Courtesy of www.econmatters.com.
|George St. Pierre|
The UFC (Ultimate Fighting Champion) has really grown as an organization through its acquisitions of competing organizations like the WEC and StrikeForce, the WEC enabled the UFC to add lighter weight divisions to its roster of PPV telecasts, and StrikeForce helps consolidate the industry further, and build the UFC`s roster of fighters.
All in all, the UFC has done such a good job of legitimizing the Sport that the UFC name has become synonymous with the Sport from a branding perspective a la Google in search.
The Sport of mixed martial arts (MMA) has garnered more mainstream interest over the last five years as well with more sponsors willing to associate themselves with the product, the ability to put on shows in new cities and countries around the world each year, and the number of new training and teaching facilities that have opened up due to rising interest from the demand side by participants globally.
However, there is one area that the UFC could improve upon their obvious success and take the Sport of mixed martial arts to the next stage of development, and that is the vaunted Super-Fight. Boxing, a similar sport in terms of market dynamics and natural comparisons has a long and storied history of promoting the Super-Fight with such classics as Ali-Frazier, Hearns-Leonard, and the potential for another mega Super-Fight with Mayweather-Pacquiao.
Mixed martial arts and the UFC are still relatively young in terms of mainstream marketing appeal and experience but at least they are heading in the right direction as opposed to boxing which has been steadily going in the wrong direction for the past twenty years.
However, this isn`t the time to rest on your accomplishments, and let goldmine marketing opportunities go by the wayside, and the UFC is in danger of doing just that with their failure to pull off the Super-Fight. The Super-Fight pulls in the more casual fan, and the better the marketing campaign and hype machine execution, can even garner new audiences who would never even consider watching the Sport a la the Super Bowl each year in Football.
There is one fight that would move other sports from the ESPN lead on SportsCenter and that would be a matchup between the two most marketable fighters in mixed martial arts Georges St. Pierre and Anderson Silva.
|Anderson Silva with Justin Bieber|
Think about it, if Justin Bieber brings Anderson Silva to dance on-stage during a Pop music concert, then there are mass marketing opportunities and new distribution channels to be tapped in pulling off this Super-fight.
And as recent news points out with Georges St. Pierre developing an injury and having to cancel his latest championship fight with Carlos Condit, opportunities are short lived in such a rigorous sport with both athletes on the other side of 30, any fight can for all intents and purposes be their last inside the Octagon.
The UFC needs to make this fight happen tomorrow, or in other words, the next fight for both fighters, as they are both coming off on an injury and are rehabbing as we speak. So a good date would be something like March 3rd 2012, in between the Super Bowl and the start of March Madness in college basketball.
The fighters are both long time title holders in their respective divisions, they are in adjacent weight classes, and a fight can most easily take place at the 185 pound weight class without much difficulty considering Georges St. Pierre walks around at 195 pounds these days, and is considered very large for his current weight class.
Furthermore, sure St. Pierre may give up some size advantage to Anderson Silva, but St. Pierre would have a speed and quickness advantage coming from the 170 pound welterweight division. And as Frankie Edgar has demonstrated on numerous occasions strictly size advantages do not translate one for one in fights as he consistently beats much larger opponents in the Octagon.
The real reason this fight hasn`t taken place yet is about money. Let`s be honest here the fighters are close enough in all areas from weight, size, and abilities to get a fight between the two champions if the money was right. And this is where the UFC has been severely shortsighted in how they run their organization. The phrase penny wise and pound foolish comes to mind regarding the UFC`s approach to paying fighters in general, and this Super-Fight in particular.
In general, UFC fighters are poorly paid relative to other sports, part of this is an immature marketing sport, i.e., the sport is relatively young from a sponsor’s perspective, and they are just now making inroads to bigger television markets with the Fox deal. But also the UFC is “overly economical” when it comes to paying fighters, any company that can generate the type of PPV numbers consistently to put on the number of events each year that they do can pay the fighters more money.
In short, the UFC is getting better about paying fighters more as the sport progresses, they are even trying to tie pay to performance with increasing fight bonuses, but they still have a long way to go in this area.
The real reason the UFC pays fighters what they do is because they can, the market dictates rate based upon competing opportunities, and fighters have limited organizational choices at the moment from a negotiating standpoint. We don`t have to cry rivers for fighters as relative to other jobs in this economy there are some wonderful opportunities for these professionals, especially with their own sponsorship and ancillary marketing endeavors.
My point here is that the UFC might be better served in the long run by paying fighters more, maybe even subsidizing fighters to bring more talent into the sport from the other competing sports like football, baseball, and basketball. The UFC is still basically a family run business, and not a public company, and so they are probably operating from a shorter term business perspective that will evolve as they mature.
But this overly conservative economic approach to expending resources with regards to fighters is what specifically has to date prevented the Silva-St Pierre Super-Fight from taking place, and it is penny wise and pound foolish.
It is obvious that one or both of the fighters would have to take considerable risk here in this fight. Unfamiliarity is always a risk, Georges St. Pierre would have to risk going up in weight, and possibly losing his size advantage that he currently has within the welterweight division, so of course he wants to be careful in giving up such an advantage to an opponent, and possibly losing future income by incurring a loss to his established legacy.
This is where money comes into play, the UFC needs to compensate both the fighters to take this risk, because one of the fighters is going to incur a loss, and do some damage to their legacy and marketing appeal as a brand. This is the real reason the fight hasn`t taken place already. Both fighters want to maximize their present brand in cleaning out every single possible money fight in their current divisions.
But this is short sided for the UFC because they need to be bigger than the individual fighters from a marketing standpoint, and that means reaching larger audiences that only a Super-Fight can generate in order to grow the sport into a larger marketplace penetration down the line.
The UFC needs a fight that everybody wants to see, to have cab drivers hyping the fight, to have a fight where football players don`t care about the game, they want to get to a location to watch the PPV. A fight that captures the public`s imagination, a fight that can be hyped from a media standpoint, with a media road show where fighters go on Jay Leno, ESPN, Good Morning America, etc.
In short, a fight that Justine Bieber`s audience can get behind, that is where the public consciousness that only a Super-Fight embodies can work its marketing magic, and take the UFC and sport of mixed martial arts to the next level.
Forget what it costs, it doesn`t even matter if net it is a losing promotion, the future dollars are where the real benefit that market awareness and penetration of the Super-Fight can bring the UFC in mainstream acceptance on an entirely new scale than currently exists.
Of course, the UFC doesn`t have to lose money on the promotion, just loosen up the purse strings a little, and make this fight happen. It is a marketable enough fight that the UFC could literally pay both fighters $10 million each and still make a fortune on the fight.
This is where the UFC is shortsighted; no fighter has come close to making $10 million for a fight. The best fighters are in the $650,000 to $1.4 million range for the UFC, and this is for the elite card matchups.
The UFC literally needs to take a blank check and put it in front of both fighters and have them write what it will take to pull this fight off as the window of opportunity and marketing goldmine that this fight brings for the UFC is slipping away as the luster of these two fighters legacy can only go down from here.
In short, do not wait too long, an upset loss, a devastating injury, or obvious deterioration of skill, and this fight is no longer a Super-fight, and just another interesting matchup. Think in terms of Fedor Emelianenko, a seemingly invincible fighting superstar whose luster and marketing appeal vanished faster than a shooting star after a couple of disappointing performances.
In summation, the UFC needs to strike while the opportunity still presents itself, and Super-fight opportunities are relatively rare, and from current dynamics, there is limited upside in postponing this fight any further from a marketing standpoint, and much more downside risk with the potential of losing the Super-Fight mystique altogether.
So UFC pull out the blank checkbook and make this fight happen before it’s too late. As they said in Jerry Maguire; “Show me the Money!” I am sure one or both of the fighters have reservations about taking this fight, and that is understandable from their vantage point, but the mixed martial arts fans want to see this fight, it is insanely marketable right now, and all it will take is the right amount of money to smooth over any fighter reservations, and make this Super-Fight a reality.
In the end, fighting just like most other financial markets and assets, all comes down to the price, what price will it take to move the product, the UFC just hasn`t come up with the right price yet. When in doubt UFC, follow the money!
Further Reading – Our take on the Poker Industry