UFC+Ads

= UFC Advertising =

== == ==

==

Introduction
The Ultimate Fighting Championship is quickly becoming a house-hold name in entertainment, replacing the likes of professional wrestling and boxing. “The UFC started in 1993. It was originally intended as a one-off pay-per-view event in which masters of different martial arts faced off against each other in ‘the octagon.’ But when the contest managed to generate close to 90,000 pay-per-view buys, the founders decided to keep going” (Silverman, 2009). The concept is simple: two men stand toe-to-toe, bare knuckled, and fight until one man can no longer stand. Some consider it barbaric, chaotic, while the majority is welcoming it in. According to pay-per-view outlet Viewers Choice, UFC events consistently attract three, four or five times as many buys as boxing and professional wrestling (Brunt, 2009).

The sport has gained steam heading into the decade with its output of video games, internet videos, and immensely popular television show The Ultimate Fighter. "’At that time, we were $30 million in the hole,’ White says (all currency in U.S. dollars). They scraped together $10 million to fund The Ultimate Fighter. It aired early in 2005, and was an instant ratings hit. ‘The show was a Trojan horse,’ White says. ‘No one wanted to put mixed martial arts fights on TV. Now they were watching MMA without even realizing it’” (Silverman, 2009).







Reach / Frequency / Scheduling
The Ultimate Fighting Championship is quickly turning into a cash machine. Advertisers and sponsors are quickly becoming aware of the sport’s ridiculous popularity and are trying to claim their in stake in the growth. While there is a dedicated base for the sport, it certainly is not a small one.

On Jan. 31, 2009, Montreal's Georges St-Pierre defended his title as UFC welterweight champion against Hawaii's BJ Penn. It was the 94th UFC pay-per-view event to date, taking place before a sellout crowd of 14,885 fans at the MGM Grand in Las Vegas. And while the UFC doesn't disclose official figures, the St-Pierre/Penn bout generated an estimated 1.3 million PPV buys (Silverman, 2009). The Ultimate Fighter is the crown jewel as well. Since its inception, an average of 1.9 million viewers have watched the show each week (Schneiderman, 2009).

The beauty of the UFC, for advertisers, is the fact the sport produces around twelve PPV events every single year. With each one bringing in hundreds of thousands of purchases, and new fans always being converted, the opportunities are seemingly endless.

The frequency of the advertisements is the real genius. “A large Bud Light logo emblazoned the canvas and one of the octagon's corners. A Harley-Davidson logo hung above. Advertisements for energy drinks, supplements and clothing manufacturers adorned the fighters' shorts and signage throughout the arena. For advertisers, UFC has been a gold mine of access to a desirable demographic of young men drawn to the wide-open action and short, three-round fights that take less time than most other sporting events” (Lemke, 2009).

The fact that the advertisements never disappear after sixty seconds like a commercial, or are easily forgotten like a jingle, is why advertisers flock to the sport. If you are watching a fight, you are looking at an advertisement. Many giants in the field are hitching their wagons to UFC’s stars. “Over the last year and a half, corporate America has taken notice. The U.F.C., for example, has signed advertising deals with sponsors like Harley-Davidson, Bud Light, Burger King and, most recently, Bacardi” (Schneiderman, 2009).



Audience
The target audience of the Ultimate Fighting Championship is the most appealing quality to advertisers. The major market for the hosted events are young men aged 18-35. The growth of mixed martial arts is an opportunity to extend the brand to younger consumers, said Adam Geisler, the president of Everlast, the athletic wear company” (Schneiderman, 2009).

“The UFC, like it or not, they have a sports product that may be better suited than most to exploit what's coming next. ‘I truly believe that there's a revolution going on now in sports,’ White said. ‘More kids are skateboarding right now than playing little-league baseball. So what does that mean for baseball? The [NBA's] Indiana Pacers just came out and said they lost $30-million last year. A lot of other teams are losing tons and tons of money. How do you stay in business? How do you stay afloat? How do you run a business that's losing $30-million a year? I think times are changing’” (Brunt, 2009).



“Spike officials said UFC is right in the wheelhouse of young fans with little patience for sporting events that last several hours.’It's the MTV generation that needs immediacy and doesn't want to watch 15 rounds of boxing to get a decision,’ said Brian Diamond, Spike's senior vice president of sports and specials” (Lemke, 2009).

Reasons to Utilize the Sport
The loyalty of the fan base is what keeps advertisers coming back. “UFC this year is expected to earn more than $300 million just from the hundreds of thousands of fans tuning into events on pay per view nearly every month. Forbes magazine last year valued UFC at more than $1 billion - more than 500 times what it sold for a decade ago” (Lemke, 2009).

The sport also stands on its own just as well, if not better than others during hard times. Fans are dedicated and fans are willing to pay. The UFC continues to grow while others are struggling, satisfying advertisers and relieving some of their worries.

“In February, 2008, the UFC announced Bud Light would become its official beer sponsor. ‘In the beginning, nobody would touch us,’ White says. But mainstream success was paving the way for ad revenue. ‘For us, it's extra money," he says. ‘We are a pay-per-view company.’ That reliance on PPV, rather than sponsorships, does help the business during tough economic times. ‘I'm not going to say we're recession-proof," he says. ‘But with PPV, you and a few buddies can chip in to buy the fight. It's still a cheap form of entertainment’” (Silverman, 2009).

Limitations
There are few limitations to advertising within the UFC. As the sport grows, and the traditional medias begin to fade while the internet booms, so does the UFC and its focus. “The success of the UFC has also been paralleled by the growth of its online properties. Since we initiated measurement in 2005, UFC.com has gone from 530,000 monthly visitors to nearly 6,000,000 in 2009*. UFC.com has experienced growth unlike any other major sports property; from 2005 - 2009, visitors to UFC.com have grown by more than 1300%. Subsequently, online promotion and advertising has become one of the most powerful marketing tools to reach our audience” (UFC.com).

"’We've been building this whole business with the philosophy that everything is going Internet,’ White said. ‘We believe that you'll be watching television on the Internet. Networks and all these things - we think it's all going away. We're gearing up for the day when you can watch everything all the time. It will be like YouTube’” (Brunt, 2009).

One limitation facing the sport however is the fact that is still not widely accepted. While the fan base is obviously there, and the sport has tremendous success in Las Vegas, it is unable to establish itself across the entire country like organizations like the NFL, NBA, and MLB are able to. “But not all state athletic commissions are sold on the sport and its safety. Mixed martial arts fighting has yet to be approved in the key states of Massachusetts and New York, where legislators have spoken out against its violent nature” (Lemke, 2009).

While the main events of the sport reach nearly two million purchases per event, the UFC is still trumped by the heavy hitters of professional sports. The 2010 NFL Super Bowl, in which the New Orleans Saints defeated the Indianapolis Colts, surpassed 106 million viewers and that made it the most popular and biggest telecast in history (Bauder, 2010). There is a reason, still, why advertisers are willing to spend millions and millions of dollars on thirty seconds worth of air time in the NFL and not the UFC.



Costs / Advertisers
Cost is obviously an important factor in determining sponsorships and advertising for companies and the UFC. As the sport grows, as does its freedom to accept and reject advertising as it so pleases. While blue chip, monster sponsors like Harley Davidson and Bud Light steamroll forward with the company, many smaller ones are being phased out.

“The UFC is now charging prospective sponsors a $100,000 fee for the right to sponsor fighters that appear on UFC broadcasts for a six month period. This eliminates all the small-time sponsors because they may be able to pay $1,000 to a fighter but they aren’t paying $100,000 to UFC for the right to pay $1,000 to a fighter” (Joyner, 2009).

While details are not released on sponsorship pricing, many of the big companies do purchase multiple year deals thus ensuring constant exposure for a long period of time, and year round.

Harley Davidson and Bud Light are the not only successful sponsors however. Other major players include Burger King, Electronic Arts, Gatorade, and Under Armor. While the former have their name and brand plastered throughout the arena, many of the latter are directly on the fighters’ bodies by way of trunks or shirts. Conjoining a brand name with a favorite fighter is just one way to increase the awareness of your product and affiliations.

Impact
UFC advertising is a benefit to both the sponsors and the UFC and that is why so many companies are hoping to attach themselves. The sport is in a boom that introduces whole new audiences for companies to reach on one hand, and acquiring massive global companies gives the UFC a certain legitimacy it didn’t have before on the other.

“By the late 1990s, UFC began cooperating with athletic commissions in many states and instituted more rules to protect fighters. By 2001, the organization drew the attention of Las Vegas casino owners Lorenzo and Frank Fertitta, who purchased it for about $2 million. The brothers brought in childhood friend Dana White, who had been working as an aerobics instructor, to serve as president of the operation. In the eight years since, attendance at events in Las Vegas gradually increased and the UFC branched out into new markets as state athletic commissions granted licenses for mixed martial arts” (Lemke, 2009).

As the organization continues to be accepted by the mainstream, so do the partnerships that conglomerates strike up with it. Even many arguments of the sport being too violent and too dangerous are being put to rest, allowing for opinions to be altered and acceptance be more prominent.

“In an article published in the Journal of Sports Science in 2006, researchers from the Johns Hopkins University School of Medicine said injuries in mixed martial arts fights occurred at about the same rate as in boxing. But the researchers also said the risk for traumatic brain injury was smaller in mixed martial arts because punches to the head are a relatively small component of fights” (Lemke, 2009).

The future remains bright for the growing sport, as younger audiences purchase the video games, wear the t-shirts, and memorize all of their favorite fighters, so does the future for major sponsorships. With fighters becoming as recognizable as baseball players, and coverage round-the-clock on ESPN, the UFC will continue to smash through and garner the much-deserved attention of major players in the advertising game.

media type="youtube" key="WIlS67ZxRtw" height="344" width="425" Various advertisements on display throughout preview on trunks, tee shirts, hats, & the man. WARNING: Violence and advertising chaos ensues.