By Zach Arnold | February 21, 2014
— MMA Supremacy (@MMASupremacy) February 21, 2014
This has been an ugly month, PR-wise, for the UFC (sans the trumped up Sig Rogich special in Washington DC).
The good news? The company drew a strong rating for the Lyoto Machida/Gegard Mousasi fight. It took a lead-in from NASCAR for momentum, but it worked. And we’ll probably see such a pairing for future FS1 events.
As for the rest of the news & rumors? As one poster wrote on The Underground Forum, the UFC is acting like they want to be the McDonalds of MMA with all the franchising options available to play with. The punchline is that running so many cards means fights with competitors who might be more fit for a McDojo than, say, American Kickboxing Academy.
There has been a big uproar online about the possibility of UFC signing a lucrative deal with a company like Under Armour to create standardized uniforms. The idea would involve the UFC getting a big sponsor or sponsors to pay for advertising on the uniforms. Would the fighters get 50% of the advertising profits from Zuffa? Sure, if pigs could fly.
And, of course, if you’ve been paying attention to the 2014 Sochi Olympics, Under Armour has been Under Fire with American speed-skaters.
What makes the sponsorship deal so interesting is that the UFC is no longer hiding their true emotions on it. It’s not their problem, says Dana White. But, of course, it apparently is their problem when they charge a nice chunk of change in the form of a “sponsorship tax” and thus there have been several companies who have found themselves in an on-again/off-again business relationship with UFC. Volatile.
The big question I have in the long-run for UFC and sponsorship cash is whether or not it’s actually worth investing your corporate dollars to advertise with the UFC. Tell me one company that has advertised with the UFC and has seen explosive growth because of it. That vaunted 18-to-34 year old demographic is supposed to be great at brand-building, right? The one company you could try and stretch to make an argument for in terms of being an advertising success is Dynamic Fastener. It turns out that they can afford to advertise with blocks of fighters because they aren’t subjected to Zuffa’s sponsorship tax or else they wouldn’t be able to afford to advertise in the first place.
What else can you classify as a major marketing/advertising success for the UFC? Xyience? We all know the back-story on that garbage.
So, you have the idea of UFC considering athlete uniforms. Then there’s all the regionalization going on with non-stop cards that get lost in the shuffle. Makes it easy to skip shows and really hard for the hardcore fans to watch all the events. The more shows there are and the more value is placed on the UFC brand rather than the fighters, the less leverage there is for top stars. And UFC further increases their leverage using non-American stars in locations where they aren’t going to put up a legal challenge if they feel they are getting screwed. Some Brazilian fighter is going to sue the UFC in a Nevada state court in Las Vegas? The counter-argument from UFC is that they don’t sue fighters like Bellator and that UFC contracts look great in comparison to Bellator’s alleged deals with options or supposed requirements of selling tickets in order to get paid.
It’s interesting to see how many defenders of the UFC have jumped aboard the “UFC is not a monopoly!” bandwagon this week after Bellator made an offer to Gilbert Melendez. See, big bad Viacom really is heavy competition for UFC despite budgeting $50,000-60,000 per TV show. Which is why Lorenzo Feritta’s political fixer & Nevada power broker, Sig Rogich, has an unofficial UFC bastard child group in World Series of Fighting that has signed fighters that may have otherwise signed with Bellator. Funny how that works.
The big fly in the ointment for the UFC with their current strategy is that they still heavily rely on PPV cash and PPV requires stars. Building stars over building the brand. Dana White spent last week pushing the narrative that Ronda Rousey is the biggest star ever in the UFC. Sorry Chuck & Tito. But Dana’s in a win-win situation by pushing that narrative. If UFC 170 draws great on Saturday night for PPV buy rates, then he can continue to push the narrative. If the buy rate tanks, he has gained a new talking point for leverage in not having to pay Ronda as much money for the next contract. NFL boss Roger Goodell likes to talk about protecting “The Shield” and apparently the UFC feels the same way about pushing their brand first over any other principle in a business like combat sports that, outside of pro-wrestling promotions, has always been about marketing individuals.