Academic journal article Business Case Journal

High-Speed Success in Indy Left Canadian Club Wondering, "Should We Stay or Should We Go?"

Academic journal article Business Case Journal

High-Speed Success in Indy Left Canadian Club Wondering, "Should We Stay or Should We Go?"

Article excerpt

2007: A Tough Marketing Decision

Dennis Prado, Senior Brand Director of Canadian Club Whisky, sat at his desk in September 2007 overcome by the success experienced by the brand in the prior nine months. The Canadian Club brand had completed a second season as a major sponsor of the Andretti Green Racing IndyCar team's number 27 racecar driven by Dario Franchitti. This sponsorship formed the foundation of Canadian Club's integrated marketing communications (IMC) strategy since 2006. Franchitti exceeded everyone's expectations by winning the Indianapolis 500, the premier race of the Indy Racing League (IRL), the largest single-day sporting event in the world. Franchitti then continued his hot streak throughout the season and ultimately won the 2007 IRL Championship, the highest honor that can be achieved as an IndyCar driver. The career-high successes that Franchitti experienced throughout the season had resulted in Canadian Club's $6 million sponsorship investment returning approximately $36 million (2007 Year-End ROI Report, 2007) in Canadian Club exposure value. That was an ROI of over 500%.

Prado focused on the dilemma which was at hand: he had recently learned that Franchitti would not be racing in the 2008 Indy Racing season because he signed a contract with NASCAR. That meant Canadian Club had a very important decision to make: Should it follow its wonder boy to NASCAR or should it try to find a new driver on the Andretti Green Racing team to sponsor? Or should Canadian Club abandon its racing program altogether and start anew? Two years and millions of dollars had already been invested in Canadian Club Racing. Prado understood that long-term continuity was vital for the success of a major sports sponsorship by a consumer brand. As time ticked by quickly, Prado and his brand team knew they had to make a decision about where they would take the brand entering 2008.

Background of How Canadian Club Racing was Born

Canadian Club was the number two Canadian whiskey in the world when Beam Global Spirits & Wine acquired the brand from Allied Domecq in 2005 (Fortune Brands news release, 2005). As the new senior brand director, Dennis Prado inherited the first national Canadian Club marketing program that the brand had seen in over a decade. The program, which had been launched by Allied Domecq, sought to reach the untapped demographic of males, age 25-39, without alienating Canadian Club's core consumer, males age 45+ (D. Prado, personal communications). This first program was short-lived, however, due to budget constraints and execution flaws. As Prado settled into his new role, he began contemplating a replacement marketing program for the quickly approaching 2006 year.

About the time Prado was trying to determine the short-term future of Canadian Club promotion, another Beam Global brand, Jim Beam, had signed a commitment to undertake an IndyCar Series sponsorship of Dario Franchitti, a racecar driver on the Andretti Green Racing Team. However, after making the commitment, Jim Beam brand marketing managers altered their strategy and decided to place their sponsorship investment into NASCAR, which they felt was a better fit for the parent brand. Prado and the director of Jim Beam Racing, Brian Gallagher, began holding discussions centered on the possibility of Canadian Club taking over the Indy Racing League (IRL) sponsorship. This arrangement would allow the Jim Beam brand to reallocate its sponsorship resources solely on NASCAR. And, for the Canadian Club's brand, the sponsorship cost for INDY was within budget. Soon, Jim Clerkin, President of Beam Global Spirits & Wine, North America, was brought in on these discussions. Clerkin became very enthusiastic about the opportunity and shared his enthusiasm with Prado:

Dario is handsome, suits [Canadian Club's] desired profile, works great with sponsors, and most importantly, he is a winner! We need to start winning again with Canadian Club! …

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