October 4, 2012
Welcome to another edition of the Wrestling Post. This time we take a look at the WWE’s new network show, Slamming TUF ratings on RAW and the King Mo’s debut on TNA.
WWE Main Event rating
The WWE’s newest show on the ION Network, “WWE Main Event,” airing on Wednesdays from 8-9pm earned high ratings in its most important demos during its debut this week. It scored the highest male audience in the last year on the network with the most Men 18-49 (422,000), Men 25-54 (444,000), and Men 2+ (876,000).
Payout Take: The debut had exceptional ratings in part by having two of its top main eventers (CM Punk vs. Sheamus) star in the debut so it is likely that the ratings will decrease considering the fact it cannot have those type of events each year. But, the ratings show growth for the network and another platform for the WWE brand.
WWE shows its smacking down TUF
On this past Monday Night’s RAW, the WWE ran a graphic which showed that Friday Night Smackdown on the SyFy Channel had 3 times as many viewers as TUF on FX. The graphic was shown touting its social media supremacy.
Payout Take: A valid statement that the UFC should take notice. It shows that Friday night is not an excuse for ratings. I find it interesting that each time the WWE takes a shot at the UFC, White does not respond back as he does to media reporters. Perhaps he realizes who he’s dealing with and wants to stay in his own lane.
Lawal upset with Zuffa matching rights
King Mo Lawal made his debut on TNA Impact Thursday. As you recall, Lawal will be doing pro wrestling with TNA and then fight for the Bellator promotion. Lawal signed with Bellator on May 10 will not participate with the organization until 2013.
MMA Junkie reported on Zuffa’s promotional agreement which feasibly could have retained the rights of Lawal after he was released. Ironically, the issue occurred in Bellator as Tyson Nam threatened litigation against Bellator as he was being held out of its tournaments while having opportunities go by the wayside due to the fact that Bellator retained his rights under contract. Dana White has been critical of Bellator for holding fighters like this. However, the UFC/Strikeforce have similar clauses and Lawal and his agent question why it is in the Zuffa contracts. Lawal’s agent had called White to see if the UFC/Strikeforce was still interested in retaining Lawal despite being cut.
Payout Take: Bad feeling between White and Lawal remain. Matching rights essentially is a right of first refusal which allows the company the opportunity to retain the person under contract usually by matching whatever offer is made to them. According to MMA Junkie, most MMA organizations including the UFC, Strikeforce and Bellator have them. The UFC explained its need to retain the rights of those that leave the promotion but in the form of video rights. Essentially, the UFC retains its rights to the images while the fighter was in the UFC. But, it does not explain why it continues to have a matching rights clause for fighters when it does not plan to exercise it. The fact is with all of the injuries, the UFC may have to enforce this clause to retain some healthy fighters for its events.
As a postscript, Roy Nelson sent out a tweet to his followers to watch Lawal tonight on Spike. The UFC probably is not happy about that tweet.
July 23, 2012
Bloomberg Businessweek featured Vince McMahon this week in lieu of Raw’s 1000th episode. McMahon gave his secrets to managerial success in the article.
Some of McMahon’s gems in Bloomberg included: Listen to your employees – and yourself, Treat every day like day one, Don’t cultivate fear, Clean your head and find your zone, Don’t settle for BS answers when interviewing job candidates and Complacency is your worst enemy,
USA Today also featured the company as it made it to 1000 episodes. The article was an overview of the company and how its grown since the first Raw.
McMahon via USA Today:
“Many years ago, I had a chief financial officer say, ‘Vince, you make your money on pay-per-view, so why do all this other crap?’ Without all the other stuff we do, pay-per-view doesn’t work,” says the CEO, whose PPV revenues are up 30% after setting a record with 1.3 million buys for Wrestlemania 28 in April.
We’ll see if these numbers hold true when quarterly results are revealed next month. We already know the PPV buys were lower than 1.3 million.
Despite what some may think about fake wrestling, there’s something to be said about the longevity its had on cable television. It’s somewhat amazing considering it was the early 90s when it first started and the company continues to reinvent itself. I’m not sure if its an achievement that the WWE is the longest-running weekly episodic program in TV history with no reruns or its a testament to the tireless workers in the company.
The WWE had some good publicity leading into its episode 1000. I think the Bloomberg article may be a little fluff considering the horror stories from some former WWE employees about working for the company.
February 18, 2012
Via WWE press release:
Governor Christie was joined by WWE Chairman and CEO Vince McMahon, New York Football Giants President and CEO John Mara, New York Jets Chairman and CEO Woody Johnson, NYC & Company CEO, George Fertitta and WWE’s Senior Vice President of Special Events John Saboor to make the announcement at a press conference held earlier today. WWE Superstars John Cena®, Triple H®, Sheamus®, Mark Henry®, Brie and Nikki Bella™ and special guest Dwayne “The Rock®” Johnson were also on hand at MetLife Stadium for the historic announcement.
The Rock announced that he would be at the NY/NJ WrestleMania although its not known whether he’d be performing or just participating in another way. His appearance can help with the early promotion for the event.
Even before this year’s Wrestlemania in Miami, the WWE has announced WrestleMania XXIX. Its a little surprising considering its held past Wrestlemanias at Madison Square Garden. But, the stadium venue falls in line with the company’s annual biggest event. Its a good acquisition for Met Life Stadium and a dress rehearsal for the Super Bowl which it will host in 2014. Despite what some may think of professional wrestling, the competition to host a Wrestlemania is as tough as it is to get a Super Bowl.
The positive economic impact it has for a city is noticeable as many fans travel to the city of the Wrestlemania and its a significant boost in tourism. The WWE has taken advantage of the event by promoting a week full of events to draw its fans to the host city. According to the WWE press release, “WrestleMania has generated more than $200 million in cumulative economic impact for its past four host regions.”
Last year, WrestleMania was held in Atlanta where it was reported it made a positive $62 million economic impact in the region. Likely, Miami will eclipse this number and next year’s WM in New York/New Jersey should be even more considering the attraction of visiting New York as well as the other activities that one could do in the area.
January 11, 2012
The WWE claims that the brand for WWE pro wrestler John Cena is worth an estimated $106 million in 2010. The report comes out with the announcement of a huge sponsorship deal between Cena and Post Cereal’s Fruity Pebbles.
ESPN’s Michelle Steele reports that Cena was an $106 million brand in 2010. It was confirmed by wrestling site, PW Torch, which added, “In 2010, WWE reported $477.7 million in total revenue, which translates to Cena directly contributing to 22.2 percent of revenue two years ago.” The Torch indicated that its the number it tells corporate sponsors about Cena’s brand value.
Post Fruity Pebbles and the WWE sent out a joint press release (a portion of which is below) to announce the sponsorship deal (h/t Cageside Seats):
Post Fruity Pebbles and WWE Superstar John Cena are teaming up for a new partnership, which includes a collectable cereal box and an instant-win promotion awarding a VIP meet-and-greet with the talent.
Cena’s passion charity, the Make-A-Wish Foundation, for which he has granted over 250 wishes for children with life-threatening medical conditions, and ‘be a STAR,’ the anti-bullying alliance co-founded by WWE and The Creative Coalition, are prominently displayed on newly-designed Fruity Pebbles cereal boxes featured nationwide January through March.
The on-pack instant win grand prize winners will each receive a VIP meet-and-greet with Cena, priority seating and transportation to a WWE live event, and an autographed “Rise Above Hate” T-shirt, in support of the ‘be a STAR’ anti-bullying message. First prize winners will receive an autographed version of the exclusive T-shirt. The second prize winners will receive the exclusive T-shirt. To enter, look inside the specially marked boxes featuring Cena for a special code to submit on www.PebblesPlay.com/Cena.
The sponsorship opportunity arose out of The Rock taunting (in perhaps an improv moment) Cena for his in ring wardrobe calling him “Fruity Pebbles.” And a sponsorship opportunity was born…
The news of Cena’s brand value may seem outrageous to many MMA fans considering he is “sports entertainment,” but Cena attracts mainstream corporate sponsors. In addition to the Fruity Pebbles sponsorship, Cena has deals with Gillettte and Subway. He is the biggest star in the WWE but the biggest decision for the WWE creative team is whether to turn him into a bad guy this year. This seems trivial from an outsider’s perspective but it also means big business when you consider sponsors and for Cena personally as he gets a portion of the WWE’s business including t-shirt sales and (likely) PPVs.
The Fruity Pebbles deals shows how opportunistic the WWE is with its product and its widespread popularity. The WWE probably was not looking for a deal with the cereal company prior to The Rock taunting Cena.
Will there ever be an MMA star with this much appeal and brand value? The UFC is still years away from having a star reach John Cena status. Maybe its unfair to compare but its still an interesting look at how much an individual can mean to a company.
January 5, 2012
MMA Fighting reportsWWE wrestler CM Punk will accompany Chael Sonnen to the Octagon at UFC on Fox 2. Punk, a Chicago native and MMA fan, appeared on an episode of the MMA Hour last year talking about his admiration of mixed martial arts.
Is the Punk appearance good for the UFC? Does Punk’s appearance muddy the lines between the UFC and WWE? Is it a sign of things to come with the new UFC-Fox relationship?
In the end, the Punk walkout may not be a big deal unless Fox picks up on it pre-fight. From a practical standpoint, the pairing of Punk and Sonnen will be an attraction for Chicago. It also makes sense because Punk’s character is anti-hero and Sonnen (in a way) mirrors that persona. But for the casual viewer tuning in for the first time, will they associate MMA with professional wrestling? From the WWE’s standpoint, its good, free publicity for its sport. Punk is becoming one of the top two or three wrestlers in the company and the appearance on network television can only help. Definitely, those anti-pro wrestling people cannot like the fact that the UFC is crossing over (again) into the world of pro-wrestling.
November 5, 2011
The WWE announced its 3rd quarter earnings this past Thursday in a conference call hosted by WWE Chairman Vince McMahon and other WWE executives. Despite beating analysts expectations for Q3 earnings, net income for WWE fell to $10.6 million vs. $14.3 million in 2010.
The WWE announced that revenues totaled $108.5 million as opposed to $109.6 in 2010. A decline of 1%. Analysts expected adjusted net income of $0.15 per share. WWE announced its adjusted net income as $0.19 per share.
One of the bigger questions on the earnings call was the WWE Network announced to debut in 2012. Notably, there was no talk about the recent announcement that there would be a WWE channel on YouTube. So, it appears that the WWE will go forward with an over the air network in addition to its YouTube channel.
McMahon and other WWE executives were quite vague regarding the plans for the WWE Network. But here are some tidbits.
Via Seeking Alpha:
(McMahon) Capital expenditure is about $10 million to $15 million mostly in equipment and construction for our network. And we believe that, obviously we have finally turned the corner on where we are with our network, and we’ll soon be making a very big announcement as it relates to that.
So that we are generally speaking of where we are with the quarter this year. And notwithstanding that, again, we are taking advantage as we always do with all of our strategic opportunities as well as I’ve said before, including launch of the WWE Network, so with that we can achieve meaningful growth as far as that in other aspects of our company is concerned.
We expect our fourth quarter 2011 results will reflect $46 million in startup operating expense and $10 million to $15 million in capital expenditures for equipment and construction. This investment will provide space for additional staff and production equipment and allows for a redesign of enhanced interactive website to support a full range of network programs.
- McMahon indicated that the network would not partner with distributors. The network will be wholly owned by the WWE.
- WWE entered into a revolving credit agreement of $200 million based on favorable conditions in capital markets. Although the WWE indicated no plans to borrow at the time, it could utilize the agreement for the WWE network.
- Q3 saw an impairment charge of $5.1 million coming from its film division
- PPV buys increased domestically by 3%, TV ratings were flat compared to Q2 and live attendance saw a 6% decline.
- Excluding the impact of the film impairments in the current quarter, Adjusted Operating income was $21.0 million as compared to $20.3 million in the prior year quarter. Adjusted Net income was $14.1 million, or $0.19 per share, as compared to $14.3 million, or $0.19 per share. (via WWE press release)
- Although the WWE announced a shift in its business strategy earlier this year. there are no threats of a takeover.
- Analysts actually take issue with the WWE’s creative team as it cites the lack of taking advantage of wrestler C.M. Punk’s anti-hero storyline. However, the return of The Rock to the WWE this quarter, it should help with ratings. McMahon addressed the fact that the WWE could address these “creative challenges”
WWE stock price was up to $10.70 but closed down slightly for the week at $10.58.
October 24, 2011
The Atlanta Business Chronicle reports that this year’s Wrestlemania brought a $62 million economic impact to the area according to an economic research study by the WWE. This is a record for the WWE and a $17 million increase in economic impact from last year’s Wrestlemania in Glendale/Phoenix, Arizona.
This year’s Wrestlemania, which featured the return of Dwayne “The Rock” Johnson, garnered almost $8 million in taxes for the area. A portion of the impact relates to the increase in out of state visitors staying in the area for the event.
Darren Rovell also tweeted that the WWE’s impact equated to 621 full-time jobs in Atlanta.
The study is being released a week before the WWE announces its earnings for the third quarter. So, maybe a bit of public relations by the WWE. The reported financial impact on Atlanta is similar to the boon Toronto received for UFC 129 and is good news prior to its earnings call. Obviously, one may argue the economic impact report is skewed since the study was done by a Stamford, Connecticut firm (where WWE headquarters is located) likely commissioned by the WWE. But, it shows the importance of the live event is to the UFC and WWE. Both have added to the live experience through Expos at big events which allow consumers more access and touchpoints to its brands.
October 12, 2011
TMZ broke the news that Brock Lesnar would be a character in the new WWE video game, WWE ‘12. Dana White told TMZ that he was “fine” with Lesnar being in the game.
Lesnar indicated that he would not have agreed to the WWE video game unless gave him the ok. In addition to the news, Lesnar told ESPN in an interview to promote the game that he could see himself back in the WWE for one match.
Brock Lesnar Via ESPN:
I think I will. I think under the right circumstances I will. I think if Vince McMahon and I were able to sit down at the same dinner table and break some bread that we could come up with some kind of game plan. At the end of the day, I’m an ultimate fighter. That’s who I am and that’s who I’ll always be. I was an entertainer but at the end of the day, I’m still as real as it gets. I think a lot of things have to fall in the right places for something like that to happen.
Here is the Brock Lesnar trailer for WWE ‘12. Notably, the video comes courtesy of Paul Heyman.
And here is Dana White being asked about Brock Lesnar in WWE ‘12:
WWE ‘12 will be available November 22nd – just in time for the holidays.
White dismissed any notion of confusion between UFC-WWE by having Lesnar in the WWE video game. He did state that it would be an issue if Lesnar wanted to wrestle while still under UFC contract. This is interesting considering Lesnar’s comments to ESPN. Of course, the Lesnar interview could be part hype for the video game. It could also mean that one day, after his UFC contract expires, Lesnar would go back to the WWE.
For White, granting Lesnar the opportunity to appear in the video game takes nothing away from the UFC business-wise right now. However, Lesnar’s appearance in the WWE video game may mean his departure from the UFC in the not too distant future. Lesnar has been the UFC PPV draw the past three years garnering over 1 million buys each time he fights. Without Lesnar, only Rashad Evans has had PPV success of over 1 million buys since 2008. (source: MMA Payout Blue Book). With Evans on the shelf again and Lesnar scheduled for a showdown with Alistair Overeem for UFC 141, the UFC might be concerned about its PPV business after 141. Certainly a Lesnar-Overeem matchup will do over 1 million buys. But, if Lesnar decides to leave in 2012, who will step up as the draw that could garner over 1 million PPV buys.
Notwithstanding the 1 million PPV buy threshold, the UFC may be concerned with its PPV business. With the UFC falling back with its scheduled time for PPVs, it hopes that the 2012 PPV business will be much more successful than this year.
April 9, 2011
World Wrestling Entertainment announced that it is changing its name to WWE in a rebranding effort that includes a new business strategy. The purpose of the change is to “better reflect the company’s global entertainment offerings.”
Two key components to WWE’s brand expansion will be the active pursuit to acquire entertainment content companies and the outsourcing of WWE’s core competencies – television and film production, live event production and licensing. As part of the new business model, the company will also focus on the development of new television products including scripted, non-scripted and animated programs, as well as the launch of a new WWE network in the next 12-18 months. The first new program of the brand expansion is Tough Enough®, WWE’s non-scripted program that debuted on the USA Network on Monday.
This new rebranding initiative will be highlighted through a national consumer and business-to-business advertising campaign entitled “Bigger. Badder. Better.™” The campaign kicked off at WrestleMania® XXVII on Sunday and will be featured on cable TV, print and online.
More from the LA Times:
The moves come as WWE looks to rebound from a tough end to 2010 that saw attendance at its events and pay-per-view revenue both drop 15% in the fourth quarter. The declines were blamed on the economy, although WWE probably didn’t help matters by raising prices at a time when its core audience was feeling the pinch.
There is some skepticism of the expansion outside the ring as well as concern that the WWE is losing some of its market share to MMA.
“I think that the most important thing right now is the return of the health of the core business,” said Jay Kaplan, portfolio manager for Royce & Associates, which holds about 9% of WWE stock. “One of the market’s big concerns is are they losing market share to real fighting,” Kaplan added, referring to mixed martial arts and ultimate fighting.
The WWE new strategy is risky. But, it is familiar with taking risks lest we forget the XFL. How much of the refocusing has to do with the fact that MMA has taken some of its core audience? The timing of the move is curious considering the financials. There are some positive signs: Wrestlemania 27 was a success, the debut of Tough Enough received good ratings and the WWE will see a boost with The Rock back. Prior to the refocusing of its business strategy, there were plans of further international expansion. Als0, its film division has made stars out of some of its in ring talent (e.g., John Cena, The Big Show, Triple H).
Dropping “wrestling” from its name may benefit the company in working with mainstream companies. If it is to extend its brand and compete with the likes of AEG in live entertainment production, the name change could help.
Another intriguing aspect of this is the development of a WWE network. With a vast wrestling library at its disposal, it would not be far fetched to create a network. This could be the blueprint for the UFC to one day have its own network.
One final interesting bit from the LA Times piece is the question of whether the rebranding effort will attract a bigger company to purchase the WWE. Vince McMahon denied this is the reason for the new strategy. It would seem unlikely that this would be the case knowing how hard McMahon worked to build the WWE.
February 15, 2011
Dwayne “The Rock” Johnson’s triumphant return to Monday Night Raw to announce that he will host Wrestlemania XXVII was fueled by Johnson’s Facebook page. In fact, a recent article on social media blog Mashable spoke with WWE’s digital team to discuss its social media strategy.
The WWE identified 4 parts to its strategy.
- Learn from the evolution of web usage
- Produce original content for its sites
- Extending the storylines from the television shows
- Building the brand of individual stars
Some interesting takeaways from the Mashable article:
- WWE claims an online fan base of about 14-15 million unique site visitors globally. Its fans are vocal and passionate and spent much of their online time of social sites, primarily Facebook,
- The WWE digital strategy team takes a strong stance that it’s important to go where “people are nesting,” instead of spending marketing dollars to cajole them to consume branded content within the confines of the WWE web site. On that principle of going where the people are, WWE has focused its efforts on making sure its content is available on the key social sites where its community is flocking, namely Facebook, Twitter and YouTube.
- WWE produces about 1,500 unique pieces of content for its website per week, which it then optimizes across its social sites.
- On Facebook, WWE maintains 108 unique pages; including the main WWE page, Stand Up for WWE, pages for most of its top talent and pages for individual TV shows.
While the UFC is the industry leader in social media when it comes to MMA, the WWE is the gold standard. Obviously, the two organizations have differences as the WWE strategy is predicated on the fact that the organization operates in unison. Meaning: its sports entertainment and the matches are predetermined. Thus, it can advance its stories and determine future matches and use its entire complement of social media to promote the events. The UFC (or Strikeforce as we saw this weekend) cannot predict who will win, lose or will be out with an injury. In addition, I assume that the WWE has many more people on staff dedicated to social media. Also, it has a vast global reach, something the UFC aspires to do.
An interesting take from the article was that the WWE attempted to make its own community web site: WWE Universe. The site was fueled entirely by WWE fans. From April 2008 to January 2011, 750,000 fans created accounts but the WWE decided to shut it down as it found that the Facebook pages received more traffic.
Dwayne Johnson’s web page has over 1.6 million fans and the number probably increased dramatically after The Rock announced his Facebook address live on Monday Night Raw. The Rock’s appearance last night even received a tweet from UFC head Dana White in which he tells his followers to follow The Rock on twitter. The Rock’s twitter has been up for one day, with only four tweets. Yet, he already has 84,468 followers (as of 9:56 am west coast time).
As an aside, I was flipping channels and caught The Rock’s appearance and could not turn the channel. Even seven years removed from wrestling, everyone remembers his catch phrases and the fans were in the palm of his hand.