Analyzing the Role of Contingency Sponsorship Programs In Racing

Let’s say you decide to race a different series than normal, and you’ve never competed in this particular series. As a result, you get to the track much earlier than usual to make sure your car doesn’t need any significant technical modifications to be legal to compete. After an inspection by a series official, which takes less than five minutes to complete, you are relieved to be informed that your car is fully legal and good to go. As you prepare to turn your focus toward going to work on your car’s setup, the official mentions that there’s one last thing you still need to do to meet the series’ requirements.

As you draw in a deep breath waiting to have an unexpected bomb dropped upon you, he puts you at ease by telling you that you just need to add a few contingency decals from the series to your car. You say “sure, no big deal,” and then he hands you the contingency decal packet, which includes more than a few decals. In fact it includes over thirty decals that are required to be displayed on your car. As you look back at him in disbelief he smiles and tells you to “have a nice day!”

In most cases, contingency stickers are part of a contractual agreement between the sponsors and the sanctioning body/series operator. (Addison Blair photo)

This example is played out every weekend across the nation as racers are left with the task of having to find places on their race cars to place contingency decals. The observant bystander would probably ask immediately if it is completely necessary for drivers to be required to put contingency decals on their cars from sponsors who support a track or series, but might not even offer an incentive to the driver. The answer to this in 90 percent of cases is “yes” — due to contractual agreements between the sanctions and the sponsors.

In fact, tracks and series have become so savvy to the fact that many drivers dodge placing the decals on their race cars, they have an official who has the duty of going around and checking cars prior to race time. These officials aren’t looking for technical abnormalities. Rather they are checking to ensure that teams are displaying the necessary sponsor decals before they are allowed to compete. This situation is nothing new, nor is it going away anytime soon.

There are definitive pros and cons to these contingency programs, and we will dive into both sides of the argument in this article.

Many times the decal locations are dictated by the series. (Jim DenHamer photo)

Cover Me in Decals
While some contingency programs have no incentive whatsoever to the racers, even though they are required to display them on their cars, other programs can result in considerable gains for racers and teams. For teams that run with the World of Outlaws (WoO) Super Late Model tour (for example), the contingency program can really line their pockets.

Former WoO Rookie of the Year, Bub McCool, found out during his freshman campaign on the tour just what the program could do for him.

“I probably complained as much as anybody at the first race of the year in Georgia, when I had to cover my brand-new race car wrap in a ton of decals. However, in the first few events I began seeing an extra $100 here and there on my payout, and I would regularly receive cases of various products. That was nice, but when I won for the first time with the tour at Tazewell Speedway, I was shocked at all of the bonuses I received.”

McCool claimed $10,000 for his victory at the 4/10 mile oval, but by the time all of the contingency bonuses were awarded he departed with over $12,000 in cash and over $1,500 in contingency awards.

“Needless to say, I wasn’t complaining anymore after that night.  This contingency deal was a really big shot in the arm for our team that season,” concluded McCool.

Branding with logos. (Jim DenHamer photo)

For some contingency sponsors, they just require their decal be placed somewhere on the car, while others put a lot of thought into the contractual placement of their logo. Research is done to determine where a decal will have the best shot of being photographed or viewed by spectators. Each time these decals appear in pictures, magazines, or other publications, it results in added exposure for the company.

With title sponsorship money harder than ever to acquire these days, contingency programs help many regional events and tours continue to tick. As owner of a motorsports marketing company myself, I witness how these contingencies can keep some organizations afloat on a daily basis.

For many of the tours, tracks, and events that I work with, we came to the sobering conclusion a few years ago that it’s almost impossible to find major cash money from a single sponsor. However, as long as you hold up your end of the bargain, you can put together a nice portfolio of several contingency sponsors who donate small cash amounts, products, or even just services.

Believe it or not, all of these contingency sponsors together can sometimes be the difference in maintaining a successful entity or ceasing operations altogether.”

Contingency sponsors can sometimes be the difference in running or ceasing operations altogether. (Jim DenHamer photo)

Contingency sponsorship programs also serve as a great way for newer (or even just lesser-known) companies to get their name out on the street on a national level.

For example, racers receive a decal for “Piston Company X.” Maybe they’ve been battling piston failures with their current provider, so they look into more information from this company whose decal is on the car. This situation leads to a new customer that the company would maybe otherwise never have had a chance to obtain.

It’s no big secret in the motorsports world that what wins is what sells. If other competitors notice a certain manufacturer’s decal on a car after it’s won a race, then there is an increased chance they will look into using the same products on their own hot rod.

Conflict of Contingency
For the pros of contingency sponsors there are also some definite cons. One of the biggest issues stems from drivers who often see some of the contingency sponsors as worrisome conflicts of interests with their own sponsors.

Super Late Model racer Billy Moyer Jr., recently noted, “I have an oil company that is one of my top associate sponsors, and they provide me with most of my oil products each season. However, some of the series that I race with are also sponsored by oil manufacturers, and I have to run their decals on my car to be allowed to race with them.

(Mark Schaefer photo)

“This is just one example of many sponsor conflicts that I run into with the contingency deals. Luckily so far, I haven’t had any of my main sponsors get too upset about me running their competitor’s decals, but I’m afraid it’s only a matter of time until there is an issue.”

Contingency sponsors themselves are also starting to notice some issues with the way that drivers handle their decals on the race cars. With the innovation of wraps in recent years, drivers with series have become creative with how they incorporate contingency logos into their car design.

These programs are designed to give back to those that support our company via utilizing our products and/or displaying our decals. – Chris Douglas

COMP Performance Group Chief Operations Officer, Chris Douglas, has not been overly pleased with some of the trends that he’s seen recently.

“I noticed at some recent events that not only are our logos faded and shrunk into the background of the designs, but in many cases, our logos are partially covered by car numbers and main sponsor logos. This is not what we signed on for when we teamed up with the series as a marketing partner. We agreed to provide them with awards in exchange for our company logo being displayed on each competitor’s car.”

(Tyler Rinken photo)

As a former racer, Douglas has experienced the issue from both perspectives. “These programs are designed to give back to those that support our company via utilizing our products and/or displaying our decals. Unfortunately, some racers perceive our sponsorship as an entitlement these days, but now more than ever (with the economy) this has to be a two-way street.”

Concealment of logos is not the only issue for contingency sponsors nowadays. In some cases, there are so many contingency sponsors displayed on cars that individual logos seem to be lost in the clutter.

Douglas again commented, “Take a look at NASCAR for example. If you watched the race last week, I want you to tell me what contingency decals you noticed on any of the cars. The reality is that most people can’t even name one, because they all are grouped together in one small section. It’s always been this way to an extent, but again as sponsorships continue to become harder to find in challenging economic times there needs to be a better solution.”

Many times the contingency stickers all are grouped together in one small section. (Jim DenHamer photo)

The Verdict
Clearly there are positives and negatives to contingency sponsorship programs. The verdict on whether or not they are viable options truly varies from driver to driver on their specific needs. It does seem that a happy medium can be achieved — where drivers are required to maintain the integrity (and look) of a contingency logo — if they expect to be eligible for the bonuses that come with running a particular company’s likeness.

Furthermore, it may become a situation down the road, where drivers are given the option of whether or not to run a certain logo if it conflicts with an existing sponsor. Obviously, with the decision would come the understanding that a driver would be willing to forfeit additional bonuses if they elect to opt-out of running the decal.

Either way, the verdict of this writer (albeit partially biased) is that contingency programs have a dutiful purpose in this sport as the added incentives and bonuses allow drivers and companies to effectively prosper in the long run.

What’s your opinion on being required to run contingency decals?

About the author

Ben Shelton

Ben got his start at historic Riverside International Speedway. His accomplished motorsports media career includes journalist, race announcer, and on-air personality.
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