Love it or hate it, almost everyone can agree on a couple of things about NASCAR's Chase for the Championship in the Nextel Cup Series. First, the concept drew increased attention to the sport, and second, like most NASCAR initiatives, it made truckloads of money.
While not always a competitive or artistic success, the fact that the inaugural Chase was a success on multiple levels, especially a financial level, shouldn't surprise anyone. Like any new idea, however, NASCAR's first-ever "playoffs" didn't always deliver. Television ratings flagged, event ticket sales were flat, and teams and drivers openly questioned the new system's sponsorship values
After its initial run, it's obvious there's still work to do as NASCAR and its partners try to make the Chase more equitable for everyone involved. In fairness, the playoff formats of the National Football League, Major League Baseball, and the National Basketball Association weren't unqualified successes in their respective infancies, and all were met with varying degrees of resistance from fans, media, and participants. Each has been tweaked over the years, however, and today all are huge fan and financial home runs. Hopefully, NASCAR will be able to accomplish the same end result.
Here's a look a three areas that didn't go as planned in NASCAR's first playoff season. Rest assured all will be prominently discussed as the sanctioning body tries to improve the concept in its second season.
Television RatingsNASCAR's television partners-NBC, TNT, Fox, and FX-have been singing the money blues since the inception of their '01 contract, with each claiming they are losing millions of dollars on the deal. Whatever the method of financial accounting, the 2004 Chase for the Championship helped the networks recoup a significant portion of whatever monies they had lost.
NASCAR won't admit it, but the television execs are the guys who brought us the Chase for the Championship in the first place. After getting thrashed in the TV ratings by the NFL each fall, the television folks felt like they needed a little something extra to draw viewers away from Sunday football telecasts. Adding a round of playoffs to the NASCAR season seemed a perfect way to increase viewership and revenues.
After all, playoffs in other sports have proven to be a television bonanza as viewership numbers for football, basketball, and hockey playoffs are significantly higher than TV ratings during regular season telecasts. Major League Baseball, meanwhile, sees nearly a 300 percent average spike in ratings for its postseason playoffs and World Series. No wonder the television networks pushed for a NASCAR playoff format. If they can mirror that success with NASCAR, revenues will surely increase
The money came through on the front end as anticipated. Well before NBC took over the television broadcasts at midseason, the Sports Business Journal was reporting that the network's ad revenue from NASCAR would be up 20 percent this year, a "jump attributed primarily to the new format in which the final 10 races will act as a playoff." Additionally, the Sports Business Journal reported NBC had "sold title or presenting sponsor ad packages for 10 races and expects to close a few more by the end of the season." Last year, NBC sold 11 such packages for the entire season.
As "presenting sponsors," NBC required companies such as Banquet, Exxon/Mobil, Subway, and Checker Auto Parts to purchase at least six 30-second commercials. For title sponsors, meanwhile, the tribute increased to as many as 10 commercials and as much as $1.5 million per event. Clearly, the Chase proved to be a windfall in ad revenue for NBC and its cable partner, TNT. Unfortunately, the spike in the viewer ratings never materialized to justify the advertising costs.
The first race in the Chase, at New Hampshire, was telecast by TNT and posted an extremely low 2.8 rating for the Sylvania 300. That number wasn't even close to the percentage of increase experienced by the other major sports for their playoff telecasts. In fact, it was down 8 percent from the non-Chase race at New Hampshire held the previous year, and well below the 4.5 ratings average for the final seven race telecasts in 2003 when Matt Kenseth had all but decided who was going to sit at the champion's table in New York at the end of the season.
TNT's ratings for the second race at Dover, Delaware, were just as dismal, and NBC's telecast of the third event in the Chase at Talladega produced ratings similar to the same event the year before without the Chase. It wasn't until the fifth race of the Chase at Charlotte that NBC posted a respectable 14 percent increase over the previous year's event. Still, baseball ruled the time slot as the Yankees-Red Sox Major League Baseball playoff game on FOX grabbed a 7.9 share, a full 62 percent higher than the 4.9 share pulled in by the UAW GM Quality 500 at Charlotte.
The networks, who indicate they lose money on their NASCAR package, got away with a ton of cash leading up to the first-ever Chase for the Championship, but soft, and in some cases lesser ratings, for a number of telecasts during the Chase will make for interesting conversation when the networks look for ad renewals next year.
Track AttendanceOn the surface, it would appear the Chase would increase attendance, with sellouts everywhere as fans clamor to take part in a special event with the supposed atmosphere of an NFL playoff game. While increasing on-site attendance was a component of the Chase, the end result again proved to be something different.
"I was hoping the NASCAR playoff system would push us to a sellout, something we have never done before for the fall race at Charlotte with the current seating capacity we have," says Jerry Gappens, director of public relations for Lowe's Motor Speedway. "Ticket sales were fairly flat, so I don't know if it's helped that much. Then again, it might not be a fair comparison because of the way the economy is right now. There might be other factors. If it wasn't for the Chase, we might actually be down significantly from a year ago. Either way, it certainly gave everyone hosting a race in the Chase a way to freshen up the last part of the year."
The best way for Gappens and staff to promote their event-the only night race in the final 10 events comprising the Chase-was to emulate the success thelocal NFL Carolina Panthers had during their rush to the 2004 Super Bowl.
"We really promoted this race in our market as the NASCAR playoffs," says Gappens. "We tried to piggyback off the success the National Football League had here in our region with the success of the Carolina Panthers. We definitely felt the Chase for the Championship concept gave a new look to the points chase."
Despite the aggressive approach, which included entry-level price points for seats as low as $19 and $29 (both sold out), the Chase for the Championship concept wasn't enough to put Lowe's over the top, as the speedway was again unable to sell out its fall event.
"That should tell you something," Gappens says. "People are watching their money closer. You're not seeing them put money down 10 months out on renewals. People are very price conscious. Because of basic supply and demand, we've had to adjust our price points to match the capacity we have. Fortunately, we have enough capacity here that we can offer different price points and still meet our company goals."
Lowe's wasn't alone in not filling all of its seats, as Phoenix, Darlington, and Homestead (the final race in the Chase) weren't sold out well into October, less than a month away from their race dates. According to Gappens, if you don't sell out ahead of time, the odds of you doing so on race day are pretty slim.