There must be alignment.

A racer with 200,000 followers but an audience that does not care about your product may provide less value than a racer with 10,000 highly engaged followers who are exactly your target customer.

Likewise, race results alone should not determine sponsorship value.

Someone may be an incredible racer but terrible at marketing.

Another person may consistently finish mid-pack but create outstanding content, interact with customers, attend events, help with product development, and generate sales.

The right partner depends on what the company is trying to accomplish.

Think Long Term

The best sponsorships are rarely transactional.

They become relationships.

The racer understands the brand's business.

The brand understands the racer's goals.

Both parties look for ways to help each other.

The team helps promote and prove the product.

The brand helps the team grow its audience and racing program.

Both create content.

Both engage customers.

Both share successes.