NASCAR announced on Thursday, December 1, 2016, at Wynn Las Vegas a multi-year deal that will make Monster Energy only the third entitlement sponsor (RJ Reynolds/Winston and Sprint/Nextel) in premier series history. The length and terms of the deal were not disclosed, but both parties hailed the partnership as the perfect fit for both brands.
Sprint announced in December 2014 it would not return after the 2016 season, and NASCAR has spent nearly the past two years searching for a replacement.
Coming down to the wire to get a sponsor for 2017, NASCAR needed a sponsor if it didn't want to foot the bill for what the sponsor contributes to NASCAR as well as marketing the sport.
Past sponsors R.J. Reynolds, Nextel and Sprint spent tens of millions of dollars promoting the sport. When Nextel signed its deal in 2003, it was reported its total spending was approximately $70-75 million a year.
Sprint (which assumed the sponsorship through its Nextel merger) renegotiated its deal when it signed an extension for 2014 to 2016 that reports have pegged at closer to a $50 million minimum annual commitment. It also sponsored two exhibition races -- the preseason race at Daytona and the all-star race at Charlotte.
Monster will sponsor the all-star race at Charlotte this season.
A powerful force in the energy drink category and owned 16.8 percent by Coca-Cola, Monster Energy turned a $546 million profit in 2015.
Monster has been involved in NASCAR for several years, currently sponsoring Kurt Busch and previously his brother Kyle. Kyle is sponsored by Nos, which is owned by Monster Beverage Company, in the Xfinity Series. Monster also has been involved in motorsports by sponsoring the Supercross
"Monster Energy is a brand built on excitement and enthusiasm, qualities that align with NASCAR," said Brian France, NASCAR Chairman and CEO. "This sponsorship position is the most unique in all of sports and entertainment, and we are thrilled to have a partner that will help us further elevate the series. Today's announcement is the culmination of a thorough search, one that resulted in the right partner at this important time in our sport's history."
Monster Energy has existing sponsorships with a number of motorsports sanctioning bodies, athletes and teams, but the NASCAR deal signals the biggest sponsorship step in the company's history. "Monster has built its brand on racing and motorsports, and NASCAR is the pinnacle of motorsports in America," said Mitch Covington, vice president of sports marketing at Monster Beverage Company.
"It's American racing; we're an American brand that's a global company, and NASCAR is, too. When the opportunity came along to further associate yourself with a sport like NASCAR, it was the perfect fit for us. ... NASCAR is just a hard-hitting, close-racing, fun property to be associated with."
Along with naming rights to NASCAR's top series, Monster Energy will also hold race sponsorship to the NASCAR All-Star Race and become the Official Energy Drink of NASCAR. Monster Energy also said it will continue to sponsor Stewart-Haas Racing's #41 Ford of Kurt Busch.
Thursday's announcement is the culmination of a lengthy and thorough search by NASCAR to find the successor to Sprint, whose entitlement sponsorship will end on December 31, 2016. Steve Phelps, NASCAR executive vice president and chief global sales and marketing officer, said that the sanctioning body spoke with numerous companies throughout the process, ultimately choosing Monster Energy for a number of reasons, not the least of which was its lifestyle culture.
"We have the good fortune of finding a brand that we believe works for our sport," Phelps said. "They're going to bring their lifestyle to their activation. ... They're going to bring their brand, their excitement, their energy to this partnership, and the fans are going to be the winners.
It's all about engaging the fans and having the fans have unique, fun experiences whether at the race track or through different mediums, through social, digital, content." Phelps said a number of ancillary details will be announced in the coming weeks. Among those still under discussion is the name of the series, the series mark and the championship trophy. Under the agreement, energy drink sponsors already involved in NASCAR may remain in place. Potential sponsors from the energy drink category will not be eligible for future sponsorship if not already involved in the sport.