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NASCAR moves toward new sponsor model despite Monster’s offer

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NASCAR is moving forward with a new multitiered approach to title sponsorship despite overtures from Monster Energy about returning for a fourth year as primary backer of its premier series.

A person with direct knowledge of the talks confirmed Monster’s interest to NBC Sports and said it’s probable there will be three tiers in 2020 to replace the traditional title sponsor model. The person spoke on the condition of anonymity because they weren’t authorized to speak publicly about negotiations.

The news that Monster had offered to extend its title sponsorship was first reported by the Sports Business Journal, which also reported that the company could become a lower-level partner.

NASCAR initially revealed its new plan for title sponsorship a year ago while announcing Monster’s one-year extension through the 2019 season. NASCAR President Steve Phelps said then it was “highly unlikely” that Monster would return as the sole title sponsor of the Cup Series, which it joined in 2017 in replacing Sprint.

The new sponsorship model will bundle assets from NASCAR, its tracks, TV networks and teams in hopes of increasing value to make it easier to sell to prospects.

In a Nov. 18 news conference at Homestead-Miami Speedway, Phelps said there had been “a significant number of meetings with potential sponsors.

“There is a general excitement around what the model could be and where it’s going.  So, I’m bullish on making sure that we have the right sponsors in there, and I’m bullish that it’s going to do what it is intended to do, which is to make sure that we are getting sponsors at that highest level and rewarding them for what they do for our sport.”

Kurt Busch on contract status beyond 2018: ‘we’ll see how it all comes together’

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LOUDON, N.H. — Former champion Kurt Busch said Friday that he’s focused on his performance on the track even though his contract ends after this season.

“For me, I’ve just been racing, driving and performing, doing all the things I can do to exceed in all categories, whether it’s teammate things, things on the track … communication with (crew chief) Billy Scott,” Busch said after winning the pole at New Hampshire Motor Speedway.

“I don’t know many drivers that have a primary sponsor with them. Monster Energy has been very loyal to me. It’s just a matter of when the time is to start talking about a contract. Last year, it went long just because I felt I deserved more. The landscape is changing in NASCAR on primary sponsorship values, teams with the purse and the guarantee that they get off the historical performance. There are a lot of things that move, so we’ll see how it all comes together.”

MORE: Stewart-Haas Racing makes pit crew changes

MORE: Martin Truex Jr. laments sponsor leaving after this year

Last year, Stewart-Haas Racing declined the option on Busch’s contact when there were questions about if Monster Energy would return as a primary sponsor. After that was settled, Busch signed a one-year contract with the team. The deal was announced Dec. 12.

This is Busch’s fifth season with Stewart-Haas Racing. He’s won five races, including the 2017 Daytona 500 with the team. He has made the playoffs each year with SHR.

Busch’s pole Friday was his third of the year. He has yet to win a race this season but has 10 top-10 finishes.

“When you go to a track that you have good vibes about and with the team doing well, it gives you that feeling like you’re a step ahead and you just have to execute with confidence and not get too far off expecting good things to happen,” Busch said. “Just go out there and do your job and that’s what we’re doing right now and it’s great to have the pole with the 41 car.”

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Examining what’s next for NASCAR after Monster deal ends in 2019

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CHARLOTTE, North Carolina — NASCAR announced Tuesday that Monster Energy will return as Cup Series sponsor through the 2019 season but is not expected to be in that role after that.

So what does that all mean?

Let us explain.

What happened Tuesday?

Monster Energy’s contract to be the Cup sponsor was set to end after the 2018 season. There was an option for Monster Energy to extend the deal. Monster was to have notified NASCAR before Jan. 1 of its decision. Instead, Monster asked for an extension. Both sides agreed to extend the sponsorship through the 2019 season only.

Why only a one-year extension?

Steve Phelps, NASCAR’s chief operating officer, said both sides wanted it that way.

“For Monster, I think it would be highly unlikely that they would come back,’’ Phelps said. “Both NASCAR and Monster, I believe, are on the same page on that. I wouldn’t say there is anything there hard and fast, but it is highly unlikely that they would return or we would have them return. That is not one-sided. That’s a decision that has been made by both companies. It will give us an opportunity to explore what this new (sponsorship) model looks like.’’

Wait, what is this new sponsorship model?

NASCAR wants to change the structure in how sponsorship would look. The plan would be to bundle the sanctioning body, tracks and media partners instead of having to do separate deals with each.

After NASCAR agreed to a deal with Monster Energy in December 2016, Monster then had to work out agreements with the tracks for signage and such. That took additional time.

Under NASCAR’s new sponsorship model, that shouldn’t be as big an issue.

“What we’re talking about here,” Phelps said, “is looking at combining assets and creating a new sponsorship model.’’

Such a model, though, would not include teams.

“It’s a little more difficult given the number of entities that are out there that are teams to make sure all the teams are participating in one fashion,’’ Phelps said.

So what will the name of the series be after 2019?

Good chance there will be no sponsor name tied to the Cup Series. That way it can be called the NASCAR Cup Series or NASCAR Premier Series or whatever NASCAR chooses to call.

One benefit is that fans don’t have to go through name changes as they have in going from Nextel Cup to Sprint Cup to Monster Energy Cup.

The Premier League did a similar thing in 2016 when Barclays did not renew its deal with the soccer league. There’s no sponsor of the NBA, NFL, NHL and Major League Baseball, but all those leagues have categories of sponsors. That’s the approach NASCAR wants to take.

What if the new model doesn’t work?

“We want to keep our options open,” Phelps said. “There’s some benefit to trying to go all in on something. I think the stakeholders will be in a good place. If the sponsors come back and say, ‘you know what, we’re not sure this is the best avenue to partner with this sport,’ then we’ll have to pivot and go in a different direction. Could we go back to an entitlement model for our top series? We could. Again, I think that’s not our intention. I don’t think we’ll get there, but we certainly want to keep our options open.’’

How does all this impact the Xfinity Series and Camping World Truck Series?

It does not for now. Xfinity signed a 10-year deal to be the entitlement sponsor of that series through the 2024 season. Camping World has a deal in place to be the Truck Series sponsor through 2022.

What happens with Monster Energy after 2019?

Phelps said NASCAR expects Monster Energy to remain in the sport. Monster Energy was aligned with drivers and teams before becoming series sponsor. That avenue would remain for Monster if it chose to do so.

A Monster Energy spokesperson told the Sports Business Journal that the company “wants to continue to be a part of the sport one way or the other.”

What about the sport using a sponsor to build a younger fan base? What happens now?

NASCAR continues to tout efforts to reach a younger fan base. That includes, among other things, children 12 and younger getting in free for Xfinity and Camping World Truck Series races.

Phelps said it was challenging to say if one thing over another was the overriding factor in reaching a younger demographic.

“It’s very difficult to isolate one particular thing vs. another in terms of it being the cause of something,’’ Phelps said. “There are other things that this industry has done over the past couple of years to increase the Millennial audience of NASCAR. That’s a journey we’re going to continue on.

“We have to continue to make sure our content is as strong as it can be that we’re pushing through the digital and social channels. We need to make sure that we continue to cater to kids and to make sure that our Millennial audience is happy. We have to continue the gains we’ve made with our Hispanic fans, which has been significant over the last three years. That journey doesn’t end. And, by the way, we have to make sure that we’re nurturing the existing fan base that we’ve had for many, many years. They’re incredibly important.’’

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Monster Energy extends title sponsorship of NASCAR Cup Series to 2019 only

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Monster Energy will remain the title sponsor of NASCAR’s premier series after agreeing to a one-year extension through the 2019 season but is not expected to return in that role, a senior NASCAR executive said Tuesday.

Steve Phelps, NASCAR Chief Operating Officer, said Tuesday that it is “highly unlikely” that Monster returns as series sponsor as NASCAR looks at a new model toward the entitlement sponsorship. Phelps said it was mutual on both sides to go only through 2019.

NASCAR is looking toward a new model for sponsorship. Phelps said NASCAR wants to bundle sponsorship with sanctioning body, tracks and media partners.

“We want to make sure that our sport is as easy or easier than other sports to do business with,” Phelps said. “We think this is a better model to make sure that sponsors want to stay involved. We think there’s an opportunity for them to feel more invested in the sport … more invested in the sport so they will turn around and do more activation.”

Phelps said he expects Monster Energy to remain in the sport. Monster Energy was aligned with drivers and a team before becoming series sponsor.

NASCAR announced the extension this afternoon. Sports Business Journal first reported the agreement Tuesday.

Monster Energy is in its second year as Cup Series title sponsor after agreeing to a deal in December 2016. The company was to have given NASCAR a decision before Jan. 1 about remaining as series sponsor but requested an extension since 2017 was its first season in that role.

Monster Energy, the fourth brand to sponsor Cup since 1971, is viewed as a company that can connect the sport with a younger demographic.

NASCAR Chairman Brian France was upbeat about what Monster Energy delivered in 2017.

“The promises they’ve made, they’ve kept, with the young demo, edgy shows, edgy marketing, putting our drivers in different places in different light,’’ France said in Nov. 2017 before the Cup season finale at Homestead-Miami Speedway. “That’s what we want. They’ve delivered on that. 

“And like anything else, I think it will get better. This is also a hard program. It’s a complicated program. It’s the best program, but to execute across all these platforms, it’s a big, big sport. There’s nothing like it, so you don’t get an opportunity to just go, well, we’ll do it like that guy did it or this guy does it over here because nobody can have, today anyway, in a major sports league, an entitlement position like this, so it’s a great program ‑‑ and I think it will get better next year.’’

According to Directions Research, 11 million additional NASCAR fans are Monster Energy drinkers. According to the same research, 16 million additional NASCAR fans have heard of the Monster Energy brand.

Cup Series Sponsors

1971- 2003 — Winston

2004 – 2007 — Nextel

2008 – 2016 — Sprint

2017 – present — Monster Energy

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Optimism abounds that Monster Energy will sign extension with NASCAR

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An International Speedway Corp. executive says the company is “optimistic” that Monster Energy will extend its sponsorship of NASCAR’s Cup Series beyond this season.

John Saunders, president of International Speedway Corp., which owns several tracks that host NASCAR races, including Daytona International Speedway, Talladega Superspeedway and Homestead-Miami Speedway, made the comment Tuesday morning during an earnings call with investor analysts.

NASCAR previously stated it is negotiating with Monster Energy and that the deadline for the company to decide was extended from Dec. 31.

Asked about Monster Energy’s status, Saunders said on the ISC earnings call:

“The initial term was 2017 through 2018. It’s our understanding that NASCAR is still engaged in negotiations for an extension. Don’t have a line of sight on how long that extension will be. Initial indications from NASCAR leave us feeling optimistic that there will be an extension.

“It’s been a great brand for our sport. It speaks to a younger demographic. By all metrics from their perspective we think it’s been successful. This is ISC’s position that we think it’s been a successful entitlement for them. So we’re optimistic.’’

NASCAR declined comment Tuesday to NBC Sports about Saunders’ comments and the status of negotiations with Monster Energy.

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