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ALL BUSINESS: The Ultimate Fighting Championship: You Can't Be Mad at a Brand for Branding
Jan 8, 2010 - 4:57:49 PM ALL BUSINESS: The Ultimate Fighting Championship: You Can't Be Mad at a Brand for Branding

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By Alvin Benjamin Carter III, MMA Torch Specialist

In last weeks article I mentioned UFC President Dana White's statement about the UFC becoming the biggest sport in the world by 2020. A good number of writers have focused in on this statement as of late because the UFC is not sport; it's a brand. Writers have also stated that the UFC should let go of some of their market dominance so there can be more competition providing better fights which I think is good one-off idea when pairing a champion of a cleaned out division with a dominant fighter from another country. (An International Super Fight) I see how fans and critics can be upset because Fedor probably will not fight a hopefully healthy Brock Lesnar anytime soon.

But, let's look at this from a business standpoint before we get too vexed. Follow me on this: How many of you have ever gone rollerblading? Well, you actually were in-line skating. Rollerblade is a brand name. How many of you ever asked for a kleenex to dab a runny nose? Again, you actually asked for a facial tissue. Kleenex is a brand name as well. The point is businesses have to BRAND HARD and BRAND OFTEN. When Dana White says the UFC will be the biggest sport in 2020, you have to realize he is promoting his brand. Not to mention the segment of the market that is not already into mixed martial arts knows the name UFC, but not the acronym MMA. Whenever I tell someone I train and write about MMA, they ask me what's that. Then, I say, "mixed martial arts..." (and a blank stare looks back at me). Finally, the ah-ha moment comes when I say, "Like the UFC or Ultimate Fighting." I am not saying that it should be that way, but it is. If Dana White is speaking to a larger audience than those of us who write, fight, read, and watch MMA, than he needs to go out and reinforce his brand.

Now as far as co-promotion goes, yes, they are protecting their brand. But, there is more to that story. A few articles back I analyzed some rough revenue numbers on how much the UFC made last year on PPV event orders and gate ticket sales. Combined they brought in almost $390,000,000. That is for thirteen PPV shows in a year. They have money, and a lot of these other promotions do not have money like that. The type of co-promotion to get Fedor on a fight card might not look that tempting since:

1. The UFC will have facilitated the event by securing the venue, matchmaking the majority of the fight card, pay the fighters, setting up all ring and technical/camera/lighting equipment. Basically, the overhead is still the UFC's responsiblity since I am sure Fedor/ M-1 is not going to pay to fight.

2. The UFC will pay a large amount to a fighter (Fedor) that they have no official stake in.

3. There is a chance Fedor could win the belt and the UFC might have to co-promote more often than they would like.

Think of it like this. Your local pizza place (let's call it Joe's Pizza) makes the best pie in town, but somehow Pizza Hut has three locations in your town and people run to them. Does it make sense for Pizza Hut to say we will facilitate the making of Joes' Pizza pies, put Joe's name all over their promotional materials, and then pay Joe based on how many of his pizza's we sell? Then Joe enjoying his minimal-to-no overhead revenue stream decides to want a bigger share of the profit because he has more leverage as Pizza Hut customers start to like his pizzas. When Pizza Hut does not agree to pay more, Joe might steal a large number of customers and beef up his shop. So, no, it does not make sense for Pizza Hut to take that chance when the costs are not evenly shared and the Pizza Hut's return is not large enough to justify the massive overhead. (UFC is Pizza Hut and Fedor is Joe's Pizza... and the best fight in the world).

Also, the UFC is not a sport, but it came close to being one. When the Ultimate Fighting Championship started no one said anything about MMA. It was more like a tournament to test the dominance of the Gracie fighting system. They to some degree created the sport as it is known in the US, and now it has morphed into what we really know as mixed martial arts-MMA. Come to think of it, we have a lot to thank the UFC for. The sport of MMA would not be this big if the UFC did not trudge through their harder years. I know we can say any other promotion could have been this big if they had the same resources, but the fact of the matter is no other promotion stepped up and had (or found) the resources to do it. So, I find it hard to resent the promotion that has given all of us the opportunity to write, fight, read and watch MMA on a regular basis in the US.

Now, I am in no way claiming they should be the only one out there, but I do not think any business should make it easy for a competitor. This is not science where sharing stem-cell regeneration tips might help all mankind. This is a fight sport. Let the other promotions give it a run and find the resources to make it happen. They have great talent as well. Strikeforce has Fedor, Dan Henderson, Cris Cyborg, Gegard Mousasi, and stellar newcomer Tyron Woodley. Bellator has Eddie Alverez and a knack for picking fighters that have strong local markets. The question is on the business end, are they going to have enough cash flow to get through the rough years. Both promotions are new in comparison to the UFC, and it takes time to build a brand.

The true MMA fan in me wants to see Fedor fight everyone in the UFC's heavyweight division, but I am not going to get mad because a company will not make a "shakey" business decision so I can enjoy 2:30 second fight. The more pressure put on situations like this give more leverage to the party with less to lose (M-1 Global) and make the main party (UFC) more apprehensive to strike a deal because of the perceived leverage given to the smaller promoter. All the accusatory talk about why can't a deal happen might just make it more of an impossibility to get what we want. I look at it like a fight. Let's allow these two go at it and at some point there will be a decision. Either someone will knockout a great agreement, submit to a so-so agreement, or the fans will judge their independent performances and pick what they like to watch more.

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Follow Alvin on Twitter: @AwwwSnap

Alvin Benjamin Carter III is an MMATorch Specialist columnist focusing on the business and statistic side of the sport of MMA. He trains in SanDa / Shan Shou (Chinese Kickboxing) and has started training in MMA. He also has a business background in music production, management, and clothing. He has launched two companies which cater to niche markets, giving him experience in examining trends and attitudes that can affect a particular business model, which he applies in his weekly column for MMATorch to the sport of MMA.