Ch. 12-Services and Nonprofit Organization Marketing

Ch. 11- Developing and Managing Products

The UFC as a product has come a long way since its inception; the fights went from being available strictly on satellite TV Pay-per-view to now being available on a variety of mediums such as cable, satellite, and even YouTube.  On a normal UFC fight card, there are usually around 10 fights per event.  However the main card (PPV event) is only the last four fights since those athletes are the main attraction.  Unknown and up and coming fighters usually have to fight earlier in the fight card, and as a result do not get much publicity.  In order to help the development and marketability of a fighter, the UFC began airing these "Preliminary Fights" on a variety of medium for free.  Without a network deal, the UFC had to be creative in order to show these fights to fans.  The first medium they decided to use was the social media website Facebook.  By "Liking" the UFC Facebook page, people are given access preliminary fights for free.

Facebook Prelims are available to those who "Like" the UFC Page

Not only did this idea give unknown fighters the exposure they needed to gain followers, but it also boosted the UFC's social media presence.

Ch. 8 - Segmenting and Targeting Markets

Last Saturday, fight fans were treated to an amazing line up of events! The UFC hosted live events in Belfast, Ireland and Brazil; meanwhile their rival Bellator MMA hosted their own event in California. Not only that, but a highly-anticipated fight between Sergei Kovalev and Andre Ward also happened on the same day.  

Kovalev vs. Ward

UFC Fight Line-up last Saturday

Why would these promotions host events on the same day as their competition?  Well unless you are a fight fanatic like me, you wouldn't watch all these fights (I watched all these fights live) as they are for a different target market.  For example, the UFC event that was hosted in Ireland was aired live, meaning the first fight was shown at 9 in the morning for us Americans.  I talked about the over-saturation of UFC events on a previous blog post as the UFC begin to introduce their product to the overseas market; however the UFC's expansion will benefit fans that live outside the USA, as they are treated to live events.

Ch. 15- Marketing Communications

The UFC has finally done it! For the first time ever, the Ultimate Fighting Championship has successfully hosted an event not only in New York City, but in the "Mecca of Boxing" Madison Square Garden.

UFC 205 Fight Line-up

The Mixed Martial Art promotion's promotional mix was crucial to making this event the largest the organization has ever created.  Not only did the UFC have to convince the people of New York that the sport, which was just recently legalized in the state this year, would help out the state financially in terms of revenue and tourism, but it also had to create such a large spectacle to ensure people were buying the event tickets, some of which cost up to $18,000 per seat.  The fighters did an amazing job of creating a buzz for the event, walking the streets of New York City and taking pictures with fans.

In the end the organization's hard work paid off, as they were able to break the all-time MSG live gate record, bringing in $17.7 million as compared to the previous record of $13.5 million set by Lennox Lewis and Evander Holyfield.

Ch. 10 - Product Concepts

I've been a mixed martial arts fan for almost a decade.  The first event I ever watched was a fight card from a promotion named PRIDE Fighting Championship.  Since then I have followed other organizations like Strike Force, Bellator MMA, ONE FC, World Series of Fighting, and of course the the most popular one the Ultimate Fighting Championship (UFC). 

 

World Series of Fighting

Bellator Fighting Championships

 It is now the year 2016 and Mixed Martial Arts (MMA) is pretty much a main-stream sport.  However, if I were to ask a majority of any fight fan about their knowledge of MMA news and events, the only events or fighters they can mention are those who are part or who were part of the UFC.  There are plenty of world-class athletes from different organizations, but the UFC has done a great job of ensuring their promotion's brand is considered the "major-league" of mixed martial arts.  Brand loyalty to such an extent works for the UFC as they are able to deliver high quality programming from its inception to today.  

Ch. 17 - Personal Selling and Sales Management

Although the UFC would want nothing more than to sell more than 1 million pay-per-view buys per event, I believe it is close to impossible with their current sales model.  First of all, their revenue is based on single-transaction purchases made from events they schedule on a specific calendar date.  For example, if a casual mixed martial arts fan saw that his favorite fighter is fighting on an upcoming UFC card, he only needs to purchase that one event and is not pressured to buy the next upcoming event.  As I have explained in my previous blog post, this pay-per-view model does not work in most countries all over the world, which limits the UFC's profit margins.

The World Wrestling Entertainment (WWE) is a sports entertainment organization that also used to run on a pay-per-view model.  However in 2011 they introduced a subscription-based video streaming service which includes every programming they offer.  This move was a success, as they now have over 2 million subscribers that pay on a monthly basis.  Guaranteed revenue is what the UFC needs, and if they follow the WWE model I believe they can real a broader target market.

The WWE Network lets you watch all WWE content for one flat monthly rate.

Ch. 16 - Advertising, Public Relations and Sales Promotion

The salary of mixed martial arts fighters vary, from Connor McGreggor's $3 million show money for his fight with Nate Diaz in UFC 202 to Donald Cerrone's $170,000 in that same event.  Keep in mind that these fighters have to pay managers, their gym and sparring partners, as well as medical expenses that their promotion's medical insurance will not cover.  In order to break even, most fighters obtain sponsorship from a variety of different companies.

Donald Cerrone wearing shorts with sponsors.

However with the new uniform policy of the UFC, fighters are no longer able to wear apparel with their corresponding sponsors.  Due to signing a multiple year contract with Reebok, the UFC now requires fighters to compete in Reebok "Fight Kits" in an attempt to standardize the uniform policy of its fighters.

Donald Cerrone wearing the Reebok "Fight Kit". Notice the lack of sponsors.

The UFC does share its earnings it receives from Reebok, however the fighters still make more money wearing shorts or gear with their sponsors on them.  In a Yahoo article written in May, 2015, Cerrone reveals that he stands to lose at least $60,000 in sponsorship earnings as a result of him not being able to step out with his sponsors on his shorts.

There is the argument that the UFC-Reebok deal legitimizes mixed-martial arts as a sport on the same level as NBA, NFL, and MLB; however in the time that the deal was made in the year 2015 and present day, I would tend to disagree.  The shorts and shirts is not what makes the fights exciting, it's the fighters themselves.  The people that will pay to watch Ronda Rousey or Jon Jones were not concerned about whether or not they are wearing brand-name shorts they recognize, they watch because they were enticed by the fighting style, the trash talking, and the entertainment value MMA fighting brings that no other sport can deliver.