After a day of business meetings in Charlotte, North Carolina, in May that brought together executives from Fortune 500 companies including United Parcel Service, Coca-Cola and Sprint Nextel, it was time to unwind. But the executives were not, as is their wont, transported to a golf course.
Instead, they were whisked to a setting decidedly less familiar to cufflink-wearers: a go-kart track. It was the second year of the Aflac 200 NASCAR Corporate Kart Challenge, and competitors flooring it on the straightaways were members of NASCARs Fuel for Business Council, a group of about 40 companies that are NASCARs largest supporters, each spending as much as $25 million to sponsor drivers and races.
While NASCAR often trumpets the high visibility enjoyed by its sponsors, whose logos festoon cars, as well as fans fidelity to brands that bankroll drivers, one of the highest returns for companies investments actually comes not from consumers but from other companies. The biggest fish some advertisers are reeling in, it turns out, are other advertisers.
NASCAR formed the business-to-business group, which meets quarterly, in 2004, and these days is underscoring its value more then ever. In a down economy, sponsors are looking for every nickel to work harder, said Andrew Giangola, a NASCAR spokesman, adding that more than one-fifth of Fortune 500 companies sponsor NASCAR at some level.
Quarterly gatherings include speed meetingssimilar to speed datingwhere company representatives talk strategy in quick succession. Because attendees tend to be marketing and procurement executives, rather than their underlings, the meetings get results, with companies agreeing to drive business to one another and share discounts of up to 20%.
In 2007, according to NASCAR, the Best Western hotel chain generated $16.7 million in revenue through deals made with other sponsors. Best Western hotels now buy office supplies from Office Depot, use UPS as their shipping carrier, and outfit employees in Cintas uniforms; those three companies, in turn, direct employees to book work-related travel at Best Western properties. Another sponsor, Ford, switched to UPS and Office Depot as its preferred shipper and office supplier; in turn, those companies each promoted Ford discount programmes.That potential to bolster employee morale also is being highlighted these days.