The sponsorship snafu that could lead to Danica’s downfall
By Taylor Goins
February 12, 2017
For once, the biggest soap opera in America isn’t on CBS daytime television.
Instead, it’s taking place in Kannapolis, NC and Reno, NV, the respective homes of Stewart-Haas Racing and Nature’s Bakery.
On January 19th, Nature’s Bakery (former sponsor of Danica Patrick’s No. 10 Stewart-Haas Ford) sent Stewart-Haas a letter terminating their sponsorship agreement, to be effective immediately.
Nature’s Bakery had signed a three-year deal with SHR in 2016 and was entering the second year of the deal in 2017. However, the sticking point of this for SHR is simple: when terminating the sponsorship agreement, Nature’s Bakery had already missed several scheduled payments and was effectively walking away from the $31 million that it owed the race team.
As one would expect, SHR took the next step and filed a $31 million dollar breach of contract lawsuit against Nature’s Bakery on this past Friday, February 3rd. Stewart-Haas, in a team release, claims that “Nature’s Bakery is in material breach of its contract with Stewart-Haas Racing. It is an unfortunate situation, as the team has delivered on all aspects of its contract and was prepared to do so again in 2017. Ultimately, this is a situation that will be resolved in a court of law.”
It’s hard to argue with anything SHR claims, but Nature’s Bakery has put together a defense for their reasons for backing-out of the sponsorship agreement.
The Nevada-based health-oriented baked goods company claims that Patrick had been advertising “competing products” on her various social media accounts.
However, this accusation is flimsy at best, as Nature’s Bakery states that one of the “competitors” that Patrick was promoting was “Six Star Pro Nutrition Protein Powder,” which is hardly in a market-share battle with the fig bars and brownies that Nature’s Bakery sells.
Moreover, Nature’s Bakery even “liked” several of the social media posts that they are now citing as reasons for breaking the sponsorship agreement.
When looking at the big picture, it’s understandable. Nature’s Bakery is a small company (with less than 500 employees) and ran into cash-flow issues not long after signing-up to sponsor Patrick’s ride.
They took a gamble, hoping to win big if Patrick had a breakout season and therefore see exponential returns on their investment. Unfortunately, that did not work out, as Patrick had a middle-of-the-road 2016 season, gaining no top-ten finishes and an average finish of 22nd.
Let’s be honest: Patrick didn’t do anything wrong to cause Nature’s Bakery to end the sponsorship, but the snack food company bit off more than it could chew and had to find a way out.
However, even though this latest drama isn’t Patrick’s fault, it certainly does spell big-time trouble for her future in NASCAR.
Nature’s Bakery was Patrick’s main sponsor for 2016 and had signed on for 20 more races in 2017. The $15 million dollar sponsorship tab that is being left vacant will have to be picked up by someone, and unless Patrick quickly secures a replacement sponsor, the person left footing the bill will likely be car owner Gene Haas.
Haas, billionaire founder of Haas Automation (a CNC machine tool manufacturer), has paid from his own pocket to sponsor cars that he owns in the past.
However, three of his four cars in the Monster Energy NASCAR Cup Series do not have full slates of outside sponsorship. With rising costs to run a race team, one has to wonder how long Haas will be content writing checks to cover sponsor-less cars.
If not corrected soon, this lack of sponsorship will likely be Danica’s downfall in NASCAR. It’s no secret that Patrick has done great things for the sport. As NASCAR’s first top-series full-time driver, she has brought in droves of new fans and positive exposure for everyone involved in the sport.
Popularity has never been Patrick’s problem, as evidenced by the fact that she won the Sprint Fan Vote to get into NASCAR’s All-Star Race three times out of four attempts.
Instead, the problem for Patrick lies elsewhere: on the track. In five seasons in NASCAR’s top series, Patrick has yet to record a single top-five finish and only has six top-ten finishes to her credit.
Given that she has one some of the best equipment in the entire series, those results alone cannot be enough to satisfy decision makers at SHR.
Instead, what has kept Patrick out of the silly-season fray has been her marketability and her ability to attract sponsors and bring money to a race team. One hopes that this is just a blip on the radar for Patrick, but the trend seems to be troubling. Long-time sponsor GoDaddy (who sponsored Patrick first in the IndyCar Series and then in NASCAR since 2010) left after the 2015 season, and now Nature’s Bakery is breaking ties with the No. 10 team after just one year.
One has to believe that the 2017 season is a make-or-break campaign for Patrick. If she doesn’t deliver a sponsor or the kind of results expected for the top-flight ride that she has, SHR may be tempted to bring in a driver capable of winning races on a weekly basis.
It’s unreasonable and unfair for Haas and his CNC machine sales to cover multiple seasons worth of unsponsored races for average finishes in the mid-20’s.
In NASCAR, you have to be able to do one of two things: win races or bring in money. Unfortunately, Patrick is not doing either at this moment in time.
DISCLAIMER: Opinions expressed are solely those of the writer.