The UFC`s Global Ambitions; Can They Take over the Sporting World?

Tim AndrewsContributor IJuly 9, 2012

NEW YORK - MARCH 06:   UFC president Dana White signs autographs for fans after a press conference at Radio City Music Hall on March 06, 2012 in New York City.  UFC announced that their third event on the FOX network will take place on Saturday, May 5 from the IZOD Center in East Rutherford, N.J.. (Photo by Michael Nagle/Getty Images)
Michael Nagle/Getty Images

Over the last number of years, perhaps no sport has drawn as much controversy as the Ultimate Fighting Championship. From Senator John McCain referring to early incarnations of the sport as "human cockfighting" to the current and more modern, yet brash tone of President Dana White, who continually spits verbal venom at his adversaries, the UFC has garnered its fair share of attention.

Attention has brought viewership. Viewership has brought with it pay-per-view buys, large corporate sponsors (including Budweiser and Harley Davidson) and, more recently, a deal with the FOX network. Though the UFC is a private company—and, as such, its financial performance is unknown—it's fair to say each has had a positive impact on the company's bottom line.

Despite the seemingly exponential growth in recent years, PPV buys and television ratings are beginning to flatten and even decline. In fact, an argument could be made that, at least in terms of the Western world, the UFC has reached the maturity portion of its product life cycle.

To be fair, a counter argument could be that injuries to key starts like Georges St-Pierre and Anderson Silva—along with the retirements of the seemingly ageless Randy Couture and the ultimate alpha male Brock Lesnar—are the root source of flattening viewership.

Whatever the case, in an effort to continue to grow, a concerted effort has been made to expand its audience and consumer base.

First, there was international expansion. There were events held in emerging economies like Brazil, along with promotional tours in the Philippines to promote the sport. There also was the selling off of 10 percent of the company to a Middle Eastern entertainment company to increase exposure and distribution.

Additionally, there have been outward expressions of interest in holding events in India, China and even Russia.

Next was product and brand expansion, specifically opening a line of signature gyms. Presumably, at least part of the concept was to train members to get fit using martial arts as a base. If members train in martial arts, maybe they become fans, and then maybe they buy the next pay-per-view.      

All of this was done for good reason. If more people buy the product and spend money on pay-per-views, merchandise and gym memberships, the UFC stands to profit and, maybe one day, reach the ambitious goal of ousting soccer as the world’s most popular sport.

Unfortunately, reaching new audiences is no simple task; international expansion is not as easy as setting up a few offices and selling a product—just ask Starbucks.

Breaking into Japan has numerous challenges. The vast majority of India lives below the poverty line and will probably never be able to afford a television, let alone regular pay-per-views at $49.99.

China is a possibility; in fact, one could argue the future of the entire U.S. economy could be heavily centered on selling quality American products and services to the young, affluent Chinese consumer (think Apple). Can the UFC be a leader in penetrating this market?

In addition to its global ambitions, the UFC parted ways with its long-time broadcasting partner, Spike TV, and moved over to the FOX network. Following large numbers tuning in to watch Junior dos Santos knock out Cain Velasquez for the heavyweight title in little more than a minute, viewership has declined in subsequent FOX events. 

Star power has to be another concern. The Ultimate Fighter reality show is unlikely to ever consistently bring in talent (or attention) like other sports do; Michael Chiesa is not Andrew Luck.

Maybe the UFC has a future more like cricket than soccer; maybe it becomes extremely popular in niche pockets of the world, but never quite catches on globally.

Maybe the North American market is at its full potential, and maybe Brazil becomes the center of the MMA universe.

Or, maybe MMA does manage to penetrate new global markets, and maybe North American growth hasn't hit a plateau.

After the last 10 years, I wouldn't count anything out.