Inside NASCAR: Most popular driver establishes model
Dale Earnhardt Jr. once said if you can have a good time doing business and break even you're doing well, but if you're not having fun you better be making some money.
Needless to say, the scrawny towhead kid from Kannapolis, N.C., raised on simple family values is having his cake and eating it, too; Earnhardt is having a blast and making too much cash to count.
The 34-year-old community-college graduate is a proven entrepreneur and can walk into a boardroom with the same confidence and passion he carries climbing into the driver's seat of a race car. He forges multi-million dollar partnerships and signs NFL-sized endorsements all while chilled out in a pair of jeans and the shelltoe adidas Superstars.
Earnhardt's face is virtually on every purchasable product in America from candy bars to clothing. Be it a Dale Jr. binky or a Dale Jr. garden accessory, the selection is so vast you could furnish your entire house with his likeness. He controls 40 percent of the marketplace for licensed product sales for NASCAR drivers and sold at least 20 million units last year.
But Earnhardt set a major tone for his business future and career in 2007 when he opened up the JR Motorsports shop in Mooresville, N.C. Housing not only his Nationwide Series team but his licensing, marketing, fan and brand initiatives, the building is 66,000 square feet of massive venture space. All while keeping the Earnhardt business model at the forefront: authenticity, common sense and a strong handshake. These are all the tools on which Junior relies to run his business empire.
"Heads will roll. No, that's my motto at JR Motorsports," laughed Earnhardt, waiting to answer dozens of reporters at Daytona International Speedway. "Heads will role, that's what we like to say."
Hardly. A narcissistic dictator is far from Earnhardt's in-the-office demeanor. His employees say he handles the day-to-day pressures with a "laid back grace" and maintains the down-to-earth persona fans have grown to love since the driver appeared on the NASCAR scene nearly a decade ago.
"They know I'm just a normal damn dude. I can't fool them," said Earnhardt, who just like his father wanted to pursue his own business. Both began their ventures through team ownership and grew their brands through marketing, endorsements and licensed merchandise.
Now, Earnhardt is expanding his portfolio into assets he knows will be around long after he retires from racing. It's a thought the driver is not fond of as the pressure and desire to win a Cup title is top of mind, but so is the future of JR Motorsports and the opportunities to follow.
Among the first has been Whisky River, Earnhardt's signature nightclub that opened last spring.
"It's more successful than I anticipated by three or four times. I had a pretty good idea where I felt like I was going to be but it just quadrupled," Earnhardt said of the club's overnight popularity in Charlotte's uptown.
A contracted management team runs the 10,000-square-foot watering hole where country stars and athletes come to play, but Earnhardt himself likes to keep his hands on the direction and feel of the club.
It's a direct reflection on Earnhardt's eclectic style and broad sweeping tastes. The ambiance inside is comparable to a scene from Urban Cowboy only updated with a uber modern décor and the swanky offerings that today's comforts demand.
"I think I enjoy the bar the most. I'd always wanted to get involved in ownership of a nightclub of some sort, because I really enjoy the entertainment side of it and I enjoy the camaraderie," Earnhardt said. "It's kind of fun to be there and to see the employees working and see them taking pride in what they're doing, the meetings they have after every night, hearing everybody, how uniform everything is, how structured it is.
"I take a lot of pride in it."
Pride in his work is what also led Earnhardt in 2006 to create his own production company, Hammerhead Entertainment. It's a small, unimposing building surrounded by woods and an unexplainable number of souped-up cars, but inside shows like Back in the Day and Shifting Gears are produced.
Taking a cue from John Madden's playbook, Earnhardt formed the production company to maintain more control over his footage and content in light of numerous video and commercial projects the driver performs each season.
"It was also a way to have direction over the production of footage. He loved watching Back in the Day and wanted to bring it to life and he did the pop-ups. That was his idea. Through Hammerhead, the production crew scripts it out so from a creative standpoint it's all Hammerhead and Dale Jr.," said Kelley Earnhardt, president of JR Motorsports.
"Dale doesn't attempt anything unless he is passionate about it. He can't script or make up anything. He is as real as they come."
Earnhardt also has real estate interests. Besides owning a company, he also has partnerships in two tracks: one in Paducah, Ky., and another in Mobile County, Ala. The Alabama Motorsports Park is under construction and boasts three racing venues: a road course, a karting track and an oval track that's being branded "A Dale Earnhardt Jr. Speedway." Gates at the 2,400-acre complex are expected to be fully operational by 2011.
"Having the right people in the right place to handle the business side of it, because, I mean, I like to do different types of things, but to be honest, my business experience isn't as good, I guess, as my racing experience," Earnhardt admits. "I have to lean on a lot of people, lean on some people's judgment. You put good people in the right place; they'll run those types of deals for you, where you can focus on the racing."
Kelley Earnhardt is her younger brother's counselor in all things professional and personal. She is the one woman that can keep him balanced between his two worlds: Dale Jr. the driver and Dale Jr. the entrepreneur.
Kelley, who left her career in the licensing industry and took a major pay cut to help Junior in 2001, oversees virtually every contract, project, agreement and appearance Earnhardt makes.
"My role grew," she said. "I almost see us as Siamese twins locked at the hip. I'm the one who carries it through and sees it through, because we want him to be able to concentrate on being able to drive."
But the balancing act begins on Tuesday.
"I try to give him Mondays to get back into this world, our world at JR Motorsports; we don't schedule anything for him on Mondays. And when he is at a race track we try not to talk about business of any certain kind," Kelley said. "We conduct our business during the week, Tuesday and Wednesday, so he has the ability to concentrate on racing."
Operating as two different entities can be a challenge and the hats Earnhardt wears tend to stack up and even topple over at times.
"Well, you sort of go into it real easy, I guess. I don't know," Earnhardt said. "When I first started doing any type of business venture, even if it was really small, you know, you really worried about how it might affect the driving, because the driving is my real passion and that's what I really like to do. I don't want to affect that in any way, because I want to do that as long as I possibly can. You go into it slow and you learn."
Thayer Lavielle, vice president of marketing and brand development for JR Motorpsorts, was hired in 2007 to grow and manage Earnhardt's image and steer the brand in the right direction.
"I represent more work to him. At the end of the day, it's a joke; I have a pile of work for him every time he comes in. With that, he's itching to get out of my office and spend hours in the shop with the guys. He and I figured out a way to work together quickly and I understand what makes him tick," said Lavielle, who along with Earnhardt formed the partnership with adidas and the personal clothing line.
"We sort of have a tug of war, me and her," Earnhardt said of Lavielle. "She comes up with some great ideas, things that we need to do, some areas that we may have opportunities in, success in. She doesn't really try to change the perception of me and what I think I am, what I like to do, what I like to be, how I like to act, what I choose."
Partnering with brands and companies that are true to Earnhardt and his persona is Lavielle's main mission, as well as taking the driver's brand into the future, which means reaching the youth fan base.
"We already have a lot of product for kids, but this will be beyond licensed products. We have a lot of different outlets and our own fan club," Lavielle said.
"One of the things that is exciting for her, in our sponsorship change in the last year, we're able to drive down a lot more avenues, do a lot more things, especially with the younger adults," Earnhardt said. "So that's exciting for her and we're working in that area a little bit. But for the most part, me and her have a lot of fun. You know, she's definitely a big asset to our company."
Another asset to Earnhardt's business plans was the 2007 hire of Joe Mattes, who as vice president of licensing at JR Motorsports oversees any and every piece of merchandise with Junior's name or likeness on it. From the tiniest No. 88 earring to the largest two-person tailgating chair and matching tent, Mattes manages and promotes the sale of these items with Earnhardt's approval and input.
Mattes first worked with the family in 1995, helping Dale Earnhardt plan, build, and launch his first souvenir company, Sports Image. He knows how great the demand is for the Earnhardt product and respects the position in which Junior finds himself.
"We have to keep in mind it's a business, a privilege and responsibility that commands such a significant part of the marketplace, your decisions affect the sport in total," Mattes said. "We also understand we have a responsibility to his sponsors and car owner. Dale Jr. sets the tone."
And that tone for this season is being mindful of the economic hardship NASCAR fans are enduring, Mattes said. Products are going to have to be functional in terms of lifestyle products.
"We are concentrating on functional licensed products that makes sense for day-to-day needs," he said.
The changing market and climate of NASCAR is something Earnhardt must always be aware as each of his business ventures is always tied to his racing career.
One might think it takes two very different people to be Earnhardt the entrepreneur and Earnhardt the driver, but really he is one in the same person and operates as such, Kelley Earnhardt said.
"He just slides in as Dale Jr. for whatever it is and wherever he is," she said. There are times when two or three different things are going on, a meeting with Big Mo' candy bar and then something else for adidas and he doesn't change. He's very adaptable, he's just Dale Jr."
Mattes said it's a trait all successful businessmen possess and one he saw in Dale Earnhardt.
"It's the Earnhardt factor. [Junior] does everything right," Mattes said. "He and his sister, Kelley, they've made the right decisions. They've been careful and done the right things."
More than that, Earnhardt said, "When you're a businessman you have to make decisions based on common sense and not emotion. It's so easy to choose something on an emotion."
When his business began with just one street stock car at Concord Motorsports and the shop was in his backyard, it didn't matter.
"When I started things, I could choose everything on emotion, because there were no real repercussions if I failed or if the company failed because we were so small. Well, now we are so big, you can't take those chances," Junior said. You have to choose wisely."
Choose wisely and remember "impossible is nothing."
"Once you get the ball rolling," he said, "the thing pretty much takes care of itself."
