NASCAR -- The Art of Branding & Other Management Lessons

Thanks to the extraordinary hospitality of the folks at Toyota Motorsports, I had a dream day for a business writer on July 12th. My next book, which will be coming out next year, is about management lessons from the history of auto racing. If I had had even a small clue how many management insights I would gain from studying auto racing, I would have written this book five years ago. It has been an amazing experience to study auto racing over the past 60 years from Formula 1 to IndyCar to NASCAR. One of the real highlights of my research was July 12th when I immersed myself in the NASCAR culture. I walked away with lessons for businesses of all sizes.

On July 12th I attended the 2008 NASCAR Sprint Cup Series LifeLock.com 400 at the Chicagoland Speedway. The race began at 7 PM, and I drove into the parking lot at 11 AM, eight hours before the action started. Or so I thought. It turns out that I was attending my first NASCAR race as a fan on the exact 50th Anniversary of Richard Petty's first NASCAR race as a driver.

A Lot of Value Under One Concept

A NASCAR race is so much more than just a car race. It's a Super Bowl event. There were 75,000 people there, and I estimate there were at least 20,000 people tailgating at 11 AM. I repeat this was EIGHT hours before the race started. It's a giant carnival, with actual old-fashioned barkers yelling out that they had free offers inside their tents. It's a giant concert with singers and entertainers on stage all day. It's a massive outdoor mall with over 100 booths selling caps, shirts, buttons, miniature cars, giant corn dogs, and even some lemonade stands.

A NASCAR event attracts every conceivable brand name product. I walked through the largest Abraham Lincoln museum I'd ever been in outside of Washington, DC and Springfield, IL, and it was on wheels. I saw a display set up with dozens of the largest and most magnificent televisions I had ever seen.

What is the overall concept of the value your company offers and how can you deliver that value in synergistic ways that can support each other?

Personalize Your Brand

However, the strongest brands there were the racecar drivers themselves. People of all ages wore shirts with the faces and numbers of their favorite drivers. There was booth after booth of shirts, cups, cars, and other take home goodies with pictures of individual drivers and the number of their car on them. I bought two small replicas of the M&M's car that Kyle Busch drives for both of my children and a Toyota Racing t-shirt for my self.

On top of all that, the drivers themselves appeared all over the place to meet with fans. These drivers are highly paid and are doing extremely intense and dangerous work for nearly three hours during the race. However, for several hours leading up to the race they went around and said hello to fans. Can you imagine a CEO who makes millions and millions of dollars a year going around to customers for several hours to talk with his or her customers right before an important board meeting? That's essentially what these racecar drivers do before every race.

How can you make your organization's brand more personal for customers?

Create an Amazing Event and Repeat It Over and Over

There are 43 drivers who compete at each NASCAR Sprint Cup Series race and there are 36 such races each year all over the U.S. This is a traveling circus that is bigger than any circus I had ever witnessed. And then there's the race itself. You haven't heard LOOOUUUDDDD until you've heard a NASCAR race. If you haven't been to a race, then watching it on television doesn't explain the speed well either. These cars were within a few inches of each other going at least 160 MPH and jumping from high to low on the turns in the track.

I was fortunate enough to watch the race from the Toyota skybox that overlooked the start/finish line of the race. Talk about being spoiled. This was my first race and I had a perfect seat. It's hard to explain the power, speed, and simplicity of a NASCAR race. Even a neophyte like me can get the basic concept pretty quickly. After the two warm up laps are over, the pace car exits, the green flag waves, and the idea is to finish first. The greatest glory, points, and cash goes to the winner of the race.

The whole day pulsated with lessons both inside and outside the track on branding, innovation, teamwork, strategy, execution, planning, problem solving, winning, dealing with change, and preparation. It was an amazing experience.

How can your organization create a breath-taking experience that a wide variety of people would want to be a part of?

Pit Row is the Ultimate Branding Intersection of Fans, Racing Teams, and Sponsors

One of the highlights of the day was being allowed to spend 45 minutes walking up and down pit row a few hours before the race started. Pit row has the 43 pit stalls that the drivers use during the actual race to have their tires replaced, cars refueled, and any car problems fixed. The actual racecars were sitting about 25 feet away on pit row itself while I walked up and down.

At each pit stop, the crew members were there to answer questions. There were several hundred fans walking up and down from one pit stop to another. Each pit stop had the corporate logos of the various sponsors for that specific racing team. There were well over 100 corporate logos including businesses from every conceivable industry on the walls of the pit stops and on the infield grass inside the track.

This was branding heaven where customers, corporations, and racing teams all met in one spot. It created an extraordinary win-win-win situation. The racing teams provided additional value to the customers by letting them see up close where the cars went during the race. I saw hundreds of photos being taken where fans would sit with the crew members and get their pictures taken in the pit stalls. Every one of those pictures the fans took had corporate logos in them. That meant the sponsors would be seen thousands of times when those pictures were developed and shown with pride to family members and friends. These corporate sponsors weren't just hidden on the last page of a brochure. They were part of the fan interaction with the racing teams at the pit stalls.

Because of this amazing synergy, the fans had a great time, the sponsors gained tremendous recognition, and the racing teams and the drivers gained significantly in terms of brand loyalty for themselves.

As I watched all of this several questions popped into my mind. Can you imagine professional baseball or football players letting fans look in their lockers a few hours before the game and have their pictures taken standing in front of those lockers? Can you imagine corporate logos all over the lockers and the field itself? You might think that would ruin those games, and you might be right. However, think of the total cost of going to a Major League Baseball game or an NFL Game. I can't afford to take my wife, Barb, and our children, Ben and Sarah, to very many major-league baseball games. We have this thing called college tuition to pay for someday. The last time I went to a major-league baseball game it cost me something like $225 for one night. Yipes.

At the NASCAR event, the parking was free, the food was reasonable, and the ticket prices were not exorbitant.

How can you create a pit row in your business? Make a list of all of the types of customers you have. Now make a list of all the companies that would like to sell to those customers. Could you create a unique event for your customers featuring your products and services? Could you then include other companies at that event as sponsors who would underwrite the cost of the event and benefit from being in front of your customers? By creating this intersection of value for your company, sponsors and customers, you may be able to strengthen your brand and the sustainable, profitable growth of your organization.

The Reality of Caution Flags in the Business World

During the race there is one turn in the track that has nothing to do with what's right in front of the racecar driver. It's called the caution flag. When debris lands on the track or a car gets damaged while racing, the caution flag is waved and all the drivers have to slow down and get behind the pace car. That doesn't seem too bad, except for the lead driver. Even if the driver in front has a 15 car length lead, he or she has to slow down and let all the other cars line up right behind so the whole caravan of cars goes around the track at the same time behind the pace car. The cushion that had been built for the lead car over the course of the race suddenly evaporates.

When I went to Chicago to experience my first NASCAR Sprint Cup series race, Jimmie Johnson, the two-time defending Sprint Cup Champion, had managed to take the lead from Kyle Busch with about 16 laps to go. He extended that lead to 20 car lengths going into the final two laps with just three miles left. A lot of people thought Johnson had the race won. Then the unexpected happen, and a caution flag came out. When the race resumed, Busch immediately got right behind Johnson, who tried to play defense. Johnson went low on the track, and Busch went high. With that move Kyle Busch stormed to victory.

This same thing happens in business. You're doing a good job and staying focused. You've built tremendous momentum and you are well beyond the pace needed to achieve all of the important business outcomes. Your organization is by far the best in the industry, and you continually generate significant, sustainable, and profitable growth.

Then suddenly the market place changes. Instantly all the businesses in your industry slow way down. A series of national stories about your industry immediately sends even your most loyal customers searching for alternatives.

Think of the housing downturn that occurred in 2007 and 2008. Suddenly the most successful and the least successful real estate agents were compressed into an incredibly tight market. The leader's lead was no longer what it had been. When there is even an isolated incident of Mad Cow disease, it sends restaurants and grocery stores into a temporary spiral, whether they were way ahead of their plan or way behind.

This is why it is so important to focus on improving performance and not solely on your relative position compared to others at any given moment. Just because you had a great or terrible quarter doesn't mean you're stuck in that position forever. Perhaps your competitor made a big sale right before the quarter ended, and you made one right after the next quarter started. It looks like you're way behind when in reality you're not.

Markets change, trends change, and customers get fickle. Rather than letting a sudden change cause you to slow down or speed up your performance, focus on continually improving what you do. In this way, you are making progress all of the time because you're learning from the experience rather than giving up. You're maturing and preparing yourself for greater success in the future.

When your market gets compressed how will you be prepared to win the race in front of you?

I encourage you to go to a NASCAR race, but get there way, way before it starts and let the lessons on management soak in.

The Coughlin Company Client Services

The Coughlin Company works with mid-size companies, and mid-size business units inside large corporations, to improve business momentum. If you want to learn more about our keynotes, organizational consulting, or executive coaching, please click this link.

Republishing Articles

Each month my e-newsletter gets republished in approximately 20 blogs, on-line publications, and internal publications for businesses, universities, and not-for-profit organizations. If you would like to republish all or part of my monthly articles, please send me an e-mail at dan@thecoughlincompany.com with "Republishing Article" in the subject heading. I will send you the article in a word document. All I ask is that you include my name as the author of the article and a short paragraph at the end of the article about me with a link to my website.

Take care and have a great month!

Dan Coughlin

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