Answer the following question using your own words. ( Original work please)

Reading will be down below

1-Evaluate NASCAR's branding strategy in relation to its overall marketing strategy. Could NASCAR have done anything differently to insulate itself against the economic downturn?

2-Conduct a strategic SWOT analysis for NASCAR at this point in its history. What opportunities are available for NASCAR to take advantage of given its many significant strengths?

3-What strategies do you recommend to counter the criticisms leveled against NASCAR? Should the company become more involved in sustainability initiatives? If so, how might that be tied in with NASCAR's branding strategies?

4-What strategies can you offer to move NASCAR to the next level in its evolution? How can the company maintain, or even increase, its sponsor and fan base?

Case Exhibit 11.1 NASCAR's Most Valuable Teams $400 $350 $350 $300 $250 201 Millions of dollars $200 146 170 150 $150 132 $100 $50 Joe Gibbs Racing Team Penske Hendrick Motorsport Stewart.Hass Racing Roush Fenway Racing Richard Chidress Racing Michael Waltrip Racing Chip Ganassi Racing Front Row Motorsports Richard Petty Motorsports Teams Conclusion Branding has evolved to represent the personality of a company, and NASCAR is a shining example of an organization that successfully embraces the branding mantra. Throughout its 65-plus years of existence, NASCAR has developed and implemented a branding strategy that encompasses a wide range of marketing initiatives. Brands are built on powerful emotional connections through an extremely wide variety of touch points. NASCAR delivers these connections through event marketing, emotional branding, brand communities, customer understanding, drivers, differentiation, co-branding, and the understanding that once a brand has been created, it must be monitored and allowed to continuously evolve. However, in spite of NASCAR's highly successful branding strategy, the future of NASCAR is uncertain. The most recent economic recession hit NASCAR hard, and it has still not fully recovered. The majority of sports are suffering as sponsors pull their endorsements. Yet for NASCAR, which depends so much on its brand alliances and partnerships with other companies, the pullout of sponsors has had an even greater impact. The lower attendance at NASCAR events is also a concern. As consumers strive to save money, discretionary spending on entertainment is one of the first budget items to be cut. NASCAR has taken a proactive stance toward the issue by lowering ticket and concession prices, changing the racing structure, and working with communities to offer incentives to get fans to travel to the events. Whether these actions will be successful remains to be seen, but the intense brand loyalty of fans certainly lies in NASCAR's favor.Speedway, which offered a paved racetrack. The 2.5-mile racetrack provided an enclosure and more accommodations for spectators. Ten years later, France opened the Talladega Superspeedway in Alabama, a 2.7-mile racetrack that is the largest oval track in the world. France would serve as NASCAR president and CEO until 1972, when his son William France, Jr., took over. NASCAR continues to remain largely under the control of the France family to this day, a source of some contention among NASCAR fans and critics. In the late 1960s and 1970s, NASCAR tracks began to emerge outside of the Southeast. Tracks were built in Delaware and Pennsylvania. Since then, NASCAR has tried to become more of a national sport, building racetracks in many U.S. states. Early Corporate Sponsors of NASCAR NASCAR's growth really took off when it partnered with automakers Ford, General Motors (GM), and Chrysler in the 1950s. The automakers hoped their support of NASCAR would boost their own sales. The marketing phrase "Win on Sunday, Sell on Monday" became popular with the automakers as it was believed that success in the races meant greater success for their companies. In 1971, the R.J. Reynolds Tobacco Company's Winston brand became a sponsor of NASCAR. During that time period, NASCAR also formed limited sponsorships with Union 76, Goodyear Tires, and Pepsi. Anheuser-Busch began to sponsor NASCAR's Budweiser Late Model Sportsman Series in 1984. NASCAR would soon become famous for its branding partnerships, and the support of major sponsors and brands has contributed to NASCAR's well-known image. NASCAR's Jump in Attendance NASCAR began to experience unprecedented growth in the 1990s, coming a long way from its 1.4 million attendees in 1976. To help with this growth, it launched its first website in 1995, which offered up-to-date news on NASCAR activities and even had a NASCAR community where members could chat online and post opinions and videos. In 5 years, NASCAR attendance increased by 57 percent to over 6.3 million. Its television viewership grew 48 percent between 1993 and 2002, and by 2006 about 6 percent of U.S. households watched NASCAR races on television, compared to less than 2 percent for its competitor, the Indy Racing League. New, younger NASCAR stars such as Ryan Newman, Kyle Petty, and Kurt Busch began emerging, which helped attract the youth market to the sport. Women also began racing for NASCAR, including drivers Tina Gordon, Deborah Renshaw, and Kelly Sutton, the only NASCAR driver with multiple sclerosis. Consequently, female NASCAR fans grew to roughly 40 percent of its fan base. Today NASCAR has approximately 70 million fans and has the second-highest television ratings for regular season sports. NASCAR fans are believed to be the most brand-loyal of any sport, and one estimate claims that fans spend over $2 billion in licensed product sales. For this reason, NASCAR has attracted the attention of numerous Fortune 500 companies. Currently, NASCAR is broadcast in over 150 countries in over 30 languages. NASCAR's Branding Strategy Early on, NASCAR worked hard to promote its brand name. It has been largely successful in its endeavors by integrating multiple marketing initiatives into a well-organized branding strategy. Part of this strategy dealt with partnering and co-branding with other companies. Driver jumpsuits and racecars are filled with the logos of various companies that NASCAR has formed brand alliances with. At the same time, NASCAR has successfully differentiated its own brand and, through the launch of campaigns, has effectively marketed its brand throughout the world. Television Broadens NASCAR's Reach Before the mid-1970s, the only way to watch a NASCAR racing event was to attend a race in person. During the mid- to late-19705, NASCAR began to receive sporadic television coverage, and in 1979 the Daytona soo was the first NASCAR event televised in its entirety. NASCAR started to rely ontelevision as a branding medium, and by 1989 all races on the Winston Cup schedule were televised (later changed to the NASCAR Nextel Cup and then the Sprint Cup). This did not mean that television did not introduce some problems for NASCAR. Each track negotiated its own television contract, which meant that each race could potentially be shown on a different network. This hindered NASCAR's exposure and presented a problem that NASCAR was not able to overcome until the turn of the century. In 2001, NASCAR took a proactive stance by signing a comprehensive television contract with FOX and NBC that was worth $2.4 billion and enabled the televising of all the NASCAR races that season. Just 4 years later, another contract was signed for $4.48 billion, providing broadcasts in a total of 167 countries including Thailand, Pakistan, New Zealand, and Venezuela. Such media coverage has, in part, accounted for NASCAR's large fan base. Co-Branding Enhances Profits and Brand Image NASCAR also recognized the benefits of co-branding relationships. It realized that a successful branding alliance can give the companies involved a greater competitive advantage. In the early 19705, NASCAR was primarily sponsored by R. J. Reynolds Tobacco Company. Today, NASCAR has marketing and sponsorship deals with a wide range of Fortune 500 companies such as Sunoco, Coca- Cola, 3M, Sherwin Williams, Bank of America, and Coors Light. In 2004, Nextel replaced R. J. Reynolds as the series' sponsor, with Nextel paying NASCAR $70 million annually for the title rights. Nextel later merged with Sprint, and Sprint became the third title sponsor in NASCAR's history. The former Busch Grand National Series, which had been sponsored by Anheuser-Busch since 1984, became the Nationwide Series in 2007. In 2015, it underwent another name change-the Xfinity series-after Comcast's XFINITY became its new entitlement partner. NASCAR takes its sponsorship deals very seriously. A sponsor may spend several million dollars for a race team and then spend just as much on promotional events. It is not a task to be taken lightly. Brian France even has a team that runs seminars to help sponsors get the greatest advantage out of their sponsorships. Of course, the relationship between NASCAR and its sponsors changes over time as their needs change and the economy ebbs and flows. During the last recession, NASCAR lost several sponsors due to financial reasons. More recently, Sprint announced that it would not renew its title partnership with NASCAR for 2017. This will cause some challenges for NASCAR as Sprint has been a strong supporter and has worked to create a number of innovations to market the races, including Miss Sprint Cup and the NASCAR Sprint Cup Mobile wireless app. One potential weakness of NASCAR's co-branding is that some experts feel that the sport is becoming flooded with sponsorships. It has about 50 league sponsors and numerous team sponsors. This creates a cluttered environment of signage at the racetracks. Sponsorship has also increased in price within the last few decades, which means sponsors are now expecting more from drivers. Drivers are now expected not only to race well but also to show up for marketing functions and appear early on the morning of the race to sign autographs and answer questions. The pressure is on to win races, not only for the glory of the driver and for NASCAR but to retain the sponsor as well. New teams, even when legendary racecar drivers own them, also have a hard time attracting sponsors, despite the teams' talent. NASCAR driver Jeff Gordon, for example, had a difficult time finding sponsors for his new team featuring novice driver Jim Johnson despite Gordon's legendary status. Sponsors find that co-branding with NASCAR is extremely profitable, saving them from having to promote themselves through traditional media. And, because NASCAR fans are some of the most brand-loyal consumers to be had, NASCAR-sponsored products have benefitted from sizable sales and market share increases. As a result of its co-branding alliances, NASCAR itself offers a plethora of consumer products either as brand extensions or through a direct relationship with other firms. Currently, NASCAR has licensing and merchandising rights for watches, clothes, chairs, tables, grills, hats, clocks, flags, door mats, blankets, auto accessories, sunglasses, and even food products.Differentiation Seeks New Audiences In spite of its various brand partnerships, NASCAR has worked hard to differentiate its brand from other companies, particularly from competing racing circuits. This often takes place in the form of well-coordinated marketing campaigns, such as the lavish campaign NASCAR launched to celebrate its 50th anniversary. One of the strongest differentiating factors for NASCAR is the experience of the race. NASCAR fans like the constant, unpredictable, and even dangerous action. Crashes, live entertainment, and danger all make up the NASCAR experience. With only a single driver per racecar, NASCAR also offers a human touch in the bargain. The driver provides a face and personality to fans, allowing them to strongly identify with NASCAR. Additionally, NASCAR lets several drivers share the spotlight throughout the race. From an owner's perspective, it is more efficient to manage the public relations opportunities of one driver as opposed to an entire team of athletes. A similar dynamic can be observed in advertising and sponsorship during the competition. Within the NASCAR culture, a large amount of sponsorship signage around the track and on the drivers' cars has historically been acceptable and is perceived to be part of the NASCAR experience. Although clutter is an issue that sponsoring organizations must consider, it does not appear to be viewed as negatively by the NASCAR fan base as it is viewed in professional golf and tennis, which are more conservative and traditional sports. NASCAR also differentiates its sport through connections cultivated within the media and Hollywood. Brian France, CEO of NASCAR, realizes that to remain successful, NASCAR must continuously attract new fans. He understands that to attract and retain a young fan base year after year, the promotional strategy requires the support of Hollywood and films such as Talladega Nights. The film features strategic brand placement that includes the official NASCAR logo and the logos of many corporate sponsors. NASCAR has also attempted to further differentiate itself in order to attract other, more diverse market segments. In recent years, NASCAR has made it a priority to create awareness among diverse ethnic groups and among women. Called the "Drive for Diversity," this program gives minority and female drivers the opportunity to compete with a NASCAR team. NASCAR is also pursuing the Hispanic market in the United States, Mexico, and Latin America. In addition to holding races in Mexico, NASCAR routinely creates Hispanic-themed promotions before races held near large Hispanic communities, such as in southern California. Additionally, Mexican NASCAR racer Daniel Suarez is also garnering attention from different segments of the population. Suarez was an alumnus of the NASCAR Next and Drive for Diversity programs. In 2010, he received the Mexico Series Rookie of the Year. He now races full-time for NASCAR's Xfinity Series. NASCAR hopes Suarez's success will portray it as a diversified sports venue as well as attract more Hispanic fans. This integration of racers, sponsors, and fans from the United States, Latin America, and South America seeks to expand NASCAR's popularity and audience over different countries, which separates it from other sports mainly geared toward American audiences. Due to lower TV ratings and competition from other sports venues, NASCAR attempted to generate greater fan interest in the Sprint Cup Series by implementing the Chase for the Cup in 2004. The format was later changed in 2007 and again in 2011. After 26 regular season races, the top 10 drivers, plus two wild card drivers, advance to contend for the Cup championship. Prior to the Chase format, the overall champion was usually determined well in advance of the end of the season. This presented a problem for NASCAR since the timing coincided with the start of football season each fall. With these changes, each of the 12 drivers who contend for the Cup has a legitimate chance of winning. NASCAR's Chase for the Cup turned out to be so popular that the Professional Golfers' Association adopted a similar format. In 2014, a new system was introduced that expanded it to 16 teams.Case 11 NASCAR: Can't Keep a Good Brand Down" Synopsis: This case discusses NASCAR's successful branding strategy and how it became one of the top sports in America. The history of NASCAR is reviewed, followed by an overview of NASCAR's marketing and branding strategies. Despite its unparalleled success, NASCAR has faced a number of challenges and criticisms over the past decade, including declining ratings. The case examines many of the challenges that NASCAR must address if it is to sustain its branding juggernaut and retain its top spot in the motorsports arena. Themes: Branding strategy, branding alliances, brand image, pricing strategy, integrated marketing communication, sports marketing, differentiation, social responsibility In the past 65 years, the National Association for Stock Car Auto Racing, better known as NASCAR, has become the top auto racing series in the United States and the number one spectator sport in America. It has also become well known for its branding alliances, with drivers sporting everything from coffee to deodorant logos on their cars and jumpsuits. The sport currently comprises three national series: the NASCAR Nationwide Series, the NASCAR Sprint Cup Series, and the NASCAR Camping World Cup Series, along with some regional and international series. Although primarily a U.S. sport, NASCAR has held races in Mexico, Canada, Australia, and Japan. It currently sanctions over 1,200 races in more than 30 U.S. states, Canada, Mexico, and Europe. NASCAR's popularity soared over the past 10 years, partially due to extensive media coverage. Drivers such as Jeff Gordon and Dale Earnhardt, Jr., have become heroes of the auto racing industry, and many NASCAR drivers have made appearances in movies and television. NASCAR's growth has been so dramatic that it is now second only to the National Football League (NFL) in popularity. Despite its immense success, the sport has had to overcome challenges in its 65-year history and will likely have to face many more because of declining attendance and other difficulties such as diversity, safety, and its impact on the environment. Still, its strong brand image and brand alliances with other companies will likely keep the sport afloat through these tough times. NASCAR's History NASCAR began with the vision of one man, a worker at an automobile dealership named William Henry France. France was already in love with auto racing when he moved to Daytona Beach, Florida, during the 19305. Daytona Beach was the perfect place for auto racing enthusiasts like France, as the beach's open expanses and flat ground offered a perfect area for races. In fact, by the time of NASCAR's founding over a decade later, automobile racing had become popular in places like Florida, Alabama, and North Carolina. Many sources give bootleggers the credit for promoting auto racing during the 1920s and 1930s, as moonshine cars had to be built to go fast in order to evade the law. The popular idea of bootleggers racing from the law is etched in racing mythology as one of the precursors of stock car racing, although in reality its influence on stock car racing is likely overemphasized. Auto racing continued to increase in popularity in the early decades of the twentieth century. France recognized the potential popularity and profitability that auto racing offered. Yet at the time, this lucrative movement lacked what it needed to become a professional sport, including promoters, racetracks, rules, or respectability on the part of the racers. Therefore, in 1947 France met with owners, drivers, and mechanics at the Streamline Hotel to launch his idea of creating a professional sport out of stock car racing. Over the next few days, they worked on the details for the organization. The first race of the newly formed organization-held on February 15, 1948-was won by stock car racer Red Byron. A few days later on February 21, NASCAR was officially incorporated, with France serving as president and CEO. What is today known as the NASCAR Sprint Cup Series was created in 1949- Racing fans flocked to the tracks, and soon NASCAR names such as Lee Petty, the Flock brothers, and Fireball Roberts became household names among NASCAR enthusiasts. Originally, many of the races were held on simple makeshift tracks, but in 1959 France opened Daytona InternationalOwnership and Structure One major criticism involves the control the France family has over NASCAR. A descendent of William France has been CEO of NASCAR ever since the sport was founded in 1948. In 1972, William France's son Bill France, Jr., took over as CEO of the company, and in 2003 his grandson followed suit. The family continues to be the majority stockholder of the company, allowing them to call many of the shots. Indeed, even those within NASCAR refer to the sport as a "benevolent dictatorship." Some argue that this gives the France family too much power. For instance, William France was known for replacing drivers that would try to unionize. So far, business decisions made by the France family have seemed to work out well for the sport. Many of the marketing strategies and changes the France CEOs have implemented have served to effectively promote NASCAR and attract an increased fan base. Still, some view the dictatorial style of the France family with concern because it depends largely upon the leadership abilities and business savvy of a few. Safety Concerns Another major issue involves vehicle safety. Critics claim that NASCAR often does not implement safety precautions until after a disaster has happened, even if those safety features have been around for years. Its own drivers have expressed concerns over the lack of appropriate medical care received after a crash. NASCAR drivers who have died in crashes include Adam Petty, Tony Roper, Kenny Irwin, and perhaps most publicized, Dale Earnhardt. Earnhardt's death in 2001 was perhaps the most influential in convincing NASCAR to implement more safety features. After Earnhardt's death, NASCAR made it mandatory for drivers to wear a head-and-neck support system, known as HANS, with a seat-belt restraint system. Cars were also equipped with a fire-suppressant system and equipment that measures the forces placed on driver's heads in a crash. One of NASCAR's most visible safety initiatives is the Research and Design Center in Concord, NC, where the Car of Tomorrow was designed for the Sprint Cup Series. The new car, which became mandatory for all Sprint Cup teams in 2008, extended safety measures and set standard tolerances that brought greater equality to the sport. Before the Car of Tomorrow debuted, dominant teams were able to produce cars specifically tailored for each racetrack. NASCAR inspects each car using a coordinate measuring machine to ensure that all teams have cars within required specifications. Yet despite the high hopes for the Car of Tomorrow, fans thought the car looked too boxy and drivers had more difficulty handling the car. The Car of Tomorrow was replaced in 2013 with the Gen-6 model. CEO Brian France admits that the Car of Tomorrow was probably his biggest regret and that NASCAR had not received enough necessary feedback from drivers, engineers, owners, and car manufacturers to make a successful and aesthetically pleasing design for the Car of Tomorrow. Since 2005, Steel and Foam Energy Reduction (SAFER) barriers have been installed in all of NASCAR's tracks. Developed by the Midwest Roadside Safety Facility at the University of Nebraska, SAFER barriers absorb energy among vehicle impact and distribute the energy among the wall without forcing the vehicle back into traffic. This technology offers hope that fewer cars will be involved in a single accident incident, thus decreasing the probability of endangering other drivers. A more controversial safety measure is the use of restrictor plates, a piece of equipment used on superspeedways like the Daytona and Talladega racetracks to reduce speeds of the cars. Drivers have accused NASCAR of trying to manipulate the races with these, but NASCAR insists they are a necessary safety measure. Critics argue that restrictor plates only make superspeedway races boring. Some drivers, including Dale Earnhardt, Jr., and Jeff Burton, have been recruited by Chevrolet to promote safety on and off the track to young children, teens, and caretakers. Working with the National Highway Traffic Safety Administration (NHTSA) and the National SAFE KIDS Campaign, they have successfully aired public announcements regarding using safety belts and child seats properly. This is a positive initiative because NASCAR is one of the highest sports viewed among teens.interestingly, the increased safety regulations of NASCAR venicies have also elicited criticism for doing what they are intended to accomplish-make racecar driving safer. It is believed that NASCAR has lost some of its edge among the 18 to 34-year-old age bracket because the safety features make the races less exciting. Younger fans want to be thrilled, and part of the thrill involves the danger of racecar driving. NASCAR must strike a balance between excitement and safety, investigating ways it can keep racecar driving packed with thrills while also keeping drivers safe. Environmental Impact Environmentalists have cited NASCAR for its lack of environmental responsibility. NASCAR estimates that it uses 6,000 gallons of fuel during a race weekend, which comes out to about 216,000 gallons for one season. It also used leaded gasoline for years after the Environmental Protection Agency (EPA) asked it to quit. Because a law makes NASCAR exempt from the EPA's regulation on gasoline, NASCAR is under no obligation to comply. Yet the pressures to go green have caught up with NASCAR, and in the past few years it has instituted many changes to improve its environmental footprint. NASCAR eventually partnered with the EPA and its fuel supplier Sunoco to phase in unleaded gasoline in 2006 and switch to unleaded gasoline in 2007. In an attempt to carry its green efforts further, NASCAR hired Mike Lynch in 2008 to head the company's new green initiative. NASCAR adopted a higher ethanol blended gasoline for its vehicles. This blend consists of gasoline with 15 percent ethanol. This position has paved the way for the ethanol industry to be in sponsorship with NASCAR, and opened opportunities to connect the NASCAR brand with American farmers who supply the corn. This connection allows for new waves of support for the sport in general. Another big step was the move to fuel-injected engines versus carburetors. Fuel injection systems create higher fuel efficiency while increasing power within engines. According to CEO Brian France, "fuel injection excites the manufacturers, it excites technology companies."Fuel-injected engines are expected to increase fuel efficiency while maintaining and even improving horsepower. Off the track, NASCAR has taken several initiatives to create a "greener" environment reflecting greater social responsibility. NASCAR has agreed to plant 10 trees for every green flag dropped in the Sprint Cup Series races. During the month-long initiative, approximately 150,000 trees are planted across the nation. NASCAR has also implemented a recycling program at all of its tracks. Such cosponsors of this movement are Coca-Cola, UPS, Coors Light, and Office Depot. Diversity NASCAR has also been criticized for its lack of its driver diversity. The majority of NASCAR drivers are white males, which has caused concern among some minority fans. There are still few women in the NASCAR driver populace, even though 40 percent of NASCAR fans are women. Sexual discrimination allegations have also been a problem. In 2008, NASCAR official Mauricia Grant won a $225 million lawsuit for racial discrimination (Grant is African-American), sexual discrimination, and wrongful termination. Additionally, NASCAR has not had many African-American drivers. In 2006, Bill Lester became the first African-American driver in almost 20 years to qualify for a race in NASCAR's top series. According to Lester, many African-Americans are secret NASCAR fans, but are not comfortable coming to the races because they cannot identify with the drivers. Indeed, only a few African-American drivers have participated in the Cup series in its history. In an effort to attract minority and female fans, NASCAR launched the "Drive for Diversity" program in 2004. "Drive for Diversity" is an academy style program where participants learn racing skills in the developmental series: NASCAR K&N Pro Series and NASCAR Whelen, All-American Series. NASCAR has also tried to recruit interesting and recognizable drivers to attract new fans. Most notably, female driver Danica Patrick has been racing full-time since her debut in the Sprint Cup at the Daytona 500 in February 2012. Patrick's participation in NASCAR is important not only for diversity reasons, but also for branding. Danica Patrick is 233 percent more recognizable than the average NASCAR driver, and her activities generate far more media buzz, TV ratings, and race attendance than any other driver. Additionally, African-American Michael Cherry won an event atthe Tri-County Speedway in Hudson, NC, in 2010. By winning this race, Cherry opened the door for other African-Americans to become interested in joining NASCAR. In 2015, NASCAR took a stand for women's issues in its suspension of driver Kurt Busch when it was revealed he had committed domestic violence against an ex-girlfriend. NASCAR acted quickly to discipline its driver and show that it has no toleration for domestic violence. NASCAR's quick disciplinary action against a popular driver demonstrates the seriousness it places on the misconduct. This could further appeal to female racecar enthusiasts. Financial Concerns The impact of the last recession introduced new challenges for NASCAR. One major problem was the financial situation of NASCAR's sponsors and partners. The "Big Three" automakers, GM (through Chevrolet), Ford, and Chrysler, experienced extreme financial setbacks. Additionally, other NASCAR sponsors felt the crunch and did not renew their NASCAR contracts, some of which totaled $15 million. Economic woes also affected NASCAR fans. In the onset of the recession, NASCAR experienced a decrease in attendance and a significant drop in television ratings. The downturn in attendance during the NASCAR race at the Atlanta Motor Speedway in 2009 shocked some racers, as the stands were only two-thirds full. NASCAR was forced to respond by laying off some workers in order to cut costs. As the economic issues lingered, NASCAR continued to face problems. In addition to decreased viewership, attendance also declined at many races that were once consistent sellouts. The Bristol Motor Speedway, for example, enjoyed a 55-race sellout streak until March 2010. The prolonged recession made it difficult for fans to afford a weekend at the races. Although many of the major tracks reduced ticket prices, the cuts did not improve attendance. The economic downturn was especially hard on NASCAR because of its revenue sources. Sponsorship alone is worth over $1.5 billion annually to NASCAR. In 2014, the Daytona 500 fell to a record low, and 18 of 21 Sprint Cup races saw ratings decline. However, there are signs of life on the economic front. TV viewership has started returning, and more sponsors appear to be showing an interest in NASCAR. Low gas prices also bode well for NASCAR. Currently, two-thirds of NASCAR's revenue comes from sponsors, so maintaining strong relationships with sponsors is crucial. NASCAR also has valuable teams that generate a significant amount of sponsorship interest. Case Exhibit 11.1 depicts NASCAR's most valuable teams.Innovative co-branding relationships have also helped differentiate the NASCAR brand and catapult it into new markets. The partnership between NASCAR and Harlequin (romance novels) launched in 2006 created awareness among women who may not have even been otherwise exposed to the sport. It also provided a way for NASCAR to tap into emotional branding strategies. Another effort to attract women and younger people to NASCAR includes a joint venture between the rock band Three Doors Down and Dale Earnhardt, Jr., in which he participated in a music video and the band members drove his car in a race. Additionally, the partnership between The Cartoon Network and NASCAR emphasizes sponsorship diversification directed at the younger consumer. NASCAR's Brand Equity and Brand Loyalty NASCAR's brand equity is the value that is added to a good or service by having the NASCAR brand attached to the offering. As a result, many companies choose to sport the NASCAR logo on their products. A 2005 study by James Madison University revealed that fans appreciate the sponsorship associated with NASCAR. Approximately 93 percent feel that corporate sponsors are "very important" to NASCAR, and 51 percent said that when they buy a NASCAR product, they feel as if they are supporting the sport. A full 40 percent of fans would switch to a product that sponsored NASCAR. Numbers like these account for over $2 billion that fans spend on NASCAR-licensed products. A whopping 47 percent of fans claimed they appreciate a sponsor's brand more because it sponsors NASCAR, giving companies a major incentive to sponsor NASCAR. Finally, unlike some sports figures who are seen as endorsing products just for the money, 57 percent of fans believed that NASCAR drivers use the products they endorse, which further increases the respectability of the drivers in their fans' eyes. Despite all the efforts made by NASCAR to engage the customer, fan interest has begun to decline in the past decade. This situation was exacerbated during the last recession. The median income of NASCAR fans is below that of the national average, making it harder for fans to afford to attend the races. In addition to lowering the cost of tickets, NASCAR also cut the costs of food at its events. To show that it cares about its fans, NASCAR reimbursed the difference to fans at Daytona who had bought tickets before NASCAR began offering lower ticket offerings. NASCAR is clearly making significant efforts to maintain its brand equity and its loyal fan base. However, attendance and television ratings have continued to decline. In addition to lower incomes, it is thought that the retirements of racing legends Tony Stewart, Dale Earnhardt, Jr., and other bigwigs might have contributed somewhat to the lower ratings. As the economy improves and newer drivers become popular, it is probable that enthusiasm for NASCAR will rise once again. NASCAR fans are loyal for several reasons. One reason is the sense of community NASCAR fans feel when engaged in the sport. NASCAR's brand is embodied in its drivers. When fans feel connected to the drivers, a bond is created that promotes the sport's brand image. NASCAR recognizes the sense of community that fans experience as a competitive advantage. One way it connects with its fans is through its NASCAR Mobile app. For an annual subscription of $24.99, NASCAR fans can download the app and receive premium content including driver audio, access to in-car cameras, and advanced leaderboards. Thus, the strong sense of community between NASCAR fans and between the organization and its audience is a driving force behind NASCAR. NASCAR also cashes in on brand loyalty by using loyal fans as brand ambassadors and by establishing an emotional component with the brand. NASCAR's Challenges Despite NASCAR's immense success, the road has not always been an easy one. As with all major companies, the organization has had its share of criticisms and challenges. As NASCAR looks toward its future, a number of significant challenges remain