UFC will continue to review Reebok sponsor deal but not payouts

July 3, 2015

Despite the notable opposition to the UFC’s apparel deal, the “Reebok-era” has begun and according to the UFC, third-party sponsors are sticking with their fighters per a report by MMA Junkie.

While the UFC says it is working with its fighters about the Athlete Outfitting Policy (or AOP for short), the compensation to its fighters will remain throughout the term of the deal.

In an interview with Junkie, UFC Senior Vice President of Global Consumer Products Tracey Bleczinski stated that third-party sponsors are sticking with its contracted fighters.  Bleczinski went on to state that the UFC would continue an on-going review of “all aspects of the program” although it would not review the compensation of the sponsorship deal.  As most know, one of the biggest issues with the Reebok deal is that many of the UFC contracted fighters would be losing out on money from their fight week and fight night sponsors.

Payout Perspective:

Overarching question is why the UFC did not seek input from its contracted fighters prior to entering into the deal with Reebok.  Moreover, did UFC contracted fighters know about the pay structure prior to its public release?  We don’t know the specific answers to those questions but the fact that the UFC says its having “open communication” with its contracted fighters now seems to be an “after the fact” PR strategy.  While maintaining a dialogue is good and perhaps the UFC can make good on some of the criticism from this deal, the execution of its strategy appears flawed.

On another note, it would be interesting to know which third-party sponsors are sticking with its fighters.  We have heard of many fighters losing out on sponsors, but not many sponsors sticking with their fighters.  Notably, Dana White revealed that Venum is sticking with Jose Aldo.  Also, Gegard Mousasi signed a deal with Bridgestone.  But, not many other big name brands sticking with its fighters.  If there are more, please let us know.  Certainly, the third-party sponsor market will be a much tougher sell and managers/fighters will need to get creative to get around the Reebok deal.

UFC-Reebok unveils uniforms

June 30, 2015

The UFC unveiled its Reebok fighter “kits” in a glitzy press conference in New York City Tuesday morning.  Many UFC stars were on hand to model the new uniforms which go into effect starting at UFC 189 next week.

The unveiling included many fighters based on home country and then the champions of each division (except Jose Aldo as he is training in Brazil).  The UFC and Reebok stressed “performance and customization” and fighters that were interviewed talked about how the new uniforms were specified for combat sports.  The uniforms had differing color variations although the design was mainly the same.  Champions in each division wore black uniforms.  Fighter names are on the back of the jersey and country patches are on the sleeves.

During the unveiling, Reebok officials talked about three types of kits: the country kit, a universal kit and a champion kit.  The country kit are specific to the country that the fighter is from including design elements specific to that nation.  The champion kits are the aforementioned black and also have gold and red trim.

There are also walkout wear including hooded sweatshirts, t-shirts, jerseys and sports bras available which will be made available for retail to the public.

Reebok already has UFC apparel on sale on its web site.  Anderson Silva and Georges St. Pierre Reebok gear are available in addition to UFC fighters.  Replica jerseys go for $70-$95 while Reebok t-shirts range from $30-$35.

The uniforms are already finding criticism as there are glaring misspellings and errors on the jerseys.

Payout Perspective:

It was an interesting debut for the kits and we shall see how soon fighters and fans adopt to the new Reebok-branded uniforms.  The country design is an interesting idea as it leverages fans with their loyalty to their country.  Also, the champion uniforms are a nice touch to make them stand out.  While we might debate the design issues, the overaching issue with the Reebok deal is the dent in sponsorship money that many of the UFC fighters will take.  Obviously, it’s something that many fighters have talked about but I’m sure most will not do anything more than this.

Hayabusa becomes official glove for Glory

June 26, 2015

Glory has announced that it is partnering with Hayabusa to be the official competition glove for Glory Kickboxing.  The partnership will begin Friday, August 7th with Glory 23 according to a company release.

The gloves will be revealed to the public during fight week leading up to Glory 23.  The gloves will also be used during the co-promoted show with Bellator on September 19.

Via press release:

“The name Hayabusa is well-recognized by the world of combat sports as the ultimate in performance equipment and technical apparel,” said GLORY CEO Jon Franklin, who helped broker the deal. “Our athletes deserve the very best when it comes to not only their performance and comfort, but their safety, and we feel this deal provides the finest gloves available.”

Payout Perspective:

Hayabusa is one of the many combat sports brands in a state of flux as it navigates the new state of sponsorships in MMA.  The company announced that it would not be at the UFC Fan Expo this year as only official UFC sponsors will be allowed at the event.  With the UFC-Reebok deal, Hayabusa will no longer be in the UFC octagon and the company has shifted its focus.  A recent MMA Junkie article wrote about what MMA brands are doing in light of the UFC-Reebok deal.  For Hayabusa, it meant a 3 year deal with Glory.  The company intends to spend some of its marketing and sponsorship budget usually earmarked for the UFC to Glory and its fighters as well as Bellator.  We shall see what it means for Hayabusa and its business.

Jedrzejczyk signs indivudal sponsor deal with Reebok

June 25, 2015

UFC Women’s Stawweight Champion Joanna Jedrzejczyk has signed an individual sponsorship deal with Reebok per the UFC.  Jedrzejczyk also announced the deal via twitter.

She is coming off her first successful title defense this weekend on a UFC Fight Pass only show from Germany.  With the new deal, she joins Ronda Rousey and Paige VanZant as the only other women with individual sponsorship deals with Reebok.

Payout Perspective:

Perhaps the only bad news for Jedrzejczyk is that she might not be able to show her sneaker collection to everyone.  This could have been an untapped crossover talking point for her but with the Reebok deal she probably could buy more Air Jordans for her collection (although she probably shouldn’t let the public know).  She showed her personality during the Embedded episodes leading up to UFC 185.  Plus, her fighting style is fan friendly.  With her fight Saturday, and the new Reebok deal, it’s unlikely we’ll see her on a Fight Pass only card again.

White downplays fighter concerns about Reebok deal

June 19, 2015

In a recent Periscope chat, UFC head Dana White downplayed the outcry from fighters about the Reebok deal.  White indicated that the fighters are “freaked out” about the change.

White answered a variety of questions including stating that he estimated that UFC 189 should do over 1 million PPV buys.  He also stated that they are filming a new reality show.

Jose Aldo is among the vocal UFC fighters as he states that he is losing a lot of money with the new deal.  White shot back at Aldo stating that Reebok wanted to sign him to an individual sponsorship deal but he chose to stay with Venum.

Payout Perspective:

So is it the contracted fighters’ resistance to change or the reality that the change will affect them financially that is the cause for so many to speak out against the new policy?  It would seem that fighters have a legitimate gripe and speaking out about it may shed light on the issue and affect change.  Or, it will not.  Based on White’s comments, it seems like the UFC is sticking to its policy with Reebok and the UFC is not concerned about opposition at this point.

Late fight cancellations won’t be credited as fights under Reebok deal

June 14, 2015

MMA Junkie sheds some light on the upcoming new UFC athlete outfitting policy with respect to late fight scratches.  The information may add on to the growing discontent about the ills of the new program.

UFC officials indicated that neither fighter officially will be credited with a bout.  Payouts for a cancelled fight will be handled on a case-by-case basis as one fighter or both could still be paid.

The recent example of Rose Namajunas and Nina Ansaroff was highlighted in the Junkie article.  Ansaroff not only missed weight but was a late scratch from UFC 187.  Namajunas was left without an opponent.  Her sponsors had varying contractual responsibilities to Namajunas in light of a cancellation.  Although the article did not state it, it was inferred that some fight-week and in-case sponsors had different financial obligations than lifestyle sponsors. While lifestyle sponsors pay regardless of whether there is a fight, others may not have to pay if no fight occurred.

Payout Perspective:

The article outlines the new challenges facing managers and fighters in light of the Reebok deal.  Perhaps the fact that may have been glossed over but is important is the fact that a fight that is cancelled by either fighter will not be logged as a fight toward one’s total number in the UFC.  Thus, a fighter that could be moving on to the next sponsor pay tier would have to wait until they are called again to fight if their opponent cancels.  It really seems unfair from this viewpoint and stagnates a fighter’s earning potential without even it being their fault.

Aldo criticizes Reebok deal too

June 1, 2015

UFC featherweight champion Jose Aldo is the latest fighter to express criticism concerning the UFC’s Outfitting Policy.  In an interview with Brazilian outlet Combate, it appears that Aldo is in favor of fighters coming together to address these issues.

Aldo indicated that if fighters were organized like the players are in the NBA, the policy would have been different. Aldo states that his arguments are not his but for his teammates that have looked to him for guidance with the new rules.

Payout Perspective:

With all the discontent with the UFC’s new policy, if the fighters had a leader to guide them it would be helpful.  Of course, Aldo as leader has its pros and cons.  While he is a champion in the UFC and should have some leverage, he is not a native English speaker which would make it an obstacle to communicate ideas with most fighters, namely Americans.  Moreover, the idea of an association and/or union are good in theory but what would something like this look if fighters had the opportunity to organize.  Would there be solidarity between fighters or splits between fight camps, fighters, etc.?

Erick Silva to lose $12K after Reebok deal

May 31, 2015

Erick Silva is the latest UFC fighter to voice his displeasure with the Reebok deal.  Silva, who is scheduled to fight at the TUF Brazil 4 Finale in Miami stated that he would be losing $12,000 per fight once the new sponsorship deal is in place.

The comments come out at an interesting time as Silva is seeking to renew his contract with Zuffa and hopes that he improves on his current deal.  Obviously, he hopes to make up the money he will lose in sponsors with his new contract.

Silva fought 3 times in 2014 and is 1-0 in 2015 heading into his second fight of the year in June against Rick Story.

(h/t:  Bloody Elbow and Brazilian outlet Globo Esporte)

Payout Perspective:

Is going public with how much you will be losing due to the Reebok deal good public relations as you go into negotiations for your new deal with Zuffa?  Could his public announcement that he’d like a better deal help his negotiation leverage with Zuffa?  Unlikely.  But, the continued news that fighters are not pleased with the Reebok deal could facilitate another change toward the sponsorship policy.  While it’s unlikely that Zuffa would penalize Silva due to his statements, it might mean that they are tougher in negotiating a new deal with him.

UFC 187: Payout Perspective

May 26, 2015

Welcome to another edition of Payout Perspective.  This time we take a look at UFC 187 taking place at the MGM Grand Garden Arena with two title fights on the card.

Cormier wins Light Heavyweight title

Despite getting knocked down in the first round, Daniel Cormier dominated Anthony Johnson eventually getting a submission over the exhausted Rumble in the third round.  Johnson was visibly gassed by the second round and Cormier took advantage of Johnson when the fight went to the ground.  It’s a great story, as the 36 year-old Cormier finally earned the Light Heavyweight Championship after the UFC stripped Jon Jones of the title.

Cormier gets Ryan Bader next and while Bader’s post-fight press conference antics may have drawn some sparks, not many think Bader has a chance against Cormier.  The real question will be whether Jon Jones will be back by the end of the year for another fight with Cormier.  Perhaps in New York?

UFC_187_DC_Rumble

Weidman destroys Belfort

Chris Weidman established his dominance in the middleweight division by dispensing of Vitor Belfort.  Weidman had been critical of the drug testing leading up to the fight and made a comment about Belfort’s testosterone levels at the weigh-ins and perhaps that spurred him to KO Belfort.

Weidman should face either Luke Rockhold or Jacare Souza next.  The native New Yorker hopes that his next fight take place in the state if it is made legal in Albany next month.

Attendance and Gate

UFC 187 was the best event in Vegas (considering attendance/gate) this year outdoing UFC 182 and 183.  It was announced at the post-fight press conference that the event drew 12,615 for a gate of over $5.1 million.

The numbers are very good despite tickets still being available through Ticketmaster on Friday night and the secondary market “get-in” price softened during fight week (i.e., the demand went down).

Bonuses

Fight night bonuses were awarded to Travis Browne, Andre Arlovski, Chris Weidman and Daniel Cormier.  Browne and Arlovski earned Fight of the Night while Weidman and Cormier drew the Performance of the Night.  All received the standard $50,000 bonus.

Sponsorships

The Octagon sponsors included Bud Light, the movie “Entourage,” MusclePharm, Harley Davidson, Air Force Reserve. Fram, MetroPCS, Toyo Tires, Draft Kings, Bud Light and Monster Energy Drink had the center of the Octagon.

Draft Kings had the fighter prep point.  Harley Davidson sponsored the fighter arrivals.  Rumble Johnson sported a pink bowtie upon arriving to the arena while Daniel Cormier wore sponsor DipYourCar.com.

Donald Cerrone indicated in an interview that he would be losing $60K in sponsor money due to the Reebok deal.  At least for one more fight, Cerrone was able to rep his array of sponsors including Monster Head Phones, DipYourCar.com, E-Z Go, Qore24, Hunt Brothers Pizza, Monster Energy Drink, Budweiser, Greenlee, Ollie’s Bargain Outlet and Red Digital Cinema.  It appears that having Kevin Harvick’s agency representing Cerrone has helped him with sponsors as the Cowboy has a lot of them.  Cerrone will likely be able to keep official UFC sponsors, but he will be losing out on the others unless he can coordinate agreements outside of the Octagon and UFC fight weeks.

Fear the Fighter owner, John Makdessi, did not wear his clothing brand but was sponsored by Topps.

Joseph Benavidez was sponsored by Sling Shot.  In the link, you can see what the product does.  Very interesting sponsor for Benavidez.

Odds and ends

The UFC Prelims were threatened to be shuttled to FS2 due to an extra innings MLB game but it abruptly ended right before the first Prelim fight started.  Despite a 5 or 6 minute delay in broadcasting, no fights were lost on the FS1 broadcast.

With the NBA and NHL Playoffs starting during the last hour of the UFC Prelims, it will be interesting to discover the ratings for the event.

Best shot of this set of Embedded episodes:  Anthony Johnson sitting next to an old woman in the waiting room of a colonics center.

What became of the agent/manager meeting this week?

It was interesting that the UFC promoted the Periscope App as the promotion wanted fans to follow Dana White and his videos.  Of course, many people are using Periscope to shoot video of the event itself.  It will be the next big First Amendment issue in sports.

Joseph Benavidez announced he let go of his management team and fought the fight without a manager.  His move could be a new trend in the future as the Reebok deal goes into effect.

UFC 187 drew 200K plus google searches last weekend.  It was second in the U.S. on Saturday to Golden State Warriors guard Stephen Curry.  In comparison, UFC 182 drew 400K searches and UFC 183 drew 500K searches.

Conclusion

While google searches are not definitive as to PPV buys, it is a good indicator.  If that is the case, UFC 187 likely did not fare well.  Even with two title fights, the buzz for this weekend was just ok.  How much would have Jon Jones added to the card?  If Weidman can remain healthy and fight on a consistent basis, he could be a PPV attraction.  At this point, he’s a wait and see fighter. While the google searches indicate a low PPV buy rate, I am predicting it does somewhat better: 450-500K PPV buys.

Cerrone to lose out on sponsor money after Reebok deal

May 20, 2015

Yahoo! Sports reports that Donald Cerrone is set to lose $60,000 in sponsorship money due to the new Reebok sponsorship deal.  However, Cerrone appears ok with it.

Almost 2 years ago, Cerrone signed on with Kevin Harvick’s sports agency and picked up some key non-endemic MMA sponsors which include Budweiser and Fram.  Notably, both are UFC sponsors (Bud Light is the actual UFC sponsor although I am not sure if there is a true difference in sponsorship between Bud and Bud Light).  He also has had golf-cart operator EZ-Go and others on his shorts in the past too.

Despite losing the sponsor money, Cerrone remained upbeat about the change in policy in the UFC.  He acknowledged he will not make the “big money” but thinks it will work out.  He stated that his sponsors will stick with him despite the shift.  Of course, Budweiser and Fram are official sponsors so this helps.  He noted that the deal with Budweiser is for a year and appears to be guaranteed regardless of whether or not he will wear it to the ring.

Payout Perspective:

Interesting to note that the article mentions that one other UFC official sponsor will be on the Reebok uniform along with Reebok.  One might suspect Bud Light or Fram would get rotating spots on the uniform at some point.  Cerrone is in a unique position as he has secured individual sponsor deals with official UFC sponsors so those relationships are more likely to remain intact.  But, does anyone find it odd that Cerrone remains upbeat about the sponsor deal despite losing money?  He is one that has admitted to spending money once he receives it which is one reason that he is willing to fight anytime, anywhere.  So, if he’s losing money on this deal, wouldn’t you be a little upset?

Fortunately for Cerrone, he is a crowd favorite and one could see a crossover with NASCAR and perhaps making appearances at NASCAR events for a sponsor like Fram or Budweiser or another non-UFC official sponsor.  Thus, he can still make money outside of the Octagon without having to wear a patch on his shorts.

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