Joe Gibbs Racing has been the topic of NASCAR sponsorship conversations since the 2022 season. They had to deal with Mars’ departure from the No. 18 team, while FedEx has been withdrawing its involvement with Denny Hamlin over the years. The importance of sponsorship for NASCAR teams cannot be overstated, as they are an important source of income while providing brand visibility to those associated with them.

Highlighting Joe Gibbs Racing’s loyalty towards its many sponsors, the team’s president Dave Alpern took to social media to share how everyone associated with the organization uses their products daily.

The importance of sponsorship in NASCAR

Despite NASCAR being in the strongest position they have been in years, teams continue to struggle in acquiring and retaining sponsorships. The rise in social media marketing and brands wanting more flexibility means companies look to only sponsor a part of the season, which will generate maximum returns for their investment. This means teams have to bring multiple partners on board to make the business financially sustainable. As things stand, Joe Gibbs Racing has 21 partners associated with them, but considering that they are one of NASCAR’s top teams, it’s easy to see why.

Highlighting how everyone associated with Joe Gibbs Racing uses their sponsor’s products daily, the team’s president Dave Alpern said, “Do NASCAR teams use the brands that sponsor them? Well, speaking for Joe Gibbs Racing, absolutely. Whether it’s Toyota, with our parking lot out front of our building being full of Toyotas, with our drivers and many of our people, whether it’s drinking Coke or Monster or Dewalt. If you walk through the shop, everybody’s using their Dewalt tools.

“Every car, both personal and on the race car has an interstate batteries in it. We ship only with FedEx, we use sound gear for all of our hearing, we’ve got Rheem units powering our AC and HVAC at the shop. Even technical partners like Seimens, we use their software as well here in our building to help us go fast. So every partner that’s on the car, we all use personally and it’s a great privilege for us to support the companies that help us go racing.”

The sponsorship landscape in NASCAR has changed significantly in the last two decades. In the 2005 Daytona 500, 60% of team sponsors were Fortune 500 companies, but by 2023, that figure has dropped to 20%. Major sponsors such as Subway, Mountain Dew, GoDaddy, Jimmy John’s, Home Depot, and Farmers Insurance have already departed and it won’t be surprising if others follow suit. FedEx was once a season-long sponsor for Denny Hamlin’s No. 11 Toyota but has now reduced its sponsorship to almost half the season.

Kyle Busch’s departure from Joe Gibbs Racing can also be attributed to the loss of sponsorship. The team lost its $25 million annual deal with M$M on Busch’s car, after which Mars Inc. followed suit. As a result, Busch later revealed that Joe Gibbs Racing couldn’t find any sponsorship, prompting him to leave for Richard Childress Racing, where sponsors such as Lenovo, Lucas Oil, McLaren Custom Grills, and others were waiting for him.

All things considered, it’s unsurprising why Joe Gibbs Racing president Dave Alpern is highlighting how the team uses their sponsor’s products daily. After all, remaining in their sponsors’ good books is key for the team to succeed on track as well, which in turn helps get more sponsorships. However, one thing is clear, while sponsorship in NASCAR isn’t going away anytime soon, the type of sponsors the sport attracts will see a significant shift in the coming years.

Why challenger brands are the future of sponsorship

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NASCAR was once considered a premium sponsorship opportunity for blue-chip companies, and that remains true to some extent. 23XI Racing has used the combined star power of Michael Jordan and Denny Hamlin to build a sponsorship roster comprising big consumer brands such as McDonald’s, Mobil 1, Walmart, Dr Pepper, DraftKings, and others. However, the same isn’t true for most teams.

The majority of teams in NASCAR rely on smaller brands that are still scaling up. Not only will that trend continue, but grow, as challenger brands have more to benefit from sponsoring NASCAR teams than already established companies. Moreover, surveys over the years have indicated that NASCAR fans are considered the most brand-loyal in sports, and with sponsorships so deeply woven into the very ecosystem, it’s unlikely that consumer brands will pull out completely.

Like any industry, NASCAR has seen a pivot in sponsorships over the years. However, the sanctioning body has signed a $7.7 billion media rights agreement, which is a clear indication that interest in the sport remains higher than ever before. As long as fans are watching the sport, sponsorships will remain a major part of NASCAR. The only difference is, smaller brands will feature on your favorite driver’s car.

What are your thoughts about team sponsorship in NASCAR? Let us know in the comments!