Kyle Busch’s sugar daddy is leaving, and his NASCAR future is uncertain

The president of M&M’s parent company Mars Wrigley, Anton Vincent, spoke about the company evolving, becoming “consumer obsessed” and the need to focus on “consumer interest and other passion points.”

“There’s a bit of a shift in the sports marketing strategy,” Vincent told Forbes.com earlier this year. “Our consumer base is very distributive.”

Are you following? OK, then let me translate: Kyle Busch’s illustrious NASCAR career is in a holding pattern.

“You never expect to be in this predicament,” Bush said in a telephone conversation Tuesday.

Kyle Busch and his car have worn the M&M logo and colors for 15 seasons.

Kyle Busch and his car have worn the M&M logo and colors for 15 seasons.

After 15 years as the primary sponsor of Busch’s Cup Series cars, M&M’s is gone this year. A 15-year relationship is highly unusual in NASCAR, but eventual breakups happen all the time.

There is no doubt that Kyle Busch will be in a quality car next year and beyond. But it might not be the familiar No. 18 Toyota owned by Joe Gibbs — Busch says he’d rather stay where he’s won two championships and trucking trophies, and Gibbs apparently wants to keep him.

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In any of the other well-known sports leagues, that would basically seal the deal. Kyle and Joe would continue to drive together.

But major league auto racing is a very different vehicle. And this particular high-profile development, which reminds everyone how dependent top teams are on corporate partnerships, may help everyone decide there must be a better way.

“In other sports, a team doesn’t lose a sponsor and then have to give up their top talent,” Busch said. “Certainly, the business model can stand some help. And I know there are some team owners who have recently come into our sport, and they’re really fighting for it, trying to help make this model better.

“Obviously it’s hard to find that kind of unicorn as a replacement sponsor – someone who spends $15 million to $25 million on our sport in just 12 months.”

A separate decision is coming for NASCAR and the teams

NASCAR’s business model revamped its wardrobe starting in 2001, when the first network television deal was launched. For the past 21 years, the wall-to-wall deal has generally involved two networks splitting the season — currently it’s Fox and NBC.

The 10-year deal, good for 2015 to 2024, is reportedly worth a total of $8.2 billion. Where is this all going?

I’m not sure where or how it was all spent, but the front-end portion has been the same all along: 10% goes to NASCAR, 25% goes to the 36 chartered racing teams (via undisclosed racing wallets), and 65% goes to individual speedways (NASCAR, by the way, has 11 tracks that host 18 races in its current 36-race schedule).

There has recently been talk of the split changing with the next TV deal, which will begin with the 2025 season.

“How far it goes, I don’t know,” Bush said this week.

Since the last TV deal was signed, a handful of new owners have entered the garages and some have dabbled in other sports and bring varying degrees of thought and ideas. Also, in recent years, the Race Team Alliance — originally founded in 2014 — has grown collectively. Some things, however, will remain beyond the teams’ control.

It’s a bit strange, looking from the outside. With every new NASCAR network contract, the dollar figures go up, and not a little. Media coverage has expanded and taken some new forms. However, in the two-plus decades since the first network agreement was negotiated and implemented, the largest corporate team sponsors have pulled out.

Abandoning this exposure doesn’t seem logical, but experts point to the growing segments of the sports entertainment industry and the wide range of choices CEOs and chief marketing officers now face.

“It was unfortunate. . . the NASCAR landscape,” Busch said. “They boomed in the 90s. If you weren’t in NASCAR, you weren’t big enough, you weren’t cool enough. There were sponsors in our sport who were making money by being here. Their conclusion. . . he was making them money in NASCAR.

“The CEO or CMO wanted to make a change and they didn’t want to do it anymore, and they left. The Targets of the world, Dollar Generals, UPS, Lowe’s, Home Depot. They were here, they did a good job making money and now they’re not here.”

And now, Mars and the M&M’s brand are also headed for the exit ramp. Left scrambling is a top-tier racing team and a driver, Kyle Busch, winner of 60 career Cup races, two championships and at 37 still at the top of his game.

Is there a fix for NASCAR?

It cries out for a structural fix, but it’s not that easy. Other sports do this with salary caps – some are stricter than others. Also, for example, along with a cut of NFL media revenue from the Miami Dolphins, as well as their share of merchandise sales and various sponsorships, they sell tens of thousands of premium tickets and suite packages at home games.

A major league sports team could run the season on just the money it gets from the TV cut, but it would be a small business compared to all others. The extra sponsorship dough is used, most importantly, to lure and pay the best talent – drivers, crew, mechanics – and buy the best equipment available to help make their cars faster.

“Cubic dollars” is the old term for money equals horsepower.

They can increase the teams’ cut of TV money. Maybe even pay enough money for a team to run a full season with enough talent in the cockpit and race shop to run fast. But racers don’t just want fast, they want faster, so they’d still be beating the bushes for additional funding to facilitate that desire.

The only way they could combat this, and possibly bring some balance and sanity to it all, would be to enact a spending cap.

That’s a whole other kettle of fish for another day.

— Contact Ken Willis at ken.willis@news-jrnl.com

This article originally appeared in The Daytona Beach News-Journal: Kyle Busch’s NASCAR ‘sugar daddy’ is leaving. What has happened? | KEN WILLIS

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