Tags: Earnhardt | Rahal | National Guard | sponsorship

National Guard Cuts Ties With Dale Earnhardt Jr., Graham Rahal

Image: National Guard Cuts Ties With Dale Earnhardt Jr., Graham Rahal
Dale Earnhardt Jr, left, and Graham Rahal. (Sarah Glenn/Stringer/Getty Images; Jason Merritt/Getty Images)

By    |   Thursday, 07 Aug 2014 10:49 AM

On Wednesday, the National Guard announced that as part of the "redesign" of its sports marketing program it planned to end its sponsorship of NASCAR driver Dale Earnhardt Jr. and Graham Rahal in the Indy Racing League.

In a statement posted on its website, the Guard cited a need to trim its marketing budget. The $32 million sponsorship of Earnhardt and $12 million sponsorship of Rahal were prime targets.

“Significantly constrained resources and the likelihood of further reductions in the future call for more innovative and cost-effective ways of doing business,” said Maj Gen .Judd H. Lyons, acting Director of the Army National Guard, in the statement.

The cessation of the NASCAR contract came as a surprise to Earnhardt's sponsor Hendrick Motorsports, which issued a statement Wednesday night saying it has a contract for 2015, according to Sports Illustrated.

“We have not been approached by the Guard about potential changes and plan to honor our current agreement,” the statement read.

Since 2012, the Army Guard's sports sponsorships have gradually dwindled from six to just the NASCAR and IndyCar sponsorships. The National Guard statement noted, in FY2015, the Army Guard’s marketing budget is estimated to be nearly half of its 2012 level.

“To make best use of limited marketing dollars, future programs will have to sustain the Army National Guard brand with the American public, and also generate quality leads that will fill our ranks with the best soldiers that America has to offer,” Gen. Lyons said in the statement.

The relationship between the National Guard and NASCAR has come under scrutiny in recent years, most recently at a May hearing before the Senate Homeland Security and Governmental Affairs subcommittee on financial and contract oversight.

At the May 8 meeting, Sen. Claire McCaskill of Missouri, the subcommittee's chairman, noted the Army National Guard spends 37 percent of its marketing and advertising budgets on sports sponsorships and wondered whether the taxpayer was getting the best deal on its investment.

"One reason these sponsorships may not be generating leads is they may not be reaching the right demographic, which for the National Guard is primarily young adults between the ages of 18 and 24. Only 10 percent of NASCAR's viewers are between 18 and 24, and the average age of an IndyCar fan is between 35 and 54. I am a fan of NASCAR myself, but I do not think this is exactly the demographic that the National Guard is aiming for," contended McCaskill, adding that "for these reasons, the Guard has recently begun to characterize its sponsorship of NASCAR and IndyCar teams as 'branding' rather than recruiting."

The senator's figures, however, appear to contradict the findings of a 2013 study commissioned by the Guard to examine the value of sports marketing to National Guard recruitment.

According to the study conducted by Alan Newman Research, a Virginia-based firm, 90 percent of Army National Guard soldiers who enlisted or re-enlisted since 2007 were exposed to the Guard through recruiting or retention materials featuring NASCAR cars or drivers.

The survey also found that racing fans are an especially receptive group for the Army National Guard. NASCAR enthusiasts aged 18 to 34, the Guard’s target recruiting audience, are twice as likely to consider a military career than nonfans, the study found.

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On Wednesday, the National Guard announced that as part of the redesign of its sports marketing program it planned to end its sponsorship of NASCAR driver Dale Earnhardt Jr. and Graham Rahal in the Indy Racing League.
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2014-49-07
Thursday, 07 Aug 2014 10:49 AM
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