At a glance
Ruoff Home Mortgage
Business: Independent residential mortgage lender
Leadership: Mark Music, president, CEO and owner since 2007
Headquarters: 1700 Magnavox Way, Suite 220
Locations: 25, including 23 in Indiana
Employees: About 450, including 200 in Fort Wayne
2017 loan volume: $2 billion, projected
Takuma Sato took the checkered flag at Sunday's Indy 500. Then he took a victory lap, the traditional gulp of milk and a $2.5 million payout.
But Sato didn't take all the glory.
Some of that reflected onto Ruoff Home Mortgage, the Fort Wayne-based lender that sponsored Sato's car.
Ruoff's logo was clearly visible during the three-hour race, culminating in Sato's whisker-width win over three-time champion Helio Castroneves by a margin of just two-tenths of a second. The Ruoff name was also clearly visible on Sato's fire suit as he celebrated afterward.
The local company's challenge is how to make the most of its national exposure in the coming weeks and months.
Two local advertising and marketing executives questioned Tuesday whether the sponsorship will give Ruoff adequate return on investment. But Mark Music, Ruoff's president, CEO and owner, doesn't doubt his decision.
“We were hoping he'd be relevant and be on television a few times,” he said of Sato.
The company's actual exposure was beyond Music's wildest dreams.
“It was like a dream. It seriously was,” he said. “It was surreal.”
Music struck the sponsorship deal with Andretti Autosport at the 11th hour. It was after 4 p.m. a week ago today, in fact, that Music received a phone message from the racing team led by Michael Andretti.
In 2016, Music talked to the team about a sponsorship but failed to reach a final deal. The two sides were $50,000 apart, and neither would budge, he said.
Music also thought it would be prudent to wait until the company had tackled some of its planned expansion beyond Indiana's borders. One location has opened in Michigan with more in the works. Ruoff is also opening offices in the Columbus, Ohio, area and expanding its online presence under the Expedite Home Loans brand.
But this time, Andretti Autosport offered a discounted deal that took into account that Ruoff missed out on the exposure generated during qualifying. Music believes the price, which he won't divulge, also took into account his desire to develop a long-term relationship with the racing team.
Music, a long-time racing fan, has devoted more than half of his marketing budget to sports-related marketing for the past several years. He spends more than $2 million annually on sponsorships that have included the Indianapolis Colts; the Indiana Pacers; and Notre Dame, Indiana, Ball State and Butler universities.
Despite the discount, this was the most expensive sports sponsorship deal Music has struck to date.
The rapidly expanding company spends another $1.2 million on other varied marketing and advertising campaigns, he said.
Bob Floyd, president of Floyd & Partners, called sponsoring an Indy car “a very expensive long shot.”
“As an advertising investment, I would term it highly speculative,” he said.
Floyd believes the most reliable outcome is the opportunity to attend the race and get access to behind-the-scenes areas, including sponsor suites. It could be worth the investment for the feelings of excitement and prestige that race weekend offers, he said.
“But does it do much to move the bottom line up? I'd say precious little,” he added. “It's an evanescent high. It will rapidly dissipate.”
Barry LaBov, president and founder of LaBov & Beyond, said sponsors need to be savvy about making the most of their deals. That might include asking a driver to make a local appearance.
“When you're looking at a sponsorship, it needs to have legs,” he said. “It can't have a one-time benefit.”
Music calculates the return on investment differently.
Although Ruoff employs about 450 now, Music expects the number to climb to more than 500 by the end of summer and 1,500 within the next three years as the company “explodes its footprint.”
He projected the $2 billion in 2017 loan volume will increase to $10 billion in the next three or four years.
As the online customer base grows, Music plans to add jobs in Fort Wayne.
That's where getting Ruoff's name out there starts to pay off. Music wants to hire the best, most aggressive sales force. Ramping up the mortgage company's visibility will help make that possible, he said.
“It makes our recruiting much easier,” he added.
The exposure from sponsoring a winning Indy 500 race car also generated excitement among real estate agents and title company staffers, who are in a position to refer borrowers to Ruoff, he said.
“What you can definitely feel,” Music said, “is the momentum that it creates.”