Aflac upgrades its NASCAR sponsorship

After a couple of years of being something of a “back-seat” driver, with an associate sponsorship of NASCAR driver Carl Edwards, the Aflac duck is going full throttle.

The Columbus-based supplemental insurer this year inked a deal for full sponsorship of Edwards, his racing team and the No. 99 Ford Fusion Edwards will drive for 38 races in the Sprint Cup Series.

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Aflac’s new deal puts it in one of the prime advertising spots on Carl Edwards’ Ford Fusion.

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Associated Press

Carl Edwards is a popular driver among NASCAR fans, known for doing a back flip after winning races.

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Aflac’s white, fluffy-feathered mascot has become a marketing icon in its own right, helping the company connect with consumers.

And while NASCAR has legions of dedicated fans, the primary focus of Aflac’s interest is other corporate sponsors involved in the sport.

“Any sponsorship we do, we have to look at the investment we’re making and what it yields,” said Keith Farley, Aflac’s manager of corporate sponsorships. “We’ve seen the power of NASCAR and the relationships we can build.”

Connecting with other corporate sponsors — the Subway fast food chain for example — is key to Aflac’s business development strategy because most of the company’s insurance policy sales are made through employers.

“We are in this for the business-to-business relationships,” Farley said. “When you look at a program like Subway with 30,000 franchise locations, this is a company where there’s a business relationship opportunity.”

So, executives reason, getting to know the corporate gatekeepers is crucial to getting inside and NASCAR provides the best opportunity. Indeed, NASCAR boasts that 117 of the Fortune 500 companies have some investment in its races, more than any other sport.

The push comes at a time when Aflac’s business is facing some strong economic drag.

Earlier this month, Wal-Mart Stores, the world’s largest retailer and Aflac’s biggest account, said it was not renewing its contract with the insurer when it expires Dec. 31.

Aflac shares also have been under pressure — shedding 70 percent in the last year — and several analysts downgraded the company stemming from its investment portfolio’s exposure to hybrid debt securities issued by European banks. The company’s two markets, Japan, which accounts for roughly three-quarters of business, and the United States are in deep recessions.

While Aflac sponsors other sporting related events such as its Iron Girl competition and the high school baseball All-American game, the NASCAR focus is the company’s largest.

“The investment that we’ve made — we’ve seen a positive return,” Farley said, explaining the company reaches firms of all stripes and sizes because races are held all over the country. “That’s why we’ve increased the investment because the return has exponentially increased.”

Aflac would not disclose how much the sponsorship is costing, but Paul Sickmon, owner of Knox Sports Marketing, a Tampa, Fla.-based firm that specializes in the segment, estimates such deals can fetch anywhere from $20 million to $90 million.

And even though the primary motivation behind emblazoning its blue logo is to develop new and strengthen existing business relationships, the sport’s popularity with the fans helps in that effort, too, Sickmon said.

“It creates legitimacy behind the brand,” Sickmon said. “When Aflac calls on you as a potential customer, you haven’t hung up yet because you recognize the name and the brand.”