Best Buy shares in the glory from Daytona 500 win
Article by: THOMAS LEE
February 28, 2012 - 9:15 PM
When it comes to NASCAR sponsorships, Best Buy Co. Inc. is already basking in victory lane.
The Richfield-based consumer electronics giant struck pay dirt Tuesday when Matt Kenseth of Roush Fenway Racing, which only recently agreed to a major sponsorship deal with Best Buy, won the Daytona 500.
"If you had to pick a race to win, this is the one you wanted to win," Drew Panayiotou, Best Buy's senior vice president of marketing in the United States, told the Star Tribune. "I felt [Kenseth] was going to have a hot year, but I didn't know he was going to win the first [big] race" of the season.
Over the next few weeks, Best Buy plans to purchase advertisements saluting Kenseth and use Facebook and Twitter to promote the sponsorship. The retailer will also host some consumer events. One possibility includes allowing Reward Zone members, Best Buy's most loyal customers, to personally view Kenseth's winning No. 17 car.
But judged against marketing-crazy NASCAR, where every inch of a driver's car and race suit is up for sale to the highest bidder, Best Buy's approach seems rather low-key.
That's not entirely by accident. In the past, advertisers, including Best Buy, would pay celebrities to hawk products or tell shoppers why they should frequent a particular store. Today, Best Buy's marketing strategy is more subtle, an approach that relies more on shared values than actual commerce, Panayiotou said.
Take the Super Bowl. Just a couple of years ago, the retailer hired Justin Bieber and Ozzy Osborne to pitch its stores. But in the most recent Super Bowl, Best Buy opted to purchase a spot that featured 10 relatively unknown wizards in mobile technology who created everything from text messaging to music sharing.
Last December, Best Buy announced it would be the primary sponsor of Roush Racing, which includes Kenseth and Carl Edwards, for the upcoming Sprint Cup series. Panayiotou said he was impressed with how Roush was using technology to create better, faster race cars.
"When you have great technology and you have a user who knows how to use that technology, great things can happen," Panayiotou said.
Paul Swangard, managing director of the Warsaw Sports Marketing Center at the University of Oregon, said major brands like Best Buy have gotten "better and faster" on how to best use their sponsorships, especially given the weak economy.
Best Buy's partnership with Roush "can be a great example of a how a sponsorship is all about awareness and consumer appeal" instead of selling stuff, Swangard said.
At the same time, a major victory like the Daytona 500, long considered the Super Bowl of stock car racing, presents Best Buy with some unexpected opportunities that "you'd be crazy to ignore," he said.
The retailer should therefore get the most out of its Daytona 500 triumph, Swangard said.
"Roush didn't trade a sponsorship for a couple of plasma televisions at a Best Buy, I can tell you that," said Swangard, noting that a major NASCAR sponsorship easily runs into millions of dollars.
Panayiotou admitted that this year's Daytona 500 caught the retailer a bit off guard. The race, which was delayed twice because of rain, did not finish until shortly before midnight Central time Monday.
Best Buy didn't issue a news release acknowledging the victory until Tuesday afternoon.
"I wish the race ended earlier," Panayiotou said. "But we're now moving as fast as humanely possible" to seize the moment.