THE VALUE OF AUTOMOTIVE SPONSORSHIP
In this article, ACA Research considers the returns of sponsorship investment for aftermarket companies
Last year, aftermarket juggernaut Repco signed a multi-year deal to become the sponsor of the Bathurst 1000.
From this year, it is also the naming rights partner for the Supercars championship, as well as of the season opening race on the famous Mount Panorama circuit.
Having already been the official automotive parts retailer of the Supercars Championship, its extensive investment in Supercars begs the question: what is the value of automotive sponsorship?
One aspect of value is clearly viewership. According to data from Roy Morgan, almost 4.6 million Australians watched a motorsports event in 2020, encompassing Formula One, V8 Supercars, the Bathurst 1000, drag racing and rally car racing.
Despite the glamour of F1, the Bathurst 1000 wins out as the single most viewed motorsport event in Australia, watched by over 3.1 million people. It is followed by Supercars (as a whole) with 2.6 million viewers, while Formula One takes bronze with 2.3 million viewers.
Viewership is not however the only metric to which we should be paying attention. Ultimately, companies invest their sponsorship dollars to build recall, which has clearly been successful for former sponsor, Supercheap Auto.
After 16 years as the naming rights sponsor of the Bathurst 1000, Supercheap remains the brand most commonly associated with Supercars. This extends from the most casual Supercar viewer (25 percent of whom recall Supercheap Auto) to those people who attended a motorsports event in the last 12 months (42 percent of whom recall Supercheap Auto).
While it is difficult to quantify, we know that brand awareness has a direct correlation to sales – in the end, consumers will buy from brands they know and trust.
It is important to note that this level of brand association is built up over time. Once established though, they clearly show staying power, even after the sponsorship has ended.
The value of motorsports sponsorship is still being realised by Qantas, with more than one in ten motorsports attendees still associating the brand with Formula One despite it relinquishing the naming rights nearly a decade ago.
Which brings us back to our starting question…is it worth it? Looking at an individual team, the cost to operate a Supercar is an eyewatering $3-$5 million per year, with Tekno Autosports Team Principal, Jonathon Webb, very explicit that it is not for everyone, stating in an interview with PickStar, “motorsport is bloody expensive.”
Sponsorship isn’t just about naming rights on the bonnet, doors, or boot, with sponsors also able to leverage further incentives in the form of ride days for clients and customers.
Despite this, money has tightened up in recent times, with corporate groups more calculated as to how they spend their sponsorship and marketing budgets. While there are a number of complexities to this, Jonathon reasons that a significant factor in this development is a realisation that generic sponsorships aren’t working in motorsport.
Ultimately, it makes sense that automotive companies will benefit the most from sponsoring motorsports events, aligning their brands with the adventure and excitement of racing, and hopefully increasing brand awareness and sales.
While a strongly-positioned brand like Repco is better placed than most to tap into this, we must still remember that longevity is key.
We will be watching with interest to evaluate the impact of its new sponsorship deal, but it is likely to take a certain amount of time to fully realise these benefits.
This column was prepared for AAA Magazine by ACA Research, our partners in the AAAA Aftermarket Dashboard which is delivered to AAAA members each quarter.