GEICO gets hip to Versus

Back in mid-season, Paul Tracy told Robin Miller that GEICO was not hip to Versus.

Apparently, the truth is that GEICO is not hip to the IRL on Versus. When the cable carrier has programming that its exclusively U.S.-based audience wants to watch, then GEICO is very hip to Versus.

Case in point: Versus is televising The Big Game - Cal at Stanford - tonight. Promos throughout the first half have encouraged college football viewers to stick around for the GEICO Halftime Show.

Roggespierre

IndyCar: Little Hope for Tracy in 2010

KV Racing Technology owners Jimmy Vasser and Kevin Kalkhoven clearly would like to add a second car in 2010 with Paul Tracy behind the wheel. The problem, of course, is money. Adding Tracy to its roster of drivers would be good for the IndyCar Series. The Canadian veteran is talented, experienced, and candid. Unlike several of the league's drivers, Tracy also happens to be interesting.

Will in absence of Value

GEICO, a subsidiary of Warren Buffet's Berkshire Hathaway, has become a fan of Tracy and the KV team. According to Robin Miller, the auto insurance marketer will provide some sponsorship again in 2010, but only for the races that are broadcast on network television.

The IRL is unlikely to embrace the idea of canceling its Versus contract and incurring a net loss of at least $7.2 million. That's what it would take to move eight races to a network broadcaster and four more to a high-reach cable channel. The increase in promotional inventory capacity to Tracy and KV Racing Technology would be roughly $743,000. Add that to the roughly $1.3 million in existing promotional inventory capacity, and Tracy could expect to have half of the budget required to field a shoestring effort.

Such is the economic reality of IndyCar racing.

Tracy has few options, none of them particularly promising. They include:

1. Work with Vasser and Kalkhoven to attract small sponsors that might collectively make-up the $2.0 to $2.7 million gap. This requires tremendous effort and offers a low probability of success.
2. Find an idiot who is willing to pay double market value for sponsorship. It's been done before. But marketing is now a spreadsheet-driven, quantitative quasi-science. Finding fools is increasingly difficult.
3. Hope that Terry Angstadt can line up a Brazilian widget maker that happens to sell something that GEICO has to buy. Supply chain arbitrage saves the day!
4. Pay for the ride out of his own pocket. This is not only expensive, but also degrading. Paul Tracy is an accomplished talent. He has won races and a championship. He is not some kid with either rich parents or a Sugar Daddy Socialist in his corner, and he should not be required to behave like one. Tracy also happens to be a professional racing driver. That implies that he gets paid to drive, and not the other way around.

When will the IRL adjust its cost-to-value ratio so that real, professional racing drivers like Paul Tracy and Buddy Rice, as well as promising young talents like J.R. Hildebrand and Jonathan Summerton, can participate? The IndyCar Series needs drivers who can be sold to a very large audience. The present group of drivers has failed, Versus or no Versus.

The 2010 prospects for Tracy and KV Racing Technology are not good. Expect them to run Indy and a few additional races together, much like they did this season. Anything more would require either a minor miracle or compulsory consumption of Brazilian beef at the GEICO employee cafeteria.

Roggespierre