Sponsorship vs. Partnership

I contacted one of my suppliers last year to let them know how instrumental they have been towards the success of my racing season. They are an OEM parts supplier and have a massive inventory and super easy to use website with fair prices and fast shipping. I included a picture of me jumping the BMW during a CHCA hill climb event. Surprisingly the CEO responded to my email about an hour later and cc’d their Marketing Director. He followed up with me and told me I should apply for their sponsorship program, a program where you basically earn discounts for social media posts and post likes for discounted parts. I thanked them genuinely and told them I was not interested in any sponsorship.
Wait, what? I turned down an offer for discounted parts, parts I probably already buy, in exchange for simply adding their hashtag to posts I already make? That seems like a no brainer doesn’t it? The thing is, I don’t believe in sponsorship, I believe in partnerships.

What is the difference?
A sponsorship is broadly defined but in motorsports and by my definition it means discounted parts or labor in exchange for promotion of a brand.
A partnership, again by my defininiton, means free parts, free labor, or direct financial assistance in exchange for promotion of a brand.
The difference is subtle but very important to me. What I define as sponsorships in my opinion devalue all products and hurt the motorsports industry. This is best described by an example.

Let’s make up a company so as not to single any company. Norslip brakes offers a “sponsorship” program. You go online, fill out an application, send in a few pictures of your “race” car and they approve the sponsorship. Yes! You just got your first sponsorship! You may not realize that they never turn down an application but that is irrelevant. You now have the opportunity to support their brand and save some money, what does that hurt?

Norslip sells their products through a diverse distribution network of big box online retailers like Summit Racing and Speedway Motors. Anyone can be a dealer for Norslip, they offer a tiered dealer offering. $5k minimum, 20% off if you spend over $5000 per year, 30% up to $20k, and 40% over $20k. The $5k min will keep most small dealers away and will redirect them instead to the wholesale distribution branches of places like Summit and Speedway. Guess what they probably offer dealers in their network? 20% off, the same they offer their sponsored teams. So you are getting the same price for the product as your local retailer. You are also the primary customer for the local retailer so they now will find it harder to sell or carry this product or recommend it as they can’t compete with the manufacturer direct. Summit and Speedway probably always have them at least 10% off with free shipping and you avoid paying sales tax. Norslip themselves probably sell them on Amazon for nearly 20% off with free shipping. They are hurting their brand by making it no longer special though they are getting huge benefits in visibility at race tracks at zero cost. They have suckered you into buying their products by making you feel special. You are giving them free advertising in exchange for a discount that you probably could have gotten from existing dealers and this happy feeling leads you to use a product that might actually be inferior.

Brands offering these types of sponsorships devalue their brand image and hurt small dealers. They sucker us into using their products by making us feel special as sponsored drivers. As a race car driver I am in the search for the fastest way around a track or down a stage. Balancing affordability is important but I am never striving for the cheapest way. As a shop owner I search for the products that will help my clients achieve this same goal. There are many products I believe in but cannot offer my customers through our storefront because they have devalued their brand so much that it will actually cost me money to competitively sell the product.

Sponsorship such as described takes no investment nor requires any commitment or effort from the manufacturer. They are taking the only commodity you have to offer and getting it for free.

Racing takes tremendous effort to do. It’s expensive, it’s hard, it requires epic amounts of time away from home, family, business, work, and life obligations. There really is no cheap way to do things and be successful. Perhaps budget conscientious, but never cheap. If you are going to go out there and freely advertise and essentially give away the only commodity you have to a company that is sponsoring you in a way that actually requires zero effort from them you are devaluing that commodity.

At Rally.Build we have had a few partnerships in our history, some have turned out great and continue to this day, others left a sour taste. We continue to promote brands and companies we like and believe in even when we have no vested monetary interest. We try our best to give back to the sport through direct monetary contributions to series, events, volunteers, and facilities that make rally great again. We envision a rally world in which teams are partnering with companies giving them financial incentives to advertise on their cars. A world in which the best drivers are tested in an achievable championship with strong competition that creates a spectacle that fans want to watch. Where top drivers don’t bankrupt themselves trying to make it and disappear forever but rather find places driving for top teams. One in which businesses like Rally.Build, Rally Ready, DirtFish, Team O’Neil, Team Illuminata, Broken Motorsports, Primitive Racing, Heavy Metal Motorsports, JRD Tuning, ChaseRace, Dave Clark Motorsports, Susquehanna, Davenport Racing, Trackside, Dmack USA, Streetwise, Feal, and the many other currently operating rally businesses can thrive and support each other, our competitors, and our series of events.

So, what should a privateer team do? Focus on sponsorships from local businesses and figure out how you can give back to them. If a performance clutch kit costs $600 and you could get 20% off by putting that sticker on your car you now know what that space is worth to you. Go to any locally owned store and ask them to sponsor you for $120 and in exchange you will drop off a 5×7 framed picture, drive in the local parade during fair season, and give them two Saturdays of on site promotion (parking the rally car out front of their business.) Over deliver and you may see another $120 next year. Maybe you and the owner become friends from this relationship and the next year he wants to do more.