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The branding of open wheel racing in the USA
by E. Rasmussen Holm

 March 6, 2006

Most certainly the list of advantages recently listed by Mark Cipolloni that could be realized by a consolidation of Champ Car and Indy Racing League constitutes a compelling case for the merger of the two organizations. He has served us well by setting aside Great Divide hostilities and looking forward to what could be achieved by unification.

Unfortunately the enumerated advantages are "could be", not "will be". The difference between the two constitutes a very great divide, so great a one that the respective leaders must achieve actual agreement as soon as possible once structural agreement (assuming and whenever) it is reached as to how this distance is to be spanned. (Such agreement becomes even more important if the merged body is to be a 50-50 partnership.)

At present the rumors are that the respective leaders have reached a level of agreement that permits their respective lawyers to develop the necessary details. Even if true, there cannot but be a huge amount of very fundamental strategizing yet to be done; for what agreement at this point would really constitute is a declaration of trust on each man's part that they can work together to solve common problems and accordingly are willing to meld their organizations. (And for goodness sakes let us all help the process by leaving them alone, not badgering them or their agents with questions as to what is happening---we are not going to find out until they are good and ready, which is as it must be!). It cannot be taken to mean they have solved the problems facing open wheel racing in America.

As AutoRacing1.com has asserted over and over, neither organization is a business success, in both cases being little more than a blip on the screen of the American sports industry. While during the Championship Auto Racing Teams era this was not the case that was then, and the division had the unanticipated effect of destroying one brand without replacement with another brand.

To appreciate this, racing fans must recognize in business there is a well recognized difference between a brand and a commodity. Auto racing, football, baseball, basketball, and hockey are all commodities, just as are tomato sauce, corn flakes, white bread, and coffee. The trick, if you will, is to make a commodity into a brand. Thus we have Contadina Tomato Sauce, Kellogg's Corn Flakes, Wonder Bread, Folgers' Coffee. Is there a difference between a product when branded and when presented in its generic state? To the connoisseur of corn flakes, white bread, coffee, and tomato sauce, perhaps there is; but to the general public, there is not.

IRL first attempted to brand itself as American Open Wheel Auto Racing. Such racing occurs on ovals and is done by American owned teams with American drivers (and if at all possible powered by American engines and monocoques, although this never was actually the case). It was to be take place on American tracks and be centered on the most American of races, the Indianapolis 500. The series specs were low tech both to keep costs low and to be comprehensible to the general public. Financing was even made available to attract teams with small bank accounts. The teams would own their own engines and could work on them just as when A.J. Watson prepared the Flying Ws. And to make the cars "safe", there were tons of downforce. These characteristics were to make IRL a brand, separating it from CART by borrowing some of the traits seen as making the National Association for Stock Car Racing an American brand. The marketing plan failed. IRL did not become a brand.

Therefore, IRL re-invented itself, essentially by CARTizing itself. It wedded itself to manufacturers. It expanded to Japan and looked longingly at Canada and Mexico. It leased engines. It raced on natural road courses. It even raced on urban streets. However even though on paper it had better brand names, it did not achieve CART's success when separation occurred. Instead it began losing teams as costs rose.

Attendance at the 500 perceptibly dropped; and while attendance in new markets such as Joliet (Chicago), Louisville, and Kansas City was impressive, a considerable number attended because their ticket was tied to the purchase of NASCAR tickets or because it was received through promotional efforts (as opposed to being bought by the attendee). Although the titillation of a feminine female driver willing to pose in a bikini increased the IRL blip size in 2005, that in itself will not be sustainable. In short, efforts to create a brand out of a commodity have not succeeded.

Champ Cars had an even more formidable problem, for it emerged from the CART bankruptcy. With but two established teams, it struggled through the 2003 season as little more than a commodity, the closest things it had as a brand name being Newman/Hass Racing and Paul Tracy. Other than them, Champ Car was without distinguishing features, things necessary for it to become a brand.

That it survived the season was little short of a miracle. However beginning in 2004 CC began to develop brand identity. It proposed itself as the center of three days festivals of speed centered in what its leadership hoped to be strategic market areas. Races on the streets of San Jose and Edmonton supplemented the established urban races at Cleveland, Toronto, and Montreal.

However it has not progressed much further than this in its branding efforts. Whether CC can build brand identity as the center of urban festivals of speed is an open question; for while commercial success and local acclaim might be realized with those races, that in itself will not create a national brand identity. As a minimum, the festivals would have to take place in the major urban centers. Houston will be a beginning, but it will have to be replicated in other such cities before CC could become The Festival of Speed Series.

All of this must be seen against NASCAR strategy. Whether by accident or design, NASCAR evolved into a brand because it contained brands much more powerful than NASCAR itself that through identification made NASCAR itself into a brand, much as General Motors evolved because of Chevrolet, Pontiac, Oldsmobile, Buick. Those brands were Petty, Roberts, Turner, Allison, Johnson, Baker, Earnhardt, Waltrip, to name but a few.

AutoRacing1.com has frequently referred to NASCAR's promoting of its drivers, but these drivers initially promoted themselves, with or without NASCAR; and their becoming a brand was more than they or anyone could anticipate. Of course, when it happened, NASCAR's leadership avidly capitalized on the phenomena. CART in its day was able to respond with Team Penske, Andretti, and Unser but never assembled the collection of brands had by NASCAR or even USAC (Foyt, Andretti, Unser, Jones, Ruby, Rutherford). IRL has Team Penske and the Indianapolis Motor Speedway but little else by way of a brand.

Perhaps a great deal can be learned from what NASCAR is presently doing, for it is really attempting to re-invent itself and in so doing is at a crossroad as it attempts to discard its good ol' boys rural South beginnings and evolve from a section based minor sport into a national one--- but without the many notable brands it once had. Whether the brands of Gordon, Earnhardt Jr., Stewart, Busch will be enough in themselves for NASCAR to go national is questionable but perhaps not as important as it once was; for NASCAR is striving to build brand identity apart from the drivers, something both IRL and CC have not come close to achieving.

The recent survey reported by AutoRacing1.com illustrates NASCAR's success. The intent of the survey was to measure the popularity of five sporting commodities: football, baseball, basketball, and hockey, NASCAR. Whoever designed the survey did not recognize the appropriate category should have been auto racing, not NASCAR. For that newspaper reporter and possibly the respondents, NASCAR was the commodity, i.e., the brand and the commodity were one and the same. That's marketing! And it is to that IRL and CC must respond.

What fans must always remember, and it is not easy with the sound of engines in our ears, is auto racing is a business. It is subject to the same processes, rules, pressures as Target, Wal-Mart, K-Mart/Sears, and other retailers---or breakfast food purveyors. In other words, from a business standpoint auto racing is a widget.

For fans the sound of racing engines under one banner is not only music but the resolution of open-wheel racing's problems—but no, not by a long shot is this the case. The division has done a great deal of harm, no question about that. But even greater harm was done by the failure of the CART leadership to be businessmen first and racers second. Roger Penske understood that. His leaving should have been a warning shot across the bow, but CART was too enmeshed in its own coils to re-invent itself. That IRL leadership could not create a business model to replace CART only made worse the plight of open wheel racing.

If there is to be a unification, the real thinking will not be where the XXX Series is to race, whether normally aspirated or turbocharged engines, what minimum car weight, whether standing or rolling starts, the number of wing elements, what balance between ovals, street, natural terrain racing. It will be how to create, recreate if you wish, open wheel racing as a brand and by that creation define NASCAR as one of two brands of auto racing, each very, very different from the other and centered on its own demography. That is what will determine whether open wheel racing will survive other than as a cult activity.

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