Ring the Cash Register: Why Sponsorship Is Really a Sales Job

Strip away the paint schemes and hospitality tents, and a sponsorship is a line item in a marketing budget. Marketing has one purpose: more revenue. A company gets there by selling more units, or by building the brand so customers will pay more for each one. Every check a racer receives has to serve one of those two goals, or it won't be renewed. Executives on my Summit panels say it more bluntly than I do. Their phrase for a good sponsorship is one that rings the cash register.

The logo is one box; the introduction is the big one

Richie Lewis of E3 Spark Plugs explained that the decal and the product placement are the minimum. "What I'm really looking for goes a few layers in," he said on the ROI and Why Brands Sponsor panel at my Motorsports Sponsorship Summit. "What type of B2B can they bring? What type of B2C can they bring? Can they bring business?" He wants to know whether a racer's owners, partners and other sponsors run businesses that could become E3 customers. ▶ Watch the clip

Then he described a lunch he'd had the day before. "Just yesterday I had lunch with one of our athletes, and 80 percent of the conversation is about his relationships, and how we can help his people who are in an industry where they use a lot of gas and propane type generators for landfills. And that rings the cash register, way more so than this E3 logo and 'Hey, I'm running E3, what are you running?' That's great... that's one box that gets checked. But the ultimate box is if he can say, 'Hey, where you're at Nashville coming up here next week, I want to introduce you to this guy, because they have this type of equipment.' Now you're ringing the cash register." ▶ Watch Richie Lewis explain this

Notice what the athlete actually delivered. It wasn't a podium or a social post. It was an industrial customer for spark plugs, found through his own network. A brand can't buy that from a media company, so it's worth more than anything printed on the truck.

Every sponsored rider is part of the sales force

At the Motorcycle Racing Sponsorship Summit, Scott Lukaitis, director of sales and marketing at Engine Ice, put a number on his expectations. "You have to sell product, right? As much as we like to give product away and give discounts, that's not what we're all in business for. The idea is, for every dollar I spend with sponsorship, I want three to five times back." ▶ Watch Scott Lukaitis on this

He sees part of that return at the dealer counter. "It helps with the dealerships when people walk in, there's that recognition. But the end of the day, you sponsor so that you can sell more product. So it's up to those athletes that we work with to be our salesman. If we count on the distributor reps to be salesmen, we want all of our sponsored riders to be salesmen as well."

That's the mindset shift. A distributor rep earns their keep by moving product. A sponsored rider is judged by the same standard, just with a race bike instead of a sales territory.

Give them a way to count your sales

Brian Henderson, chief strategy officer at Wheel Pros, gave racers a simple way to prove they're selling. "As a racer, go to your sponsors, ask them if they have an affiliate program, ask them if you can get a code," he said at the Motorsports Sponsorship Summit. Hand that code to the racers in your pits who are paying full price. "You're bringing all these sales. Guess whose sponsorship gets renewed the quickest? The guy that's bringing sales." ▶ Watch Brian Henderson on this

Wheel Pros was building that into a program of its own: cards with each sponsored driver's name that send buyers to a dedicated website. "For us it's not only important to sell the product, but it's also to collect information," Henderson said. The site would show who each racer brings in, what they drive and where they race. His reasoning comes straight from the budget meeting: "In the current economic environment, marketing budgets are shrinking... If you can now have the people you're paying to race bring sales in the door, that helps everybody."

If a sponsor has no affiliate program, offer to help it test one. The racer who builds the tracking makes the case for their own renewal.

Some of the value never shows up in a spreadsheet

Not every sale can be traced to a code, and the brands know it. Tony Yorkman of K&N Filters pointed to the hardest thing to measure: the fan who stops at the pit and talks to the driver. "There really isn't a way to calculate the quality of an interaction... but those interactions can be the greatest value." ▶ See the full panel

For K&N, those conversations feed the long game, which is the product's reputation. "Our story being the product validity, and we use motorsports as a platform to tell the world our products are superior, and racers can prove that for us," Yorkman said. He also corrected a common assumption. "The story perceived is that sponsors pay people to run their products, and for us, it's we're partnering with them to share why they choose to run our products."

This is the second half of the revenue equation. A brand that is trusted can hold its price. On the same panel, Eric Seibold of ITW Permatex said sealers and thread lockers are always at risk of being seen as just another glue, which pulls them down to the price of every competitor. Racers who show the product holding up at the limit keep Permatex's brand value high, so the company doesn't have to compete on price.

Don't be the stranger asking for five bucks

Joe Parsons of Monster Energy closed the panel with a comparison every racer should remember before sending a cold request. "You walk down the street and someone says, 'Hey, you got five bucks?' Do you give them that five bucks? Chances are you don't give them that five bucks. But you walk in the store around the corner and you give that store owner five bucks, because you're getting something. So someone out of the blue asking me for sponsorship is no different than the guy walking down the street saying, 'Hey bro, give me five bucks.'" ▶ Watch Joe Parsons on this

Parsons told the audience he typically requests a deck only so he can sell a deal to his own upper management, after the relationship already exists. The store owner gets paid because a customer walks out with something. Your pitch has to show the brand what it walks away with.

The takeaway

• List every business your team, your family and your other sponsors touch. Those are B2B introductions you can offer before you ask for anything.
• Ask each sponsor for an affiliate code or tracked link, and report what it produced.
• Treat yourself like a distributor rep: know the product line, talk to the dealers in your area and send customers their way.
• Track the things codes can't capture, like product questions answered in the pits, and include them in your season report.
• Before any request, write one sentence that finishes "You'll sell more because..." If you can't finish it, you're asking for five bucks.