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Motorsport Sponsorship Trends and Statistics You Can’t Miss

by | March 6, 2024

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Before you dive in, if you are interested in motorsport sponsorship, check out these titles in our “sponsorship for motorsport” series:

Are you a motorsport athlete or organizer who’s ready to open the door to sponsorship? That’s a wise call, as motorsport sponsorship is on the precipice of even more massive growth than it’s already experienced. 

As you begin ideating motorsport sponsorship activations and searching for sponsors, keep this information in mind. It can guide your decision-making. 

Motorsport Sponsorship Will Break the $4 Billion Threshold by 2027

The motorsport sponsorship market is as healthy as it’s ever been, with Industry Arc projecting an even more robust future. Between 2022 and 2027, the compound annual growth rate or CAGR for motorsport sponsorship will hit 9.7 percent.

There’s even more good news, with Industry Arc predicting that the industry will achieve $4.1 billion in revenue by 2027. 

Industry Arc attributes several causes to the popularity of motorsports in the sponsorship market, including a growing millennial audience due to social media and motorsport broadcasting, Formula 1’s meteoric rise to the top (and the revenue it brings with it), and electric vehicle racing. 

Increased safety regulations also make major brands more comfortable investing in motorsports. 

Europe Has the Biggest Market of Motorsport Sponsorships

If you had to guess which country had the highest market share of motorsport sponsorship, would you assume it’s the United States? That’s usually a safe guess, but in this case, it’s incorrect. 

Industry Arc reports that Europe has the largest subset of motorsport sponsorships as of 2021, with a share of 42 percent. Coming in second is North America at a rate of 26 percent, then Asia Pacific at 22 percent. 

Short Contracts Are on the Rise 

Sports sponsorships are popular for their multi-year, multi-billion-dollar deals. While the latter certainly isn’t going anywhere, the former is. Trends from the past couple of years are pointing toward a reduction in contract length.

It used to be that deals that extended at least five years were the standard, sometimes double that. However, now, it’s more common for brands to pen motorsport sponsorship deals that last a year or two, tops.

So, what’s with the change? Are companies that unhappy with the organizations, teams, and racers they sign?

No, it’s nothing like that at all. Instead, brands are doing it to protect themselves. They understand that consumer preferences can change, even among fans, and so shorter-term deals allow companies to stay abreast of those changes without getting stuck in a deal they perceive is too long. 

Additionally, the companies that provide sponsorship have more flexibility by offering short-term deals, allowing them to adapt to industry changes as they arise. 

However, the short end of the stick goes to motorsport organizations, teams, and racers. These short-term deals mean more time spent looking for sponsors, a task they’ll have to resume every year or so. 

Of course, be aware that short deals aren’t the case across the board, as NASCAR has recently (as of 2023) secured a seven-year sponsorship deal with Discovery valued at $7.7 billion.  

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Race Series Sponsorship Is Poised for Growth

In analyzing the types of motorsport sponsorship that yield the biggest market segment, Industry Arc’s data reports that race series sponsorship gets the lion’s share. Its CAGR is projected to hold steady at 8.2 percent between now and 2027. 

Race series include NASCAR Infinity, Formula E, and the F1 Grand Prix. Sponsors have many opportunities for meaningful activations and assets at a race series, from event naming rights to booths, free samples, contests and giveaways, and VIP areas. 

F1 Is the Most Popular Motorsport for Sponsorship

The very European Formula 1 has striven to break into the North American market, and so far, it’s working. 

While F1 hit a speed bump in late 2023 with a viewership decline of eight percent, it wasn’t Formula 1 specifically. NASCAR saw its viewership sag by five percent, although it still collected major sponsors like Warner Bros., NBC Sports, Fox News, and Amazon. 

Besides, some of F1’s 2023 races had the most American viewership yet. Its Canada race attracted 1.76 million viewers, the Monaco race 1.79 million, and the Miami grand prix had a huge viewership surge with 1.96 million viewers. 

But It’s Also the Most Expensive

While F1 is having a banner experience, its expansion means that securing a deal with the European racing organization is getting increasingly costlier. That’s why you’re seeing a higher rate of big-name brands signing up for long-term sponsorship deals. as they’re the only ones who can afford the prices.

It’s not solely Formula 1 that’s expensive, although they do cost the most. NASCAR, IndyCar, Formula E, and MotoGP are also pricy. For example, MotoGP has a deal with Monster Energy, no small brand (and no stranger to motorsport sponsorship, either!). 

Digital Activations Rule the Day 

Unsurprisingly, digital activations and assets are entering the motorsport sponsorship sphere at an increasing rate. This isn’t limited solely to motorsports or sports in general; almost every industry has seen a move toward digital sponsorship services.

There are plenty of compelling reasons for why that is. For starters, digital activations can be cost-effective. Besides that, there is also more room to make the activations feel larger than life, which is critical in an increasingly competitive motorsport sponsorship market saturated by big names. 

Trends like VR, AR, and AI expand the parameters of what’s possible. Advantageously, it’s easier to cull meaningful data about a sponsorship opportunity from digital activations and assets. 

The Motorsport Audience Market Is Becoming More Diverse

I mentioned earlier that one of the reasons motorsport sponsorship is on the rise is because it’s attracting an increasingly younger audience. Indeed, ESPN Press Room notes that 521,000 more viewers per F1 race between 18 and 49 tuned in.

I recognize that’s a large audience subset, so let’s break it down. Viewership among younger audiences rose in 2022, with 49 percent more viewers between 12 and 17 years old watching than in 2021 for a total of 36,000 viewers in that age bracket for each F1 race. 

The 18-to-34 camp had 238,000 viewers a race on average, which was a huge jump of 43 percent compared to 2021 numbers. 

Viewers ages 25 to 34 comprised 169,000 people per race, making up 28 percent of the overall audience. That’s a 34 percent increase in viewership for this age bracket than 2021’s numbers. 

Women also watched F1 more feverishly, with 352,000 ladies tuning in throughout the 2022 racing season, making up 28 percent of the overall audience. The viewership was up by 34 percent versus 2021 numbers. 

There Must Be Considerations for How Motorsport Sponsorship Impacts the Environment

One of the most important considerations brands have when partnering with a motorsport organization, its teams, or its drivers is environmental impact. 

As great as racing is, it’s no secret that it’s not the most environmentally friendly sport. Racing creates noise and air pollution, especially carbon dioxide. Industry Arc cites a report from the International Automobile Federation that found that F1 generated 1.9 million tonnes of carbon dioxide a year as of 2019. 

This isn’t all F1’s doing; fan transportation to and from races also contributed to the tally. 

That’s why Formula E has such a fighting chance as a motorsports organization right now. This electric vehicle-based racing league is far better for the environment. 

So, what does this mean for other racing organizations like F1 or NASCAR? They might eventually make the jump to electric vehicles, but if and when that would happen is impossible to say. 

In the meantime, if you’re courting a sponsor as a motorsport organization, you must have a contingency plan for minimizing waste. Brands don’t want their names associated with companies that create a lot of carbon dioxide and are otherwise horrible for the environment. 

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Even if you can’t change your fuel source tomorrow, you can acknowledge the carbon footprint you have and begin actively mitigating it. 

Wrapping Up 

Motorsports has left its mark, culminating in one of the fastest-growing sports segments on the market. Despite that, shorter-term deals are in vogue, although they often fetch a lot more money, especially if working with an F1 team or driver. 

Another major consideration is sustainability in motorsports, which is easier said than done. Having a plan can assuage your sponsor’s concerns and help you get a deal going forward.