Microsoft's 'Free' NASCAR Sponsorship

Leave it to the geeks at Microsoft to figure out how to get the company's logo on a racing car--for free.

The Redmond, Wash.-based software giant snagged a $1 million market-value spot on a NASCAR Sprint Cup Series car without paying a penny. Instead, Microsoft got small businesses that use its software and resellers to pony up the sponsorship cash. So far, 40 small businesses and resellers have put in about $165,000 on behalf of Microsoft.

Since the June 1 race in Dover, Del., Microsoft's small business logo has been emblazoned on the rear-quarter panel of Michael Waltrip Racing team's #00 car. The businesses and resellers that put up the cash, however, don't get to place their logos on the car. Under their agreement with Microsoft, they are allowed to put their logos on a mock-up of the #00 car, and they can post that image on their Web site.


Retail giant Target, a longtime sponsor for the Chip Ganassi Racing team, has been known to offset its sponsorship costs by offering vendors a piece of the action: They might get a NASCAR-themed display in Target stores or even have their logo prominently featured on a car for a single race.

But the Microsoft-Waltrip arrangement is unique in that the team is banking on the tech giant’s ability to corral customers who’ll foot the bill for the spot. "I think it speaks to the economic climate that these teams are dealing with," says Ardy Arani of The Championship Group, an Atlanta sports marketing company. "Desperate times call for desperate measures."

Less than a decade ago, primary sponsors (the ones that get their logo on the hood of the race car) routinely paid teams under eight figures. Today, those sponsors might be asked to fork over as much as $20 million. As a result, some sponsors are balking, forcing teams to get creative with their sponsorship schemes. "What might’ve made sense at $8 to $12 million becomes a difficult equation at $16 to $20 million, because you aren’t necessarily selling more product just because the racing has gotten more expensive,” Arani says.

The Waltrip team will need at least another 200 sponsors to break even on the space's $1 million market value.

From Forbes