Report: UFC sponsorship revenue up due to new deals with companies

March 12, 2019

Last week’s Sports Business Journal included a report by Terry Lefton about the UFC’s 25 percent increase in sponsorship revenue largely championed by new deals signed by the company.

Coming in with a heavy debt load after WME’s acquisition of the UFC for approximately $4 billion, the new owners felt pressure to produce.

In speaking with the UFC’s senior vice president of global partnerships Paul Asencio, the UFC’s partnerships with Modelo, Kraft Heinz (for its Oscar Mayer P3 “official protein snack” and Devour as “official frozen food”) a global rights deal with Nemiroff Vodka, an official poker partner in PokerStars and a large renewal with Monster Energy have helped the company with the increase in sponsor revenue.  In addition, it has forged deals with Motel6, Trifecta Nutrition, Blackheart Premium Spiced Rum, Van Heusen and BodyArmor all since the company was purchased by WME.

Certainly, the UFC has worked on brokering more partnerships with bigger brand companies and segmenting some of its sponsors to cater to different regions across the globe.

Payout Perspective:

There are still more categories for the UFC to fill with sponsors including automotive, insurance and gambling/sportsbooks which all should garner lucrative deals for the company. In addition, the report includes the possibility of looking into the CBD oil category from cannabis business as that industry is starting to grow. The partnership with ESPN will help attract new partners as well.

Payout Perspective: UFC debuts on ESPN

January 22, 2019

Welcome to a special edition of Payout Perspective.  We take a look at the UFC’s debut on ESPN and ESPN+ this past Saturday at the Barclay’s Center in Brooklyn, New York.

Cejudo KOs TJ in R1

Henry Cejudo may have saved the UFC Flyweight Division as he knocked out T.J. Dillashaw to retain his flyweight title.  Cejudo stunned Dillashaw with unassuming punch which knocked the bantamweight down. From there, Cejudo swarmed Dillashaw and the ref stepped in.

From first look, I thought that this was a quick stoppage as they usually allow a little more action for the fighter to recover in championship matches.  But after watching again, with less than a minute gone by in the round there was no way that Dillashaw could have held on and/or recovered.

Cejudo becomes the first champ to receive the new (and maybe controversial) UFC redesigned belt.  He also received props form Nikki Bella which may have been the biggest payoff. While Joseph Benavidez may be the next in light in the flyweight division, its clear that Cejudo would like to take this momentum and challenge Dillashaw for his 135 pound title.  One would think that Dillashaw will want a rematch as he claimed that the stoppage was too soon.

Hardy DQ’d in UFC debut

It was a controversial decision to have Greg Hardy fight on the ESPN debut.  It drew even more raised eyebrows when the UFC put him in the co-main event of the evening especially when you had Paige Van Zant and Donald Cerrone and Alexander Hernandez on the card as well.  Yet, Hardy faced Allen Crowder in a Heavyweight matchup.

While the imposing Hardy may have intimidated on the regional scene, it was Crowder that taunted the former football player.  But it was a knee to the head of a grounded opponent which, as Daniel Cormier described was “very illegal.”  There was no way for Crowder to continue after the knee and it was a disqualification.

Inauspicious debut for Hardy although the UFC does see something in him.  He is still a controversial figure considering his lack of contrition for his past domestic violence past.  We shall how the UFC books him in the future.  One thinks he will be a “Fight Night” athlete until he gets some more seasoning.

Attendance, Gate and Bonuses

The Barclay’s Center drew 12,152 fans for a gate of $1.23 million.  The last big UFC event at the Barclay’s Center was UFC 223 in April which drew 17,026 for a 3 million gate. Prior to that, UFC 208 in February 2017 which drew 15,628 for a gate of 2.275 million.

In comparison, the UFC’s debut on FS1 on August 21, 2013 drew 12,539 for a gate of $1.53 million at the TD Garden in Boston.  The main event was Chael Sonnen as he submitted Shogun Rua.

Pre-Fight Promotion

Having ESPN as a television partner dramatically increased the marketing and promotion of the event.  The UFC Countdown show for UFC 232 aired on ESPN and starting at the beginning of January you saw the UFC creeping into the network.  The fight library entered the digital platform for ESPN and during Fight Week there was a plethora of fights airing on ESPN2 and other networks.

Dana White did the ESPN car wash and was also on the Jimmy Kimmel Show among other outlets for the event.  ESPN+ also had a very good (if you could find it) shoulder programming featuring Dillashaw and Cejudo.

It was interesting that the criticism of having Greg Hardy and Rachael Ostovich died day during Fight Week.  This could be in part due to ESPN controlling the narrative and the airwaves and the casual ESPN media person not knowing much about the sport.  ESPN Outside the Lines did do a piece on Hardy but outside of that, there was not much else.

Sponsorships

The sponsors in the Octagon included Monster Energy sharing a post with Fastrac, Modelo, Toyo Tires, Nemiroff, Blackheart and Monster had the center of the Octagon.  ESPN+ was visible with signage in the Octagon as well.

UFC sponsor Van Heusen secured signage in the area where the corner stands outside the Octagon.  A new place for sponsors.

The prep point was given a new name and was sponsored by P3,

Also, Body Armor had all the water bottles and corner stools.

Paige Van Zant, who was dropped by Reebok prior to her fight on Saturday, picked up a new sponsor with Liv Body.

Odds and ends

Steven A. Smith on the broadcast was cringeworthy but he was not an embarrassment.  He relied on Michael Bisping and Daniel Cormier to do a bulk of the legwork when discussing the fight.  In addition, I thought Trevor Wittman did well as an “expert” chiming in on fight strategy, etc.

The pacing could have been better but it was on par with what the UFC did on Fox.  Notably, there were commercials on ESPN+.

It could have been a little confusing for fans that had to switch from the digital platform to see the early prelims, then watch the prelims on ESPN and then tune back on plus to get the main card.  Hopefully, they will avoid doing this in the future.

We’ll get to see the ratings for this event in the next day or so, although I would think it had to do well over 1 million viewers.

The lead-in to the ESPN portion of the Prelims started 12-15 minutes late.  Fortunately, the college game featured Duke-Virgina, a battle of two of the top 5 teams in the nation.  There was also an early NBA game on ABC which promoted the UFC card too.

The UFC had over 1 million google searches on Saturday which came in second to Chiefs with over 5 million which related to the Kansas City-New England game.  Greg Hardy and Paige Van Zant had over 200,000 searches.  Donald Cerrone had over 100,000.

UFC 228: Payout Perspective

September 12, 2018

Welcome to another edition of Payout Perspective.  This time we take a look at UFC 228 which took place at the American Airlines Arena in Dallas, Texas.

Woodley submits Till

Tyron Woodley used a D’arce Choke to earn his BJJ Black Belt and retain his UFC welterweight belt.  Woodley submitted Darren Till and earned a performance bonus.  Despite the belief by many that Till was the contender to dethrone Woodley, the champion had little difficulty with him.

Next up for Woodley looks to be Colby Covington.

Mottano stripped of title

The second title of the evening was scrapped due to Nicco Montano being sent to the hospital presumably as a result of trying to cut weight.  As a result, her fight with Valentina Shevchenko was taken off the card and Dana White stripped the TUF winner of her flyweight title.  Shevchenko will have the opportunity to fight for the flyweight title at a yet to be determined date.

Stripping Mottano of the title hurts her pay scale since she now will receive only $3,500 from the Reebok Outfitting Policy.  As the champion, Mottano (who never defended the title) would have made $40,000.

Attendance and Gate

The event drew 14,073 for a gate of $1.7 million at the American Airlines Center in Dallas.  There have been 5 PPVs in Dallas and of that UFC 228 was the lowest gate of the 5 held there since UFC 103.

Bonuses

There were a variety of finishes and stoppage for UFC 228 that could have received the $50,000 bonus.  Woodley, Jessica Andrade and Irena Aldana and Lucie Pudilova earned the bonuses.

Ratings

The UFC 228 Prelims on FX were the lowest of the year drawing only 560,000 viewers and peaking with 683,000 viewers.

The prefight show on FX averaged 271,000 viewers according to Nielsen.

The post-fight show on FS1 drew 64,000 viewers.

Sponsors

Fight week saw the announcement of 3 new “Official” UFC sponsors.  Nemiroff became the “Official Vodka of the UFC,” P3 became the “Official Protein Bar of the UFC,” and Blackheart Premium Spiced Rum became the “Official Rum of the UFC” in the US.  Nemiroff and P3 were in the Octagon for UFC 228.  Also in the Octagon was Motel 6, MetroPCS, Modelo, Toyo Tires, Harley-Davidson the movie Predator was also featured and Monster Energy had the middle of the Octagon.

The movie, Predator also sponsored the Embedded episodes.

Toyo Tires sponsored the backstage interview which was seen on Facebook.

Odds and ends


The visual seems to tell the story that most BJJ practitioners know. It’s hard to be awarded black belt in jiu jitsu.

If you watched the Embedded episodes, you may have noticed Woodley wearing a CbdMD shirt which one might infer, he is a sponsor.  In fact, the company sent out a PR release congratulating him.  I’m sure this is something that Woodley and his camp have looked into and ensuring that he does not cross the UFC Anti-Doping Policy.

One of the judges in the Esparza-Suarez fight mistook Suarez for Esparza in the first round and gave Esparza, not Suarez a 10-8.

Xbox put out a tweet gaging interest in the event.

By the way, what was up with the poster? I realize that Till is taller but did they have to make him look like a giant?

This is an ominous tweet with a quote from Shevchenko’s manager.

One might infer that Shevchenko was not paid her fight purse or her win bonus for making weight despite her opponents’ trouble. Once again, this is an overarching issue that manager’s must handle in the contract. Until there is a union, association and/or collective bargaining unit that will address this situation, the athletes are at the mercy of the UFC.

There was a Fan Experience held in Dallas prior to UFC 228 with numerous sponsors and athletes:

There were over 200,000 google searches for Tyron Woodley Saturday.  On Friday, there were over 200,000 google searches for UFC 228.

Conclusion

UFC 228 was an entertaining event with a lot of finishes including Tyron Woodley making it known that he is one of the top UFC stars in the company.  But, going up against two other boxing events on the same night may have hurt PPV purchases.  Also, the big GGG-Canelo fight occurring the following week may have detracted the casual fan on a budget from purchasing this PPV.  It would appear that this event is likely to have drawn around 175,000 to 200,000 PPV buys.

Blackheart Premium Spiced Rum is named the “Official Rum of the UFC” in the United States

September 5, 2018

The UFC has announced a new marketing partnership agreement with Blackheart Premium Spiced Rum making it the “Official Rum of the UFC” in the United States.

The brand is owned by Heaven Hill Brands, America’s largest independent family-owned and operated distilled spirits company.  It appears that the partnership will start with activation around the UFC 25th Anniversary event in November.  However, the UFC and Blackheart Premium Spiced Rum will be co-branded at retail point of sale materials in locations across the U.S. and in various digital and social media ads.

Via UFC press release sent Wednesday:

As part of this collaboration, Blackheart Premium Spiced Rum will have a branded presence inside the world-famous Octagon® and at UFC VIP Experiences during key events throughout 2018-2019, beginning with UFC FIGHT NIGHT®: EDGAR vs. KOREAN ZOMBIE. The event, which takes place on Saturday, November 10, at Pepsi Center in Denver, will be the focus of attention as it also marks UFC’s historic 25thanniversary celebration. The fast-growing Spiced Rum brand will also be integrated across multiple UFC-based social and digital platforms.

Financial terms of the deal were not disclosed.

 Payout Perspective:

A day after the UFC announced its “Official Vodka of the UFC,” it now has a Rum.  Based on the qualifier that it is the “Official Rum of the UFC” in the United States, we may see the UFC sell the assets internationally as well.  As we highlighted yesterday, these new sponsorship categories were made possible after Bud Light’s beer sponsorship lapsed.  This should bring in additional revenue for the company which value has increased according to Dana White.