How the business savvy of Dale Earnhardt built a marketing empire for NASCAR stars
NBC Sports will take a look at the life, legacy and long-lasting impact of Dale Earnhardt who died 20 years ago this week on the last lap of the 2001 Daytona 500 on Feb. 18, 2001. This is the third chapter in an oral history series that remembers “The Intimidator” though the voices of those who knew the seven-time Cup Series champion who remains one of the biggest icons in NASCAR history.”
Adjacent to the “deerhead shop” – an aluminum-sided inner sanctum of race cars surrounded by its owner’s trophy hunting-covered walls – Dale Earnhardt’s business empire started at a square maroon desk.
When Don Hawk joined Dale Earnhardt Inc in 1993 to help manage the appearances, branding and commercial opportunities for the seven-time NASCAR champion, his office primarily was in a converted brick farmhouse on Earnhardt’s sprawling property in Mooresville, North Carolina.
It’s where many major decisions were made by Earnhardt and his wife, Teresa, that charted the transcendent superstar’s course as a nine-figure marketing machine whose reach rivaled that of the most popular personalities in other professional sports.
ESSENCE OF THE INTIMIDATOR: What Dale Earnhardt meant to people
‘THE TWO DALES’: Drivers recall what it was like racing the seven-time champion
“I remember Dale and Teresa asking ‘What are we going to do that’s different?’ ” Hawk told NBC Sports. “I said, We’re going to market Dale Earnhardt as an athlete, not a race car driver.’
“The perception in’93 was that we were a barefoot, bib overall, redneck sport. That we had this whole reputation of being backward in business. What I saw in Earnhardt, once I traveled with him and watched the fan interaction, he was the Michael Jordan, Wayne Gretzky, Arnold Palmer and Jack Nicklaus of his sport.”
Like those icons, Earnhardt became a household name in part from myriad multimillion-dollar endorsements that aligned him with ubiquitous trademarks ranging from fast food (Burger King) to toys (Hasbro) to beverages and snacks (Coca-Cola and Nabisco). Hawk said Nike founder Phil Knight had an autographed framed photo of Earnhardt, showing off the Swoosh on his shoes after winning the 1998 Daytona 500, prominently featured at company headquarters.
But aside from expanding NASCAR’s footprint beyond endemic racing-oriented sponsorships, he also built a financial and licensing model for his peers to follow as merchandise revenues from diecast race cars and other souvenirs ballooned (Earnhardt’s Sports Image company licensed and sold his merchandise in trailers at the track).
“It was huge; he was really good at marketing and merchandising,” NASCAR on NBC analyst Jeff Burton said. “He gave me advice that, ‘The most important thing you have is your name. Don’t ever give anyone the rights to your name.’ And he really thought about the business side and how to utilize the work he had done to build the name he had. Those were important to him.”
Some of Earnhardt’s biggest deals were joint partnerships with the drivers whom he slammed fenders with on track in feuds that built his sway.
While Jeff Gordon’s rise threatened his victory totals, Earnhardt viewed the emergence of a young championship foil as a vehicle for building interest in NASCAR, and they entered business and real estate ventures together (including as shareholders in Action Performance, a major diecast retailer that also bought Sports Image from Earnhardt for $30 million).
“He would know who was selling (how much) every weekend,” Gordon said of Earnhardt during a December 2018 appearance on The Dale Jr. Download. “Where his sales are, where the other drivers are, he knew it all. I think my stuff started getting up there. I’m sure there was a little rivalry and competition, but he embraced it and said, ‘Man, I think we got something here we can grow.’ ”
Dale Jarrett owned three businesses with Earnhardt and said Cup drivers appreciated being able to draft off the enormously popular “Intimidator” persona into their own profitable windfalls.
“He didn’t have to do that, he could have made his own money,” said Jarrett, the NASCAR on NBC analyst and 1999 Cup Series champion. “And even though it was about making money for all of us, it also was about bringing a service and opportunity to the fans. I think we all appreciated that and what helped drive the sport.”
Hawk said Earnhardt’s drive at the office started early after 5:30 a.m. rounds of his shop and the livestock on his farm.
“When he came to the office, he wanted to know how much money we made last week and what did we plan on doing this week,” said Hawk, who started as general manager and rose to president of DEI during his 1993-2000 tenure. “The minute the helmet was hung up and Monday morning came, it was, ‘How many dollars of souvenirs did we sell? What was our gross profit, revenues and expenses? What did we net?’ And he started doing that with endorsements, sponsorships and spokesmanships. For an eighth-grade education, he was very sharp. You didn’t have to tell him twice, and one thing he understood was money.”
Through interviews with those in his business orbit during the 1990s zenith, NBC Sports explored Earnhardt’s meticulously constructed Q score clout in this chapter of a weeklong series recalling the legacy of Earnhardt 20 years after his death:
Don Hawk, former DEI president: The relationships start to build bridges. Coca-Cola was huge. It took a long time to get that done. Earnhardt had a different deal than just being part of the Coca-Cola Racing Family. He had the true endorsement. That started to kick the door down. We did Remington Rifles, and it wasn’t just Dale got guns, he got money to endorse it. The Nabisco deal, Dale spoke at their annual convention to their employees and leaders, and they paid a regular speaking fee like someone in the Washington Speakers Bureau, and they paid him over six digits to come just to speak.
We went to the QVC (home shopping network) with one goal in mind -- and Michael Jordan and (agent) David Falk couldn’t have been better sports about it. But in one hour, we broke Michael Jordan’s record for selling products on QVC. We sold $768,000 worth of product in one hour on QVC. And it was diecasts, it was clocks, watches, pennants, T-shirts, hats. You name it, we sold it. A year later, Dale was at Michael’s restaurant, and he and Dale met, and Michael was joking about going back on QVC to blow up Earnhardt’s number. And Dale said, “Why don’t we both go on together and both kill it?” We never got to that point, but it was pretty neat.
Jeff Burton: There were a lot of people who sold a lot of merchandise with Dale Earnhardt’s name on it. And they would tell you how great they were, and I’d be like, “No, you sell my shit, that means you’re good. I could sell his stuff.” Anytime one of them would say to me, “I did this for Dale!” I’d say “OK, you’re not my guy.” Because anyone can do it for him. He was just the guy.
Hell, I had a Dale Earnhardt T-shirt. I was racing at Orange County Speedway on a Saturday night, and we were going on a four-day vacation, and I went out to one of the souvenir trailers and bought a Dale Earnhardt T-shirt, so I’d have one to wear on vacation.
Dale Jarrett: He showed us all there was a whole other business out there besides driving a race car. When he and Benny Ertel and his whole group of people started in on understanding this whole other side of T-shirts and hats and other opportunities as diecast cars came along, it became another business. And Earnhardt showed us all the way, and he also led sales every year in that respect. Business opportunities came along for all of us because everybody couldn’t be associated with Dale Earnhardt.
But he also included a number of us in his business ventures because he was a smart businessman who understood that getting people like Terry Labonte and Rusty Wallace and myself and Bobby Labonte was a part of it. People that were doing well in the sport at that particular time, and Gordon was a part of it, he knew we could be competitors on the track and every weekend we could try to beat other on the track, but as a group, we were much stronger in providing fans with what they wanted in souvenirs. He helped make a lot of us a lot of money.
We are @IMS - we’re working on a deal, yes @JeffGordonWeb #TerryLabonte and Dale Earnhardt working together - Teresa reviewing my deal points. At least everyone is smiling - more to come on this one. Good catch #DonGrassman— Donald Hawk (@HawkSMI) January 26, 2021
Rusty Wallace on The Dale Jr. Download in March 2019: When they started the merchandise business, he got me involved in that and made some good money. He was a good guy when it comes to that. We spent a lot of time off the track. … One time at North Wilkesboro, Mr. France Jr. got a hold of us, and we were talking about T-shirts and on and on about merchandising. We were having a good time back then with all these different paint schemes. It was exciting.
So we get in the race, I come off Turn 2, he bangs me in the back end. I got hot and come off Turn 2, and I slammed the brakes. He hit me so hard, it tore off his grille and front end. I finished second, and Old Man France comes down and says “What in the hell are you doing out there, man?” Just selling T-shirts, boss. I really respected (Earnhardt). He taught me a lot. He made me want to be like him. At times, he made me want to dress like him.
Kyle Petty: When it came to hats, T-shirts, trinkets and swag, (Earnhardt) had a team of people and established a group that maximized the potential of the time. Would that work today? Maybe not. Would it have worked 10 years before (then)? Probably not. But if it hadn’t been Dale Earnhardt, it might have been Rusty Wallace. Whoever was in that position then could have taken advantage of that situation. Earnhardt took advantage of the situation that was presented to him. You can say -- and rightfully so -- that during that period of time he was a leader in what was going on from diecast cars to T-shirts to everything, and his team and his group did the best job of anybody in this sport. But I just think that was just the right timing. I think Jeff Gordon could have done the same thing or Dale Jr could have done the same thing if he was there at that time.
Hawk: Teresa was heavily involved. They played off each other, but they didn’t always agree. Teresa was tough. For a long time, people thought, ‘Man, Hawk, you’re brutal.’ Some of it was doing what I was asked to do, but I was just a loud voice in the room. Anybody in the boardroom knew Teresa was as tough, and I don’t mean that derogatory. Teresa was sharp because she knew they could have a big business. She wanted to make sure she saw every deal and every decision. There was a couple of deals that we lost because we were too onerous. We were too tough. We wanted a big number and wanted our cake and eat it, too. That’s part of how it went.
Bill France Jr. and Dale were extremely tight, and Bill would call sometimes and go, “You guys are running fast, pal. Don’t forget, every single guy that races against you, needs to be taken care of,” so we formed a company owned by Teresa and I called Optima Consulting LLC. And we helped other race car drivers and teams with deals because Bill France told me “If you take all the money, none will be left for the guys racing against him, and your champ will be a chump.”
You have to give credit to Hank Jones and Joe Tillman at Sports Image for getting this idea to put souvenirs out there in the trailer and sell them. And to Ken Barbee, who recently died. He had RJR’s license and eventually got Jeff Gordon. The dangerous part of this sport was when Earnhardt and Gordon started marketing together. It was phenomenal. We owned companies and real estate together. He was Pepsi, we were Coke. He was the champ, we were the challenger. He was The Kid.
Jeff Gordon on The Dale Jr. Download: Our relationship started growing. One of the first times we interacted, your dad asked about signing autographs at Greenville Pickens (Speedway). Big crowd. And so I went. Crazy lines of people. I went there just blown away, and they were all there for (Earnhardt). But I had a pretty good following at that time, too. He was there for hours upon hours signing autographs. There was some money involved. It was a business deal and a good one. We talked after that and the souvenirs started to build up.
Hawk: Chase Racewear was the apparel company formed on a napkin in Ken Barbee’s condominium, No. 407, at Charlotte Motor Speedway. As Ken and I talked, Joe Mattes (now the vice president of licensing and marketing for Dale Earnhardt Jr.) was writing on a napkin the deal points that I took to Dale and other drivers. We offered the rights to the company if they’d allow us to have Jeff Gordon and Dale Earnhardt and a couple of other drivers to own a small piece of it. We gave shares to Earnhardt and Gordon. Rusty Wallace, Terry Labonte, Bobby Labonte and John Force, because we wanted the NHRA involved. I remember walking around and handing those guys checks that were in the hundreds of thousands after the first quarter.
Gordon: Fred Wagenhals was coming along with Action Performance and said we need to get more drivers. He talked to me, and it was one of the best business decisions I ever made. They did a great job with the diecasts and made a bunch of us a lot of money. I was very appreciative, and it worked out good for (Earnhardt), too. After that I didn’t mind going to talk to Dale about contracts. He was the first one that came to me. Things were different back then. We’d get on his plane and go to places to sign autographs and do sponsor deals. You start talking on these planes. (Earnhardt) told me right away you need to get all the rights to your likeness. If you can get your licensing deal, too, you need to get that. A lot of things he was doing, he talked me into doing it.
I just wanted to win and perform on track, but Dale would do things -- we’d be on Lap 10 of the Daytona 500 and he’d take us three wide. I’d be going, “What the hell?” But he had this ability to know he’s got all these fans up there that are going to love this. They’ll eat this up -- and they did! He had this ability to read what the fans were asking for.”
Hawk: Dale wanted to not be in debt, so he’d ask, “How much money do we need to pay every vendor every month on time? Then find me that many sponsors or endorsements and we’ll do that many appearances.” One year, we did 342 personal appearances or souvenir gigs with fans because that was when we were starting the building of DEI (the main building), and he wanted a boatload of cash to start. We were on the road somewhere that whole year.
Dale said, “I want a Learjet, but the only way I’m going to buy it is you tell me you paid for it (in full). Find the money to pay for it, and when you do, I’m going to tell you I want that jet. He and Teresa went to the Bahamas. I negotiated with the Learjet president, and I said to Dale we can buy that airplane. He said pass me all the info on it. He had to go to a phone booth on the island in the Bahamas because the yacht phone wouldn’t work. He calls in a phone booth and says, ‘Are you sure that we’re not taking any money out of the bank account?’ I said we’ll take money out of the bank account that we’ve accrued doing this deal, this deal and this deal. So I sent the paperwork to Lear, they sent me a bill of sale. I faxed it to the yacht, and we bought it while he was in the Bahamas with Teresa.
He said, “If the jet costs one dollar more than $3 million, I don’t want it.” I had the buyer’s order written up for $2,999,999 just because I love to win and wanted Earnhardt to know I came in under the number. He gave me a goal, and I had to beat it. I joked with the guy and said I’ll send you the buck.