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Is Reebok’s UFC deal a public relations nightmare that could scare away future sponsors?

By Zach Arnold | May 14, 2015

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It started years ago with UFC slapping a “sponsorship tax” on companies who wanted to sponsor individual fighters. The idea was that UFC had a right to get paid for creating the stage for advertisers to market their products to the masses. The idea was also couched in terms of protecting fighters by weeding out deadbeat companies.

Then it morphed into rumors a couple of years ago of UFC creating fighter uniforms in order to control sponsorships.

It’s now morphed into UFC inking a corporate deal with Reebok. It was supposed to revolutionize fighter sponsorships and make UFC a ton of coin. Instead, the UFC/Reebok partnership merely became a pretext for all of the major economic problems between management, fighters, and managers to rise to the surface for all the public to see.

In short, the Reebok sponsorship is being treated as rotten in the court of public opinion by everyone except UFC. The fruit from a poisonous tree.

We had the anti-trust lawsuit filed in San Jose against UFC. Fighters uncharacteristically spoke out in protest of the new proposed pay scale by UFC in regards to how much Reebok money they would get. The protests escalated thanks in part to fighters no longer being able to cut their own nickel-and-dime sponsorship deals. The protests claimed that their nickel-and-dime deals have been reduced to penny-ante Reebok payoffs.

MMA managers are now screaming from the mountain tops about some sort of symbolic meeting of the minds to figure out what to do now that the UFC/Reebok deal has cut their cash. And for managers like Monte Cox who actually understand the MMA industry and do a professional job, their only option is to deepen their business relationship with Bellator. Viacom is laughing right now.

Fighters are now claiming on Twitter that UFC is only allegedly starting to make phone calls to determine how much fighters are going to lose in cash thanks to the newly instituted Reebok sponsorship deal. Restraint of trade?

In a great MMA Fighting article by Marc Raimondi, this passage raised a lot of eye brows:

Not every manager is against the Reebok pay structure. John Fosco of VFD Marketing, who reps the likes of Travis Browne and Clay Guida, is firmly behind the UFC. He doesn’t believe fighters should have ever had the ability to get their own in-cage sponsors, since the fights take place on UFC television and pay-per-view. He calls the UFC allowing it for so long “a gift.”

Whatever happens in regards to a fix or a remedy between fighters & UFC on the Reebok sponsorship, one thing is very clear: the damage has been done to UFC’s corporate image. This is an organization that, as Jordan Breen of Sherdog rightfully points out, has never been able to fully control a media narrative. Strong-arming media writers is one thing but controlling an actual narrative is another. Part of this is due to the fact that UFC’s audience is largely made up to 18-to-34 year olds who are active on social media and will not hold back their opinions. They’re impatient, cynical, and aggressive.

If you’re a major advertiser who is interested in reaching out to UFC’s key demographic, the public relations carnage Reebok has had to endure will make you take a step back before considering investing money in the MMA sphere. It’s enough to plant seeds of doubt. Reebok has been getting trashed despite the fact that they have no control over dividing payouts to various fighters. Reebok thought they were getting a very affordable deal with a lot of upside. They’re getting hammered before the deal has even been implemented.

This house of cards is all of UFC’s making. If you’re a prospective sponsor, why in the world would you want to put your proverbial hand in the blender and be at the mercy of angry fighters, managers, and fans? The UFC’s struggles in protecting Reebok’s image since the sponsorship deal details were announced must be very concerning for the parties involved.

When you live by the sword, you die by the sword. UFC will continue to remain profitable while remaining a sports property on the outside-looking-in as far as gaining mainstream marketing appeal. At some point, current ownership will cash out when the headaches become too great. It is my opinion that this will happen sooner rather than later.

Topics: MMA, Media, UFC, Zach Arnold | 9 Comments » | Permalink | Trackback |

9 Responses to “Is Reebok’s UFC deal a public relations nightmare that could scare away future sponsors?”

  1. 45 Huddle says:

    Most individual sports allow the athletes to wear their own sponsors. This isn’t a team sport. The UFC is in the wrong.

    I would have no problem with them limiting each athlete to 1 or 2 sponsors and regulating how they look. MMA can look trashy sometimes with too many sponsors. But the fighters should be able to make money on the side like before.

    This is horrible PR for Reebok. Not sure which executive signed off on this one.

  2. 45 Huddle says:

    NSAC dropping the hammer on offenders in the future.

    I love it…. As long as they are using the proper testing to put these punishments in place.

  3. Mark says:

    It’s not good, but I don’t know if I buy that it’s going to send a wave of fighters into Bellator instead of signing with/staying with UFC. Maybe the new guys might say “I’ll get this sponsorship money now in Bellator, but then I’ll sign with UFC when I have name value.” So at the end of the day, that’s still leaving Bellator as nothing but a feeder league. And all it really hurts is TUF, since those are the kind of fighters who’d be thinking about the nickels and dimes of sponsors.

    But at the end of the day, UFC is still UFC. I don’t care how big you are in Bellator, you’re going to eventually take the gamble that you’ll make it in the premiere MMA company and become a millionaire PPV headliner.

    UFC is like a major label in music industry (at least in the pre-piracy days): Yes, they will screw you on money. Yes, you probably should play it safe and stick with a non-major label where you won’t be famous but you will be paid better. But if you want to be a superstar, they’re the only place you can go to do it. Bellator is great, but their biggest star is still less famous than a 4th tier UFC star. Guys want to headline a PPV or a FOX show, they want a Wheaties box, they want magazine covers, they want to be on talk shows. Bellator has only been able to get Rampage on Craig Ferguson years ago and Ortiz on Larry King’s internet show. They don’t make stars, unfortunately.


    So it looks like reeboks $70,000,000 over 6 years should average $1,000,000 per month or $250,000 per show with 24 fighters per show $10,000 each.

    looking at junes 4 shows…
    ufc 188 24 fighters total reebok payout $145,000

    UFC Fight Night – Boetsch vs. Henderson 24 fighters total reebok payout $110,000

    UFC Fight Night Jedrzejczyk vs. Penne 24 fighters total reebok payout $142,500

    UFC – The Ultimate Fighter: Brazil 4 Finale
    the card isn’t complete but reebok pay should be very low considering tuf feature new fighters.

    Its pretty clear that when tuf brazil is added $102,500, there is a missing half million dollars for june.

    its also clear that the majority of fighters will make $2,500 for the month of june.
    With steroid cheats like marquart and Siver making $15,000 or better.

    I think ufc would really struggle to stack a card with enough champions and seniority to generate much more than $250,000 in reebok sponsor $. Considering the rest of the year looks grim without most of their biggest stars.

    I think that ufc is skimming about 1/2 of the deal and will continue to do so for as long as they can get away with it. I don’t buy the argument that the sponsorship money will increase per fighter over the years as they accrue more fights, since many fighters will be dropped after just a few fights.

    Even if the $1,000,000 were distributed evenly at $10,000 per fighter it seems clear that most would make more with individual sponsors alone.

    Considering the disgusting the over the top “show of support” Dana gives fighters like Shaub who will be making 10 times less. It seems clear that the ufc DOESN’T have the fighters best interests at heart in this deal, otherwise there would be an honest attempt to compare which is better for the fighter.

    And thats not even mentioning the fact that reebok will have free usage of fighter likenesses to sell reeboks products.

    one and five $2,500
    Six to 10 $5,000
    11 to 15 $10,000
    16 to 20 $15,000
    21+ $20,000.
    Champions make $40,000 and title challengers $30,000.

  5. SonnensRoidedNut says:

    It’s not hard to figure out the Reebok deal. Take UFC 187 that is coming up. The total UFC/Reebok Sponsorship payout is $142,500 for the 12 fights. Diaz’sBowl right above me, he just did UFC 188. That came out to $145,000.

    So with 13 PPV #number cards this year, take 13 x $150,000 (error on the high side), and that comes out to $1.95 million.

    The UFC is also doing another 30 smaller events. FightNights, Fox events and such. Let’s say that average is around $120,000 per event. 30 x 120,000 = $3.6 million.

    Add them up. You get an estimated/ballparked payout for the 43 events for 2015, coming in at or around $5.6 million. The Reebok deal is for $70 million over 7 years. An average of $10 million per year.

    The UFC brings in $10 million from them. They pay taxes on that. Assume a corporate rate (or whatever LLC rate they are paying on their Schedule E) of around 15%. That leaves around $8.5 million. They pay $5.6.

    I’m looking at $2.6 million still on the table. Does the UFC really need a 35% cut of the deal (which is even after taxes). That seems high. That seems a bit excessive. I feel like the UFC could bump that payout up another 20%, and still pocket almost $2 million a year from Reebok.

    Would a 20% bump could be meaningful? Payouts would look like this…

    01-5 fights is $2,500 > $3,000
    06-10 fights is $5,000 > $6,000
    11 to 15 fights is $10,000 > $12,000
    16 to 20 fights is $15,000 > $18,000
    21 fights or more is $20,000 > $24,000

    …Looking at this, thinking on it…. would even adding the 20% bump make fighters happy? No. how about 30% increase, which almost maxes out the Reebok deal? Nope. Fighters won’t be happy with what they are getting. A ten fight fighter, would go from $5,000 to $6,500. He’ll still be mad. That won’t work either.

    So pretty much, there’s nothing the UFC can do here to make people happy. $70 million over seven years, isn’t enough money to spread around to everyone. They negotiated a deal with Reebok, that should have NEVER been made, promising them exclusive rights like that. Knowing full well $10 mil a year wasn’t enough. They should have got Reebok to sign off on partial sponsorship space on the shortS, taken maybe $35 million over 7 years…and allow fighters to do the rest of the space on the pants. 50/50. Win/win.

    Seems simple. I did this in five minutes on here. Why can’t the UFC figure this out?

  6. SonnensRoidedNut says:

    To put into perspective how ridiculous the above is:

    Under Armor offered Keven Durant $285 million over ten years. Yes, that is correct. UA offered Durant an average of $28.5 million a year. Just ONE freaking person to wear their clothes. The UFC is getting $10 million a year, for ALL 500+ athletes to wear Reebok’s brand.

    Yeah, the NBA is a lot bigger than the UFC, but the disparity up there seems just ridiculous. UA can dump that much money on one person, and Reebok gets like 500 athlete’s right for an entire year, for 65% less money? Seems like Reebok got a steal there, especially so, consider there are 43 UFC events each year, and Durant only plays in 82 games, to which probably half aren’t even on TV/cable.


    The entire deal was to make UFC and Reebok money OFF the fighters without consulting the fighters.
    Its basically a corporate tax on the fighters, not a corporate hand out as they would have people believe.

    Giving reebok authority to produce mma related apparel is not “taking mma to the next level”, as dana would lie.

    Remember when the fighters uniform idea was leaked? UFC and Dana said its not going to happen they were just doing some goofing around, you know just drawing some pichers just to see how they would look. At that time I think aprox .001% of fighters were excited to be wearing a Mc D’s type uniform.

    The ufc mentioned nothing about this deal in order to keep their money grab plot on the right track.

    So they make the deal without any fighter input, just the corporate heads.

    Its a bad deal for all the fighters except about 1%. Literally only a handful of fighters have an exclusive deal promoting them, as ufc fighters or champions…

    Really the best thing for the other 99% of fighters to do right now is to OCCUPY THE UFC have a lawyer draw up their demands and just refuse to do anything until the ufc restructures the deal to the FIGHTERS and FANS liking.

    Were current UFC fighters to walk off, where would the ufc get a few hundred fighters to fill 50 shows per year?


    With the class action lawsuits by ex ufc fighters, its abundantly obvious to everyone that current employed fighters need to stand up and fight, or they will be filling class action suits later when they are unemployed…

    So, fighters…do something other than bend over for a change. GET ORGANIZIZED!
    Within a few months you can all find new jobs(who’s going to turn down a UFC fighter for a job!) doing whatever taxi driver, construction security guard, so when you walk off you will have a steady income.

  8. SonnensRoidedNut says:


    Keep in mind, you can’t draw blood from a stone. Even if the UFC leadership had went to the fighters before the deal…. what good would have that done? The deal is $70 million over 7 years. $10 million a year. That’s just not enough money to distribute per event, per fighter, to make up the shortfall in private 3rd party sponsorships.

    As i mapped out above, even if the UFC paid out 100% of the Reebok proceeds under this current plan, there’s just not enough money there.

    The only solution here for the UFC is this. Go back to Reebok. Tell them the exclusivity portion of their deal can’t work. Convince Reebok to be ok with say 1/2 of the shorts. And then let the fighters use their sponsors on that half. Whether it be front or back, or side vs side…work something out.

    I can’t imagine the UFC would do that the above.

    • DIAZ'S PACKED BOWL says:

      “The only solution here for the UFC is this. Go back to Reebok. Tell them the exclusivity portion of their deal can’t work. Convince Reebok to be ok with say 1/2 of the shorts. And then let the fighters use their sponsors on that half.”

      I agree. That’s pretty straightforward…

      Obviously you want a big name sponser like nike or reebok, but not at the expense of the fighters.
      What you suggest im sure the ufc doesn’t really care about since they’re obviously VERY happy with their cut. So the fighters again should occupy ufc and demand that 1/2 of their shorts be allocated to their own sponsers, and be able to bring in those nifty sponser banners. Because after all, most of those sponsors don’t sell shoes and clothing.


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