What’s Wrong with this Picture?

February 13, 2009


Starting on Sunday with the Daytona 500, the #31 car of Jeff Burton will be sponsored by Caterpillar. For the past ten years, Caterpillar has been the primary sponsor for the #22 car. So for the past ten years, CAT has been pouring money into NASCAR to have its logo on the hood of a car.

What’s wrong with that?

Caterpillar just announced the other day that it will be laying off 20,000 workers in the coming months. 20,000 jobs will be lost but Jeff Burton will have their logo on his hood come Sunday. I don’t know much about NASCAR sponsorship costs but we’d have to assume to be the hood sponsor, it’s not cheap. Probably several million dollars. Wouldn’t it make sense for that money to be saved and given instead to some of those employees so they can keep their jobs.

The argument for sponsoring a sports stadium, NASCAR team, sporting event is that you put your brand out there for everyone to see and people remember your brand later when it comes to making decisions on items to purchase. Well Caterpillar has been sponsoring cars for seventeen years yet over the next few months they’ll still have to lay off 20,000 employees? Doesn’t it seem like that advertising strategy hasn’t been working enough to justify the cost?

Of course CAT will never end a car sponsorship if they can help it. And for some reason that’s ok. Same with Citi Field in New York or Bank of America Stadium in Charlotte. The reality is that today those names are kind of a joke. A punch line and a reflection of disaster, not constant adverts. They’re fast approaching Enron Field status.