To say that tomorrow’s UFC 168 is an important event for Zuffa this year would be quite the understatement. In fact, the focus placed on UFC 168 has been so strong that some have argued that it has actually undermined the UFC events in between, which caused them to under perform. We will take a look at some of the numbers and the promotion being put together the week leading up to the event.
The UFC announced on July 13th, 2013 that the highly anticipated rematch between new Middleweight champion Chris Weidman and MMA legend Anderson Silva would take place on UFC 168, making Rousey vs Tate 2 and incredibly strong co-main event for the casual fans and mainstream. Since that announcement was made, about 5 months before the event was to take place, the UFC made it no secret it would be heavily promoting the event, which include an entire season of TUF dedicated to pitting both coaches on the PPV along with countless of media appearances and press conferences. To summarize, the UFC has been promoting UFC 168 for five months straight hoping to cash in big at the end of the year.
In that span, the UFC has hosted four PPV events, from UFC 164 to UFC 167, and all have arguably underperformed. Pettis vs Henderson, the highly anticipated rematch from WEC, which produced the Showtime Kick, drew less than 300,000 buys. Jon Jones was the first noticeable casualty, drawing his lowest PPV buy rate since becoming champ. Velasquez/JDS III drew 330,000 viewers while Velasquez/JDS II drew 590,000 the previous year. GSP’s 630,000 PPV buys are the lowest since UFC 87 in 2008 against Jon Fitch z9 not to mention that it was the UFC’s anniversary event). All events underperformed, but will the gamble to place most of the attention on UFC 168 for almost half a year pay off? They are certainly betting on it.
|
UFC 168 |
???? |
Weidman-Silva II |
|
UFC167 |
630,000 |
GSP-Hendricks |
|
UFC 166 |
330,000 |
Velasquez-JDS III |
|
UFC 165 |
325,000 |
Jones-Gus |
|
UFC 164 |
270,000 |
Henderson-Pettis |
The UFC has gone all in the week heading into UFC 168 with countless ad spots on FOX Sport properties and key big FOX spots during NFL programming. The UFC even scored an appearance in Good Morning America this morning. To put it bluntly, a lot of money was spent on promoting UFC 168 and considering that UFC predicted the event would be as big as UFC 100 (1.6M buys), they really had no choice. Then again, the UFC also bumped up the PPV price by $5 just for this event, hoping to reach UFC 100 levels of revenue even they most likely won’t be able to match the buyrate. This week, Dana White estimated the gate for UFC 168 to be around $6.3M already, which would place it among the top gates in the company’s history. It also appears that ESPN is all in for this event, which has historically meant good things for the UFC.
Now, is the event a shoe in to become a huge PPV success? Well, not necessarily. End of the year between Christmas and New Years has always been a tough sell due to the festivities, new toys, NBA, and CFB Bowl games. UFC 141 hosted a huge main event between Brock Lesnar and Alistair Overeem, two of the biggest and physically gifted athletes in MMA. Lesnar had been a shoe in for 1M PPV buys for years with the UFC, and adding an opponent like Overeem seemed like a PPV buyrate slam-dunk. Only, it didn’t turn out that way. The event ended up doing around 535,000 buys, which is nearly half what most expected, though there were a few key differences between that event and UFC 168. One major factor was holding UFC 141 on December 31st (Friday night) where UFC 168 is being held on the more traditional Saturday night time slot. Lesnar had also lost his belt for that bout for his bout against Overeem after being dominated by Cain Velasquez along with many health concerns. However you slice it, UFC 168 will be a hugely successful event, though the question of whether it can crack the 1M PPV buyrate which Lesnar and only a couple of other main events have been able to accomplish in the past 5 years is still up in the air.
Lets take a look at some of the promotion:
The MGM Grand in Las Vegas has been completely taken over ahead of Saturday’s UFC 168. #DanaCenter pic.twitter.com/ZvcL753fKW
— SportsCenter (@SportsCenter) December 27, 2013
#UFC168 weighins almost here! pic.twitter.com/ZjSzL4UBgn
— MMAWeekly.com (@MMAWeeklycom) December 27, 2013
#UFC going all out promoting this one. pic.twitter.com/hxWaa1wrGz
— MMAWeekly.com (@MMAWeeklycom) December 27, 2013
See what we mean? #UFC going all out … Or is this all in?!!! #UFC168 pic.twitter.com/5aO7A3Fkwc
— MMAWeekly.com (@MMAWeeklycom) December 27, 2013
New Post – Dana White to take over SportsCenter’s Twitter and Instagram on Saturday http://t.co/VvjgZNgJ5g
— Awful Announcing (@awfulannouncing) December 27, 2013
How much buzz does #UFC168 have? @GMA confirmed for interview with @RondaRousey tomorrow. Set to air on Saturday morning. Cc: @RyanGrabUFC
— Dave Sholler (@Sholler_UFC) December 27, 2013
I don’t know about y’all but I am HYPED for this #UFC168 tomorrow night! Gonna be a great one! @danawhite puts on one hell of an event.
— Justin Timberlake (@jtimberlake) December 28, 2013
Yawn
I’m fascinated to see if the hype works and to see how the PPV #s compare to past big events. UFC has done everything they know how to do to hype this. Conventional wisdom is that interest in UFC is significantly down in the last few years, so it’ll be interesting to see what kind of # they can pull despite the decline in interest.
Desperate times lol….UFC is heavy marketing dependent….up to how long can Dana white micro manage the marketing side of the UFC?
I don’t make a lot of predictions, but I think Anderson’s reign is over and so is the UFC with PPV buys. Might do 500K.
Heavy marketing means heavy spending, throwing money at a problem usually doesn’t solve it. The weekend before New Years can be very unpredictable, anyone successful in the entertainment business knows this. Putting all your eggs in one basket to make up for earlier failures can be disastrous. They need a very strong showing to end the year no doubt, will the casual TUF fans decide to tune in? Silva on his own? that’s the question too. Rumor is they are trying to bring Lesner back lol. Another stupid idea, they had their window with this guy. UFC needs to take a step back and build slowly and naturally on what they have. Everyone with a brain knows a business on financial steroids deflates.
The bubble is set to pop… it will be ugly like Brainsmasher’s face
I have been in the fight promotions business for nearly 30 years, and 500,000 PPV buys on any show is HUGE and extremely hard to achieve for any fight show! We shouldn’t question the PPV numbers from 164 at 270,000 or 165 at 325,000 or 166 at 330,000 or 167 at 630,000, as any major promoter either boxing or MMA might give up their first born to get any of those numbers.
Lesnar
Lesnar coming back? Gsp’s retirement caused them to press the panic button if it’s true that they be bringing back lesnar lol…..band aid approach…..
You are partly correct Roy, sure those numbers could be considered good, it all depends on what money was put out. Overhead is everything! A show that has a 350 k buy might seem good but if your break even number is 500 k you might be looking like a fool.
Yo tops, when do you think the UFC will dissolve?
Who cares how much the buyrates where?
When you have overhead like the UFC does and marketing costs they incur compared to other business models it’s ridiculous to assume a certain number is good enough for them to be in the black
@Sampson Simpson What crazy “overhead” and “marketing” expenses are you talking about? Why are they in such a uniquely bad position, versus say a boxing event like Bradley-Marquez, which was considered a success with 350k WITH a MUCH bigger payroll?
Marketing for one. Boxing promoters spend nothing compared to Zuffa.
Staff overhead. Boxing promoters have skeleton staffs compared to Zuffa
Real simple
Sampson – I’m not sure that’s true. The primary overhead would be labor costs, and boxing has a much higher one than Zuffa. Also, doesn’t Zuffa have way more lines of business and revenue streams than boxing?
Tops – I don’t think they bring back Brock, but why wouldn’t they? If he draws well, and wants to fight, where’s the issue? They aren’t talking about title shots immediately, it’s just to get him back to the Octagon – and I have no problem with him fighting.
500k seems like a low guess. I think closer to 1MM than 500k.
Damn Sampson taking it personal Lol
DW has no more stars, those are some awful buy rates for fighters who are considered superstars.
DW must be crying in his Ferrari.
What about the $800 million loan that Zuffa needs to repay next year?
I know all about the loan, but I would love, love to see you back up your staff/marketing/overhead assertions with some actual sources/links.
You know about the loan? Then you must know about debt… then you must know about interest rated… then you must know about repayment obligations… then you must know Zuffa’s administrative staff costs… then youmust know about costs incurred vs boxing promoters who pass along those costs to the network.
But you know nothing
Wow, what an absolute joke. First of all, “Then you must know about debt… then you must know about interest rated… then you must know about repayment obligations” is entirely redundant. You’re trying to sound smart by using a lot of words but saying nothing, kiiinda like Democrat “economists” always do. Second, regarding the part about passing costs along to the networks, Zuffa gets around 100M a year from Fox in their deal. I’m pretty sure that MORE than covers any “costs incurred.”
But you know nothing.
Sampson is definitely right about boxing running cheap, affordable operations.
Most boxing promoters, from the small ones, to the significant regional ones, to the national ones, to the international ones, operate out of a PO BOX, a registered agent, or a boxing gym. These are very low-cost operations or if they run out of a boxing gym (ex: Dave Tiberi ~ mid-Atlantic) even profitable headquarters.
Go visit Don King’s “office” in Deerfield Beach FL. It is nothing but an address in a small little, cheap, business park. You think when Don King wants a fighter he flys them down to the magnificent Broward County and drives them around like Dana White in exotic sports cars? Um no….
Boxing promoters usually deal with you in the gym you fight out of, their own gym, or simply over the phone/mail/email. In the boxing world you will already have links to a promoter when you start or promoters will find you. That is true even if you never have a chance at big fights.
Boxing promoters are usually 1 or 2 guys, a lawyer, an LLC, and an address. Even the big promoters like Don King or the now dead Butch Lewis are never going to be found on massive 24 acres headquarters like the UFC.
She knows nothing… and her panties are definitely bunched and brown
Thanks Random Dude, so the question naturally becomes… if the boxing model is such the superior one, why doesn’t Zuffa and everyone else copy it? If, as you say, all of boxing does it, I can’t imagine it being very difficult (aside from the crazy-risky PR move of laying off however many thousand Zuffa employees). Also, so then aside from press conferences, interviews and the occasional fight fixing here and there, what exactly does King and the promoters do??
Fox didn’t hand Zuffa a check for 100 million lmoa, thats the amount of money that was put into the project. Every single expense that goes into the production of every aspect of every show comes out of that sum. What’s left over is called profit, after everyone and everything is paid for. Even the lady that cleans up the popcorn boxes on the floor in an arena is paid out of that money. Its so funny how people read something like that , and it happens all the time, and believe thats what they made. The lists of costs to put on live TV events is enormous!!! Just air fairs , hotel, travel and food for production crew alone is in the millions.
“if the boxing model is such the superior one, why doesn’t Zuffa and everyone else copy it?”
Great, now I have to give a long BS-style post…
The current state of boxing happened by accident in a way. Before Don King entered boxing, boxing operated much like the UFC and MMA does, only more big players all over the place. Unlike other boxing promoters, Don King was truly only interested in business and making money. He didn’t care if you were black, white, Jewish, Muslim, etc. The question is, can money be made? If so, lets do it.
Don King doesn’t care if he likes you or you like him, he wants to make money. He isn’t going to prevent a fight from happening because he doesn’t want a white guy to win the belt like boxing promoters before King did to black fighters. You won’t hear about him not setting up a fight because he doesn’t like another promoter like Dana has done with Fedor and various other fighters. In fact, Don King made the impossible fights happen that other promoters couldn’t because of their greed and inability to work with other people.
To make money in boxing in the post-Don-King era you have to work with other people. Your money-making fighters need fights and need other territories to fight in. Even if you are located in Atlantic City or Las Vegas, you can’t be a complete jackass as a boxing promoter and make money. Trying to be a national and global monopoly like the UFC will leave you broke very quickly in boxing. Wealth has to be shared to make a lot of wealth in boxing, even at the regional level.
The other thing you have to remember is that the Fertittas/Stations Casinos comes from a mob background. The mob was about monopolizing everything and not paying people even if they are important to the operation. All the money gets kicked to the top, no matter how good of a worker you are. What have you done for me lately is always the question and there is no answer that can satisfy it.
The way Las Vegas and Nevada politics works, the Fertittas have never had to get along with anyone to make money or get their way and that idea is foreign to them. Monopolies require a lot of bureaucracy and that costs money, thus the UFC has the big headquarters, bigger staffs, paying people to post on forums and blogs, bigger advertising, etc. because they need all that to maintain absolute national control of MMA. Doing that in boxing would get you nowhere and probably isolated so that you couldn’t make any money. In the MMA world, everybody is eager to be the court jester that they will knock down other promoters if they think Dana will pat them on the head.
We also can’t forget that boxing has had the benefit of regulation by the states and the federal government which has helped a ton. Unregulated markets don’t work to the benefit of the people producing the product.
Basically, the UFC is just another example of psychopathic/sociopathic business men who will let their egos get in the way of making money. Boxing used to be that way although less so due to the fact that there was never one big organization controlling everything. Fake wrestling is certainly that way as well. That is why even though the UFC controls MMA we still haven’t seen 1 single super-fight and probably never will now that everyone is leaving or getting injured. The UFC wants a low cap on pay and doesn’t want anyone bigger than the brand and the sport has suffered because of it.
Random dude just blew my mind
Random dude, very good post. Its very hard to explain certain aspects of the Fighting game and business to 14 year olds who don’t even know who Don King is or what he has done good or bad for boxing. Boxing has a few unfair advantages over MMA. Its been around for 200 years so there has been plenty of trial and error. Not all of anything is good or bad including boxing and UFC/MMA. I call it like I see it, not a hater of anyone or any organization. Bull Shit is Bull shit no matter how you cut it. It will be interesting to see how the UFC survives the next few years. I don’t think top rank or golden boy have the same worries, I wonder why?
Before King got involved, boxers had built in leverage from eqyity of.the sport. Dempsey-Carpentier
First of all Random Dude, I am about 80% sure you are Sampson Simpson. Second, your last answer was self-contradictory and all over the place in so many ways it’s not even funny.
How is the HBO/Goldenboy-Showtime split an example of cooperation? How in any way, shape or form is that for the fighters OR fans???
ANY sources to back up the mob assertions?
Your statements on regulated markets is completely asinine and folly. You obviously have little to none real-world or business experience — by and large, owners and businessmen HATE regulations, as they often require excess time and costs devoted to abiding them. Hence the REQUIRE part. I don’t know if your wires are getting scattered between “sanctioning” and “regulations,” but it makes absolutely no sense.
You did not answer my question at ALL as to why everyone doesn’t do it that way. For the life of me I don’t understand your talk about monopolies being bad for business. Yes, they’re generally bad for the workers and consumers, but the entire reason people STRIVE toward monopoly status is in order to, well, have a monopoly and control the entire market. It’s not worth going into the nitty gritty and nuances of why the following are or are not technically “monopolies” and thus allowed to exist in current form, but it’s seemed to work out pretty damn well for the MLB, NBA, NFL, NHL, WWE. Why wouldn’t it be good for UFC and MMA???
She is paranoid… and she cries
“Its very hard to explain certain aspects of the Fighting game and business to 14 year olds”
Given AK’s response, you are clearly right. I wasted my time writing that post.
I do love his paranoia though, quite funny. He did mention in some other post about liberals or something, so maybe he is a Alex-Jones-tea-party conspiracy dude. Next he will start talking about how my post is somehow related to the Benghazi attack.
I would love, loooove for you to not deflect and actually try to answer my questions (particularly the last one regarding NBA/nfl, etc. And no I’m no Alex jones type. And just FYI, I can tell you have little understanding of politics and life, but he is no tea party type. Jones can prolly be best described as a smarter, less scumbaggy Jesse Ventura, but a pretty dumb, paranoid attention-whore nonetheless.
SHE must be a lady