Dana White recently spoke with ULTMMA on a variety of topics including the UFC’s position on sports sponsorships:
Payout Perspective:
The business model that got the UFC to this point, is not the exact same business model that the UFC needs in order to reach the next level or upper echelon of the sporting world. The kind of growth the UFC is seeking requires revenue stream diversity and expansion that cannot be facilitated by going it alone.
Therefore, I strongly object to the notion that the UFC doesn’t need anybody. They need somebody, not anybody; and that’s probably what Dana intended to communicate.
The fact of the matter is, regardless of whether you call it sports sponsorship or strategic partnership, the UFC is going to need to expand its reach and product availability beyond what its current set of relationships will allow.
A lot of people get caught up in the symbolic nature of what it might mean to have the UFC on major network television, but really it all boils down to increasing viewership for its free product. A product which in turn is the catalyst for boosting the revenue generating effectiveness of the UFC’s PPV events.
Likewise, the advantages to the UFC through sponsorships or partnerships are also complementary to diversifying and expanding revenue streams. Born out of a perceived association between brands, sponsorships can do the following:
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Build the legitimacy of the weaker entity in the mind of the consumer and other businesses.
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Foster the exploration of new demographics through cross-promotional activities.
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And, obviously, generate larger amounts of publicity and awareness as the result of co-operation in the marketplace.
All of which brings me to my final point on the matter: the UFC needs to do a better job of leveraging its existing strategic partnerships. I understand that the UFC goes fairly light on its advertising, but why haven’t they lent their name or personalities to Bud Light or HD commercials? Where are the marketing initiatives? It’s a missed opportunity.
Ask yourself: how are the Bud Light or H.D. brands being used to help expand the UFC brand? If they’re not, then what makes them any different from what Dana explicitly said he doesn’t want out of a sponsor – a pile of money and no working relationship.
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Is it just me, or has this “us against the world mentality” sort of run its course? It helped to galvanize the MMA communtiy for a while, because we were all working together to make a point and prove the naysayers wrong.
Now, however, I can’t help but think that it’s slightly counter-productive. The last thing MMA needs to do is start shunning would-be fans, because they weren’t among the early adopters.
Yes, we told everybody this sport was legitimate. If they didn’t listen – fine. They missed out on some great years. Time to catch up.
By no means can MMA afford to take that attitude that it doesn’t need anybody, nor want anyone that wasn’t here right from the very beginning.
Hell, I wasn’t even here from the very beginning. How many people can actually claim otherwise?
I get what you are saying, but you have to take a look at how the UFC has done in the worst economic times we’ve had in decades. They have done things their way and never caved to outside demands and have turned 40 million in debt to hundreds of millions in profit. Why would they change because their style doesn’t play well to a minority when in reality it’s their way has helped to make them as popular and succesfull as they are today.
People like that us against them mentality, I think it would be a huge mistake for the UFC to go a 180 and change their style. Because in the end the last thing the UFC wants to do is pull a WWE and turn against their fanbase which got them to the point were they were having record buyrates. Dana’s style may insult some but it’s that same arrogance and determination that has stopped them from taking stupid deals and benefited them by not depending on anyone for becoming the ppv juggernaut that they are.
I think the key word here is “Need”. I Agree with him completely. I would love to have a million dollars. But i don’t need it. You only need what would help sustain you or keep you from digressing. Getting to the next level is a want. I think at this point Dana isn’t looking to jump in to some small time deal with a big name. And let them jump ship as soon as they don’t feel the UFC meets their expectations. The UFC wants commitment from their sponsors. A fortune 500 company jumping in to piggyback off the success of UFC 100 for a couple events and leaving is pointless. I believe the UFC is looking to get these sponsors in place. Just because he don’t need them don’t mean he don’t want them and doing everything he can to get them. Just like the fighters. He don’t need anyone particular fighter. But he does what he can to get the big names who hold out all in the name of progress. This isn’t any different.
While the UFC may not _need_ anyone, extra dollars in the bottom line is never a bad thing. Dana has said they’re making buttloads of money and it’s time to give back to the fans. With the UK fans getting free fights out the ying its time the other fans got a good free show, and not just because they can’t market the card successfully in North America.
Now if Dana’s “big announcement” ever actually happens and they DO sign a network TV deal this decade, they need to increase their sponsor profits in order to provide a quality fight card without going in the hole. The fight night events have been somewhat lacking lately (with a few exceptions) and it just seems to be a place where the UFC puts on the fights that most people wouldn’t pay to see (TUF’ers) or just to counter-program the competition.
The UFC needs to strike a balance between bringing in new higher paying sponsors in order to provide a better free product, which will in turn attract new fans to the sport.
Sure, what the UFC has done up until this point has worked…but with a billion dollar operation in the swing they need to start playing things smarter and not turn their nose up at everything so quickly.
Lorenzo it’s time to reel Dana in (again).
Well said, EJ.
The first mistake here is that everyone believes what a promoter is saying. Its in his job description lie, BS, etc, in order to strengthen the UFC brand and give other people they are negotiating with the “idea” that they don’t need anyone to score a better deal.